BILL ANALYSIS                                                                                                                                                                                                    Ó



          SENATE COMMITTEE ON ENERGY, UTILITIES AND COMMUNICATIONS
                              Senator Ben Hueso, Chair
                                2015 - 2016  Regular 

          Bill No:          SB 1055           Hearing Date:   4/19/2016  
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          |Author:    |Hueso                                                |
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          |Version:   |2/16/2016    As Introduced                           |
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          |Urgency:   |No                     |Fiscal:      |Yes             |
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          |Consultant:|Nidia Bautista                                       |
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          SUBJECT: Payphone Service Providers Committee

            DIGEST:  This bill would eliminate the Payphone Service  
          Providers Committee (PSPC), the corresponding fund, which was  
          intended to advise the California Public Utilities Commission  
          (CPUC) regarding payphones. 

          ANALYSIS:
          
          Existing law:
          
          1)Requires the CPUC to adopt and enforce operating requirements  
            for telephones available for public use that accept any form  
            of payment and that are owned and operated by corporations or  
            person other than telephone corporations.  (Public Utilities  
            Code §742)

          2)Establishes the PSPC as an advisory board to advise the CPUC  
            regarding development, implementation, and administration of  
            programs to educate pay phone service providers, ensure  
            compliance with the CPUC's requirements for pay phone  
            operations, and educate consumers on matters related to pay  
            phones. (Public Utilities Code §279)

          3)Establishes several telecommunications-related funds in the  
            State Treasury, including the PSPC Fund.  (Public Utilities  
            Code §270 (a) (5))

          4)Provides that Federal Communications Commission (FCC) shall  
            take all actions necessary to prescribe regulations that  
            establish a per call compensation plan to ensure that all  







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            payphone service providers are fairly compensated for each and  
            every completed intrastate and interstate call using their  
            payphone, except emergency calls and relay service call for  
            hearing disabled individuals, and other requirements.   
            Establishes that to the extent that any state requirements are  
            inconsistent with the FCC's regulations, federal regulations  
            on such matters shall preempt such state requirements.  (47  
            United States Code §276) 

          This bill:

          1)Eliminates the PSPC which was intended to advise the CPUC  
            regarding the development, implementation, and administration  
            of programs to educate payphone service providers, ensure  
            compliance with the CPUC's requirements for payphone  
            operations, and educate consumers on matters related to  
            payphones.

          2)Eliminates the corresponding PSPC Fund.

          Background
          
          When the PSPC was established, in 1999, there were nearly  
          100,000 payphones in use across California.  However, the number  
          of payphones has since dramatically declined with the widespread  
          growth of wireless phones.  Within less than 10 years of  
          establishing the PSPC, the CPUC, in D. 06-08-020, called for its  
          elimination stating it was "no longer functional."  After the  
          PSPC ceased operations and asked the CPUC for its dissolution,  
          the associated fund also became unused and no longer necessary. 

          Today, there are roughly 27,000 payphones in operation in  
          California.  These phones are owned and maintained by individual  
          owners who purchase dial tone service from telephone service  
          providers.  Currently, there are an estimated 1,150 payphone  
          owners.  The owners of the payphones maintain all the hardware  
          for the phone, select the locations, install and remove  
          payphones, and are responsible for maintaining the required  
          signage and disclosures on the payphones. 

          While the CPUC ordered the elimination of the PSPC, it also  
          concluded that "payphones have an important role in meeting our  
          universal service goals, and Californians continue to use public  
          payphones, especially in emergency situations."  Therefore, the  
          CPUC requires pay phone service providers to report on a monthly  








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          basis pay phone locations and owner information.  CPUC uses this  
          information to manage the payphone enforcement program, staffed  
          by three CPUC inspectors.  These inspectors verify that calls  
          can be placed to 9-1-1 and to operator service providers and  
          that collect calls can be made.  CPUC inspectors prioritize  
          inspections of payphones often vandalized, located in critical  
          areas such as airports, schools and hospitals, remote areas, and  
          areas recently affected by natural disasters.  In 2015, CPUC  
          inspectors conducted nearly 5,000 payphone inspections.   
          Elimination of the PSPC and the PSPC Fund will not affect the  
          CPUC's continued enforcement activities.


          Prior/Related Legislation
          
          SB 669 (Polanco, Chapter 667, Statutes of 1999) established,  
          among other provisions, several advisory boards and  
          corresponding funds related to telecommunications, including the  
          PSPC and the PSPC Fund.

          FISCAL EFFECT:                 Appropriation:  No    Fiscal  
          Com.:             Yes          Local:          No


            SUPPORT:  

          California Public Utilities Commission (Source)

          OPPOSITION:

          None received

          ARGUMENTS IN SUPPORT:  This bill will eliminate an advisory  
          committee and fund that are no longer necessary (or in use).   
          While other advisory committees established by SB 669 (Polanco,  
          1999) are still in use, such as the High-Cost Fund - A & B, Deaf  
          and Disabled Telecommunications Program Administrative Committee  
          Fund, and others, the PSPC was found early on to not have much  
          utility or necessity.  However, the fund has continued to exist  
          in the Public Utilities Code. 
          

          

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