California in tussle over record utility fine

LOS ANGELES (AP) — The biggest beneficiary of the record $1.4 billion fine levied against Pacific Gas & Electric Co. for a gas line explosion that killed eight people and destroyed dozens of homes in suburban San Francisco is the state of California, which stands to gain $950 million to spend any way it wants.

That reality has set up a tussle over how the state punishes corporate wrongdoing and who should benefit from fines like the one Public Utilities Commission judges imposed on PG&E earlier this week for the 2010 blast. The judges wrote that “a fine of this magnitude is necessary to deter future violations” and said they were following established policy by earmarking the large fine for the state treasury.