PG&E still calls the shots

Newsom takes aim at the Public Utilities Commission

EDITORIAL Mayor Gavin Newsom hasn't even officially started his second term, and already he's putting out the signals: this is going to be a very bad four years. He's sent loyal staffers packing, cut salaries in his office by sending a senior aide to the airport with no real job description, and created a bogus hiring freeze that lets him control all new city employment in every department.

And now, several supervisors say, he's allowing Pacific Gas and Electric Co. to decide who gets to run the city's Public Utilities Commission.

Newsom's office won't comment on why the mayor has asked PUC general manager Susan Leal to resign. The mayor hasn't explained what Leal might have done that would be so bad that it's worth spending $500,000 the city doesn't have to buy out her contract. But Sups. Ross Mirkarimi and Aaron Peskin, who have been watching Leal closely, say the reason she's being sent packing is very simple: she's moving too aggressively on public power.

Now, let's step back a moment here and put this in perspective. Leal was never a radical public power advocate. She didn't support public power when she was on the Board of Supervisors and was very slow to come around to the notion that the city should take a more active role in generating and distributing its electricity.

But over the past few years Leal and her staff have been cautiously, haltingly moving toward community choice aggregation, city-owned generation, and the concept of putting city power lines below the streets. It's not an agenda that was going to lead to a total takeover of PG&E's facilities in the next year or two, and, in fact, at Leal's pace PG&E's illegal monopoly was probably safe for another decade. Still, Leal was moving toward creating city-owned electric generation through a set of new combustion turbines — a plan PG&E bitterly opposed.

Leal isn't commenting, and the Mayor's Office will only say that discussions about her job tenure are ongoing. But City Hall sources tell us Newsom's office informed Leal last week that she would be among the department heads replaced next year — and there's plenty of evidence that her willingness to proceed with public power is among the reasons why. "That's absolutely part of what this is about," one person close to the Mayor's Office told us. Another said, "The Mayor's Office is saying she has a bad relationship with the commission, and a lot of that is about city-owned power."

Ryan Brooks, the president of the PUC, told us he couldn't comment on a personnel matter and insisted that Leal isn't facing the ax because of public power. But he made a point of saying the commission needs "to take a step back and see what we're trying to do" before proceeding with anything that looks like a public power plan.

The message here is pretty clear: challenge PG&E in Newsom's San Francisco, and your job is on the line.

Leal's no fool. She refused to take the PUC job unless the mayor offered her a written contract that makes it expensive to get rid of her. And Leal can simply collect her lucrative severance package and walk away.

But if she's serious about her legacy, her political future, and the issues she says she cares about, Leal shouldn't back down so quickly. The mayor can't fire her directly; that's the job of the five-member PUC. And while Newsom asked every department head to submit a resignation letter months ago, Leal was cagey; her letter stops short of offering to leave. So legally, the mayor can't simply accept her resignation if she chooses to fight. In fact, Angela Alioto, a civil rights lawyer and former supervisor, says Leal is in the driver's seat here. "She has a contract, and she can't be fired without cause," Alioto told us.