BILL NUMBER: AB 1528 AMENDED
BILL TEXT
AMENDED IN ASSEMBLY APRIL 20, 2009
INTRODUCED BY Assembly Member Ruskin
FEBRUARY 27, 2009
An act to add Section 709.1 873.5 to
the Public Utilities Code, relating to telecommunications.
LEGISLATIVE COUNSEL'S DIGEST
AB 1528, as amended, Ruskin. Telecommunications.
Telecommunications: lifeline service rates.
Under existing law, the Public Utilities Commission has regulatory
authority over public utilities, including telephone corporations,
as defined. Existing law authorizes the commission to fix the rates
and charges for every public utility, and requires that those rates
and charges be just and reasonable. The Moore Universal Telephone
Service Act established the Universal Lifeline Telephone Service
program in order to provide low-income households with access to
affordable basic residential telephone service. Lifeline service
rates are required to be set at no more than 50% of either the basic
rate for measured service or the basic flat rate service, as
applicable, exclusive of federally mandated end user access charges
that are available to the residential subscriber.
This bill would prohibit the commission from authorizing a
telephone corporation to increase rates or charges for local exchange
services provided to lifeline telephone service subscribers above
those in effect on January 1, 2009, except that rates and charges for
local exchange services provided to lifeline telephone service
subscribers may be increased in an amount no greater than the maximum
annual cost-of-living percentage increase established for the
CalWORKs program. The bill would prohibit the commission from
authorizing telecommunications carriers using alternative
technologies to traditional landline service, including mobile
telephony service providers and carriers offering telecommunication
using Voice over Internet Protocol, to provide lifeline service only
if the commission finds that there will be no reduction in service
quality or service capabilities for lifeline service subscribers than
those in effect on January 1, 2009, resulting from use of the
alternative technologies.
Under existing law, the Public Utilities Commission has regulatory
authority over public utilities, including telephone corporations,
as defined. Existing law authorizes the commission to fix the rates
and charges for every public utility, and requires that those rates
and charges be just and reasonable. Existing law sets forth the
telecommunications policies of the state. An existing decision of the
commission established a uniform regulatory framework for the large-
and mid-sized incumbent local exchange carriers that granted those
telephone corporation broad pricing freedoms concerning almost all
telecommunications services, new telecommunications products, bundles
of services, promotions, and contracts.
This bill would require the commission to collect
California-specific data necessary to monitor changes in the
telecommunications market to determine whether adoption of the
uniform regulatory framework is achieving results consistent with the
state's telecommunications policies. The bill would require the
commission to require that all telephone corporations report certain
information on a quarterly basis and report on the content and
resolution of customer complaints.
Under existing law, a violation of the Public Utilities Act or any
order, decision, rule, direction, demand, or requirement of the
commission is a crime.
Because the provisions of this bill are within the act and require
action by the commission to implement its requirements, a violation
of these provisions would impose a state-mandated local program by
creating a new crime.
The California Constitution requires the state to reimburse local
agencies and school districts for certain costs mandated by the
state. Statutory provisions establish procedures for making that
reimbursement.
This bill would provide that no reimbursement is required by this
act for a specified reason.
Vote: majority. Appropriation: no. Fiscal committee: yes
no . State-mandated local program: yes
no .
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. The Legislature finds and declares all
of the following:
(a) Ensuring that all California residents have access to
affordable, reliable, and high-quality basic local telephone service
has been a longstanding policy of the state.
(b) To help achieve this policy, the Legislature enacted the Moore
Universal Telephone Service Act that created a lifeline class of
telephone service for low-income citizens.
(c) The vast majority of California residents still use
traditional landline basic telephone service as their primary home
telecommunications service.
(d) Despite the introduction of competition in the
telecommunications marketplace, low-income residential customers and
customers living outside dense urban areas have few choices for
providers of basic telephone service.
(e) Where a residential consumer does have a choice among
providers, it is usually between the incumbent local exchange carrier
and the cable television company. Cable television companies
generally do not offer stand-alone basic landline telephone service,
but instead offer services through bundles costing significantly more
money than basic telephone service as a stand-alone product.
(f) Many other technologies used to provide voice
telecommunications services are generally not effective substitutes
for traditional landline basic telephone service for a number of
reasons, including significant differences in quality and
deficiencies in coverage areas, higher prices, and diminished access
to the 911 emergency telephone network.
(g) Over one-half of the estimated six million California
residents whose income qualifies them for lifeline telephone service
do not receive the discount and depend upon basic telephone service
as a safety net.
(h) In Decision 06-08-030 the Public Utilities Commission
established a uniform regulatory framework for the large- and
mid-sized incumbent local exchange carriers that granted those
telephone corporation boards pricing freedoms concerning almost all
telecommunications services, new telecommunications products, bundles
of services, promotions, and contracts, effectively deregulating
telephone service for those telephone corporations.
