Hillsboro Properties v. Public Utilities Commission

I. Introduction

These related petitions challenge the Public Utilities Commission’s (PUC) exercise of jurisdiction pursuant to, and its interpretation of, Public Utilities Code section 739.5. That section controls the utility rates mobile-home park owners and other landlords may charge their tenants where the utility company does not service the tenants directly, but rather provides natural gas and electricity service to the landlord, who in turn distributes service to the tenants. Tenant Robert Hambly (Hambly), for himself and on behalf of the residents of Los Robles Mobilehome Park (Los Robles), filed a complaint against the City of Novato (City) and Hillsboro Properties (Hillsboro), the owner of Los Robles. The PUC determined that Hillsboro had assessed annual rent increases that, although authorized by the City under its municipal rent control ordinance, increased the rates for electricity and natural gas service in violation of section 739.5. Petitioners make numerous arguments that can be reduced to two key issues: (1) whether the PUC has improperly usurped the City’s rent control jurisdiction; and (2) whether the PUC erred in interpreting section 739.5 to prohibit…