BILL ANALYSIS                                                                                                                                                                                                    Ó



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

          Bill No:          SB 1250           Hearing Date:     4/5/2016
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          |Author:    |McGuire                                              |
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          |Version:   |3/28/2016    As Amended                              |
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          |Urgency:   |No                     |Fiscal:      |Yes             |
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          |Consultant:|Nidia Bautista                                       |
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          SUBJECT: Telecommunications: major rural outages: notifications  
          and reporting

          DIGEST:  This bill would require notification of a major rural  
          outage of service, as defined, of specified providers of  
          telecommunication services and require the California Public  
          Utilities Commission (CPUC) in consultation with the Office of  
          Emergency Services (OES) to establish the requirements.
          
          ANALYSIS:
          
          Existing law:
          
          1.Provides that the CPUC has regulatory authority over public  
            utilities, including telephone corporations.  (California  
            Constitution, Article 3 and 4)

          2.Requires the CPUC to periodically assess the reliability of  
            the public telecommunications network and, if necessary, to  
            develop recommendations for improvement. 

          3. Prohibits the CPUC from exercising regulatory jurisdiction  
            over Voice Over Internet Protocol (VOIP) and Internet Protocol  
            (IP) enabled services, except as specified, or as expressly  
            authorized by federal law or by statute. (Public Utilities  
            Code §710)

          4. Establishes the Warren 911 Emergency Assistance Act  
            (Government Code §53100) which establishes the 911system.

          5.Establishes the California Emergency Services Act and provides  







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            that the state is recognized with responsibility to mitigate  
            the effects of natural, manmade, or war-caused emergencies  
            that result in conditions of disaster or in extreme peril to  
            life, property, and the resources of the state, generally to  
            protect the health and safety and preserve the lives and  
            property of the people of the state.  Confers on the Governor  
            to provide state assistance and emergency programs and  
            establishes the OES.  (Government Code §8550)
          This bill:

          1.Establishes the 911 Emergency Reliability and Public Safety  
            Act and requires the CPUC to annually report to the  
            Legislature summarizing major rural outage information,  
            including the number and duration of major rural outages and  
            the number of customers affected by those outages, as well as,  
            any related rules adopted, recommendations for statutory  
            changes, remedial actions to avoid outages, and failures to  
            comply. 

          2.Defines "major rural outage" as an outage of  
            telecommunications service in a rural area, experienced by a  
            facilities-based provider of telecommunications services that  
            the Federal Communications Commission (FCC) requires to  
            provide access to 911 service, that is both (A) of 30 or more  
            minutes duration and (B) potentially affects 75,000 or more  
            user-minutes. User-minutes is defined as multiplying the  
            outage's duration in minutes and the number of users  
            potentially affected. 

          3.Requires the CPUC, in consultation with OES, to require all  
            facilities-based providers of telecommunications services to  
            provide responder outage information within 30 minutes of the  
            outage to OES.  Requires OES to notify any applicable county  
            office of emergency services and sheriff of any county  
            affected by the outage, with specified information regarding  
            the telecommunications providers.

          4.Requires the CPUC, in consultation with OES, to adopt rules to  
            inform the public relative to outages, including specified  
            information to be posted on the providers Internet website. 

          5.Requires the CPUC, in consultation with OES, to require all  
            facilities-based providers of telecommunications services to  
            provide initial outage reporting within 120 minutes of the  
            outage to OES.  Requires OES to notify any applicable county  








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            office of emergency services and sheriff of any county  
            affected by the outage and specifies what should be included  
            in the report. Requires the telecommunications service  
            provider to notify the CPUC upon its completion of providing  
            initial outage reporting.  Requires the CPUC, in consultation  
            with OES, to determine what information may be made public  
            consistent with the confidentiality provisions of Public  
            Utilities Code § 583 and confidentiality requirements of the  
            FCC.

          6.Requires the CPUC, in consultation with OES, to require all  
            facilities-based providers of telecommunications services to  
            provide final outage reporting within 20 days of the outage to  
            OES and the CPUC.  Requires specified information that should  
            be included in the report.  Requires the telecommunications  
            service provider to notify the CPUC upon its completion of  
            providing initial outage reporting.  Requires the CPUC, in  
            consultation with OES, to determine what information may be  
            made public consistent with the confidentiality provisions of  
            Public Utilities Code §583 and confidentiality requirements of  
            the FCC.  Requires that a written summary of the outage report  
            is supplied to the board of supervisors of each county  
            affected by the outage within 30 days of the major rural  
            outage.

          7.Authorizes the CPUC, in consultation with the OES, to adopt  
            rules to implement and refine the notification and reporting  
            requirements.

          8.Provides that violations of the 911 Emergency Reliability and  
            Public Safety Act are subject to existing CPUC enforcement  
            actions, including fines and penalties. 

          9.Establishes that rural outage notifications and reporting  
            requirements of this act shall be among the numerous  
            provisions explicitly authorized and not subject to the  
            limitations imposed on the CPUC to limit regulatory  
            jurisdiction of VOIP and IP.