(i) As part of its decision to adopt a uniform regulatory
framework, the commission authorized rate increases for both lifeline
telephone service and basic telephone service rates for the four
largest telephone corporations in California and will eliminate all
price regulation for those four carriers at the beginning of 2011.
(j) The commission should not authorize telephone corporations
utilizing alternative technologies to traditional landline service,
including mobile telephony service and Voice over Internet Protocol,
to offer lifeline telephone service unless doing so would result in
no degradation in service quality or in the capabilities of lifeline
telephone services in effect at the time the commission adopted its
uniform regulatory framework.
SEC. 2. Section 873.5 is added to the
Public Utilities Code , to read:
873.5. (a) The commission shall not authorize a telephone
corporation to increase rates or charges for local exchange services
provided to lifeline telephone service subscribers above those in
effect on January 1, 2009, except that rates and charges for local
exchange services provided to lifeline telephone service subscribers
may be increased each year in an amount that is no greater than the
maximum annual cost-of-living percentage increase established for the
CalWORKs program pursuant to Chapter 2 (commencing with Section
11200) of Part 3 of Division 9 of the Welfare and Institutions Code,
or a successor program.
(b) The commission may authorize telecommunications carriers using
alternative technologies to traditional landline service, including
mobile telephony service providers and carriers offering
telecommunication using Voice over Internet Protocol, to provide
lifeline service only if the commission finds that there will be no
reduction in service quality or service capabilities for lifeline
service subscribers than those in effect on January 1, 2009,
resulting from use of the alternative technologies.
SECTION 1. The Legislature finds and declares
all of the following:
(a) In Decision 06-08-030, the Public Utilities Commission granted
large- and mid-sized incumbent local exchange carriers broad pricing
freedoms concerning almost all telecommunications services, new
telecommunications products, bundles of services, promotions, and
contracts, effectively deregulating telephone service.
(b) Decision 06-08-030 further permitted geographic deaveraging of
rates and eliminated California-specific monitoring reports while
relying on forecasts of market evolution and predictions about price
changes to ensure consumers receive just and reasonable rates and
appropriate levels of service.
(c) In order to verify that competitive forces are having the
desired effect, data specific to California relative to prices,
competition, affordability, and the deployement and equitable
provision of new technologies and services is necessary for the
Legislature to determine whether changes in the telephone service
regulatory framework are producing results consistent with California
telecommunications policies, including those set forth in Section
709 of the Public Utilities Code.
(d) Reliance exclusively upon reports produced by the Federal
Communications Commission and submitted to Congress is insufficient
to determine the extent to which California's telecommunications
policies are being achieved.
SEC. 2. Section 709.1 is added to the Public
Utilities Code, to read:
709.1. (a) For purposes of this section, "uniform regulatory
framework" means the system of rate regulation adopted by the
commission for large- and mid-sized incumbent local exchange carriers
pursuant to Decision 06-08-030, as modified in Decision 06-12-044.
(b) The commission shall collect California-specific data
necessary to monitor changes in the telecommunications market to
determine whether adoption of the uniform regulatory framework is
achieving results consistent with the state's policies for
telecommunications set forth in Section 709.
(c) Pursuant to subdivision (b), the commission shall require all
telephone corporations to quarterly report, in standardized format,
geographically specific data setting forth current prices charged for
the following services:
(1) Basic residential and business line service.
(2) Universal Lifeline Telephone Service.
(3) Nonrecurring charges.
(4) Privacy-related services.
(5) Services relied on by persons with disabilities.
(6) The lowest priced residential and business service packages or
bundles of services that contain the functional equivalent of basic
service and including all services traditionally associated with
basic service.
(7) Toll limitations.
(8) The prices for mobile telephony service bundles, stand-alone,
and broadband services bundled with telephone service.
(d) Pursuant to subdivision (b), the commission shall require all
telephone corporations to quarterly report on service availability by
census tract, and line counts, including voice grade wireline,
broadband, and wireless service, by customer class if applicable.
(e) Pursuant to subdivision (b), the commission shall require all
telephone corporations to report on the content and resolution of
customer complaints.
SEC. 3. No reimbursement is required by this
act pursuant to Section 6 of Article XIII B of the California
Constitution because the only costs that may be incurred by a local
agency or school district will be incurred because this act creates a
new crime or infraction, eliminates a crime or infraction, or
changes the penalty for a crime or infraction, within the meaning of
Section 17556 of the Government Code, or changes the definition of a
crime within the meaning of Section 6 of Article XIII B of the
California Constitution.