BILL ANALYSIS                                                                                                                                                                                                    Ó



                                                                  SB 740
                                                                  Page  1

          Date of Hearing:   August 21, 2013

                        ASSEMBLY COMMITTEE ON APPROPRIATIONS
                                  Mike Gatto, Chair

                   SB 740 (Padilla) - As Amended:  August 7, 2013 

          Policy Committee:                             Utilities and  
          Commerce     Vote:                            11-4

          Urgency:     Yes                  State Mandated Local Program:  
          No     Reimbursable:              

           SUMMARY  

          This bill expands eligibility in the California Advanced  
          Services Fund (CASF), establishes a program goal, and increases  
          the program funding.   Specifically, this bill:   

          1)Specifies the goal of the CASF program is to approve funding  
            for infrastructure projects that contribute to expanding  
            broadband access to no less than 98% of California households  
            no later than December 31, 2015.

          2)Increases the amount the PUC is authorized to collect to an  
            amount not to exceed $215 million, and requires that $190  
            million be deposited into the Broadband Infrastructure Grant  
            Account.

          3)Requires the Public Utilities Commission (PUC) to give  
            priority to projects that provide last-mile broadband access  
            to households that are unserved by an existing  
            facilities-based broadband provider.

          4)Allows an entity that is not a telephone corporation to apply  
            to participate in the CASF program to provide access to  
            broadband to an unserved or underserved household, as defined,  
            if the entity meets the eligibility requirements and complies  
            with program requirements established by the PUC.

           FISCAL EFFECT  

          Unknown cost pressures, potentially in the hundreds of thousands  
          of dollars from the CASF (special fund) for expanded grantee  
          eligibility








                                                                  SB 740
                                                                  Page  2


           COMMENTS  

           1)Purpose.   According to the author, this bill modifies the CASF  
            to support broadband infrastructure in the most remote areas  
            of the state that still lack the high-speed Internet access.   
            It is intended to advance state policy to ensure that all  
            Californians are served.

           1)Background.   In 2008, SB 1193 (Padilla) authorized the PUC to  
            assess a surcharge on telephone ratepayers to fund the CASF.   
            Existing law now requires $100 million collected by the  
            surcharge to be deposited into the Broadband Infrastructure  
            Account.  The PUC is authorized to collect an additional sum  
            not to exceed $125 million after January 1, 2011 through the  
            2015 calendar year.  

            The CASF provides funding to encourage deployment of  
            high-quality advanced communications services to all  
            Californians.  The program is designed to promote economic  
            growth, job creation, and substantial social benefits of  
            advanced information and communications technologies.

           Analysis Prepared by  :    Jennifer Galehouse / APPR. / (916)  
          319-2081