This report is submitted pursuant to Chapter 323, Statutes of 1983. This legislation requires the Legislative Analyst to (1) evaluate the effectiveness of regulatory fees as a method of funding the California Public Utilities Commission (PUC) and (2) recommend whether regulatory fee funding for the PUC should be continued, amended, or repealed. Chapter 1 describes the PUC's regulatory fee system. Chapter 2 provides the major arguments for and against the use of regulatory fees and contains our recommendation on the commission's ongoing funding source. Chapter 3 describes other issues related to the PUC's regulatory fee structure.