As the 2005 legislative session advances toward a grand finale, Governor Arnold Schwarzeneggers plan to reorganize state energy agencies was put out of its misery. The full Senate rejected the plan August 25. The administration hopes it will rise again as new legislation this session. “It was presented to the Legislature as a ‘take it or leave it’ proposition,” stated Senator Martha Escutia (D-Montebello). “We can’t fix it, so we had no choice but to reject it and start over.” At a hearing on the reorganization plan the previous day, Joe Desmond, California Energy Commission chair, said, “The governor feels a sense of urgency,” He told the Senate Energy, Utilities and Communications Committee that the bill would go through the regular legislative process” unlike the original plan. It will provide “a vehicle to sit down and have discussion.” Getting a bill out the door in the remaining two weeks of the session would be a stretch. “More likely, we’ll try to work during the interim to ready a bill for next year,” said Lawrence Lingbloom, energy committee consultant. In the past few days, the administration has drafted legislative language it expects to introduce. The new bill addresses concerns about the initial plan raised by the Little Hoover Commission, Attorney General Bill Lockyer, and others, according to the administration. Although Lockyer’s office said that the changes meet the AG’s concerns because the administration intends to submit the plan to lawmakers as a bill, the legislative language reviewed by the AG’s office was different from what Desmond described to the committee. That apparently reflected last-minute changes. The discrepancy appeared in an August 23 letter from Mark J. Breckler, senior assistant attorney general, on behalf of Lockyer to Peter Siggins, legal affairs secretary to Schwarzenegger. Republicans suggested that the administration could use a “gut and amend” process to try to pass the new measure in the final days of the legislative session. In that process, the language in a bill that has passed one chamber and is about to be considered in the other is removed and new, unrelated language inserted. Democrats on the committee conceded that reorganization is needed but said it is not an urgent matter. Desmond highlighted the key features of the new reorganization legislation-without sharing its actual text. The committee then voted 6-3 to recommend that the full Senate reject the initial reorganization plan, known as GRP 3. “We as the Legislature shouldn’t just throw [reorganization] out,” said Senator Jim Battin (R-Palm Desert). Committee chair Escutia said she did not disagree but thought it was imprudent to act without seeing the new bill’s language. “We’re working here in the dark,” she warned. The governor’s attempt at reorganizing energy agencies was made under a seldom-used process from the executive office. With it, the Legislature could not amend GRP 3 but can only vote it up or down. Should lawmakers fail to act, a reorganization would take effect automatically. Under the governor’s plan, a reorganization would create a new state Department of Energy, which would subsume the California Energy Commission, the Electricity Oversight Board, the Department of Water Resources’ energy functions, and the services that the now-defunct California Power Authority was to provide. The Energy Commission would govern the new department, but it would be chaired by a new cabinet-level secretary of energy appointed by the governor, who also would direct the department’s staff (<i>Circuit</i>, May 13, 2005). The Energy Commission, instead of the California Public Utilities Commission, would issue certificates of public convenience and necessity for transmission lines and gas pipelines after determining their costs and benefits. The CPUC would be limited to later allocating cost recovery for those facilities among utility ratepayers. The plan also would limit judicial review of Energy Commission decisions on energy infrastructure facilities to the state Supreme Court. Judicial review of CPUC facility decisions now begins in Superior Court. The CPUC would retain authority to recommend cost caps for new transmission facilities—a clarification from the initial proposal—as well as its ratemaking authority for new transmission lines. The bill also would streamline analyses needed to approve new transmission lines, eliminating what Desmond said were duplicative and time-consuming studies. In another change, Desmond said, the new bill drops the proposal to make the secretary of the department—who would be appointed by the governor—the chair of the Energy Commission, which some legislators contended would politicize decision making. Instead, members of the commission would rotate through two-year terms as chair. Following the August 24 hearing, Senator Bill Morrow (R-Carlsbad), committee vice-chair, told Circuit that the Democrats’ focus on procedure rather than the merits of the proposal was just “an excuse” not to act on reorganization. “I can’t say I was encouraged by what I saw today,” said Morrow, who supports the governor’s reorganization. He noted that Democratic support was lacking and critical to passage of the governor’s reorganization—be it under the original plan or through a gut-and-amend process in the final hours of the legislative session.