          Background

          North Coast service outages.  The North Coast of California has  
          experienced at least four significant outages of the its  
          telecommunications service in the last year, including a  
          September 3, 2015 incident when a fiber cable owned by AT&T was  








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          cut, as well as, December 9th outage in Humboldt County.  These  
          outages have affected the public safety in several ways  
          including the loss of 911 service. During some of these outages  
          ambulances have been deployed and staged at busy intersections,  
          in lieu of 911 services.  Additionally, the United States Coast  
          Guard was required to fly their entire Northern territory until  
          emergency service would be back up.  Although these outages have  
          affected the communities' quality of life and public safety,  
          many of the outages experienced in the North Coast never reach  
          the federal Network Outage Reporting System (NORS) thresholds,  
          therefore telecommunications service providers are not required  
          to communicate with local and statewide emergency officials.  

          FCC outage reporting requirements.  The FCC requires  
          facilities-based telecommunications service providers, including  
          wireless, wireline/landline, cable and satellite communications  
          providers, including VOIP services, to report information  
          electronically, through the NORS, about significant disruptions  
          or outages to their communications systems that meet specified  
          thresholds set forth in the FCC's rules (47 C.F.R. Part 4).  The  
          FCC presumes the outage information is confidential and  
          protected from routine public disclosure given the sensitivity  
          of the information to national security and commercial  
          competitiveness.  The FCC requires facilities that trigger the  
          required threshold of 900,000 user minutes provide the required  
          notification.  This threshold is defined as an outage lasts at  
          least 30 minutes and affects at least 900,000 user minutes,  
          calculated as the outages duration multiplied by the potential  
          customers affected.  The CPUC largely adheres to the FCC outage  
          notification requirements, utilizing the same thresholds and  
          similar reporting detailed in General Order 133-C.  However, the  
          CPUC has petitioned the FCC in order to gain access to the NORS  
          data for California.

          FCC opens rulemaking to propose changes to NORS reporting.  In  
          March 2015, the FCC adopted a Notice of Proposed Rulemaking  
          regarding proposals to update the Outage Reporting rules to  
          enhance the reliability and resiliency of the Nation's  
          communication system, in particular to strengthen the Nation's  
          911 system.  The FCC is considering a number of changes to the  
          existing rules, however, largely maintaining the existing  
          notification outage threshold of 30 minutes duration and  
          affecting 900,000 user minutes.  The proposals include creating  
          more uniformity in applying the threshold for wireless service  
          which the FCC found are applying different methods, as well as,  








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          proposals to better address the needs of rural communities by  
          considering a geography-based threshold.  The FCC is also  
          soliciting comments as to whether and how it may share data with  
          state regulatory agencies, such as the CPUC.  As of the writing  
          of this analysis, the proposed rulemaking remains open.

          Rural vs. urban/suburban.  This bill utilizes the U.S. Census  
          Bureau definition for rural communities.  Since  
          telecommunications networks are not necessarily designed in a  
          manner that reflects the rural and urban/suburban designations  
          of the U.S. Census map, there may be some instances when the  
          interface between the two may trigger reporting requirements  
          that when the population numbers of the network are skewed by  
          the network servicing the neighboring suburban/urban area.  
          However, this would pose a challenge in a situation when the  
          service often goes out in the area. It would seem reasonable  
          that service outages experienced by customers should be  
          minimized in those instances, as the urban areas may be more  
          likely to have redundancy built into its systems. 

          Regulation of VOIP and IP.  In 2012, the Legislature passed  
          statute to limit the CPUC's regulation of VOIP and IP-enabled  
          services, Public Utilities Code §710.  However, the code section  
          explicitly lists several exemptions for regulatory activities  
          that would be allowed which include the CPUC's authority in  
          Public Utilities Code §716 to require data and requirements to  
          maintain the 911 services.  Additionally, Public Utilities Code  
          710 provides that additional exceptions to the prohibition on  
          CPUC regulatory oversight can be made so long as they are  
          established via statute or by the federal government.  The  
          proposed addition of rural outage notification in SB 1250 would  
          meet the requirements of the existing statute.  However, several  
          of the service providers opposing this bill argue that adding  
          additional exceptions would be inconsistent with the  
          Legislature's intent to support a competitive market.  The  
          Legislature must weigh the desire to ensure public safety and  
          notification of service outages against the desires of the  
          service providers to prohibit any additional regulatory  
          requirements. 

          Is the threshold to low?  This bill proposes to adopt a rural  
          outage threshold of 30 minutes duration and 75,000 or more  
          user-minutes.  As such an outage of 30 minutes would need to  
          potentially affect 2,500 customers.  If the outage is two hours,  
          then it need only affect 625 customers.  It's unclear whether  








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          75,000 user minutes is the appropriate threshold, though a  
          specified rural threshold should be well under 900,000 user  
          minutes or determined exclusively by the location of the outage.  
           Should this bill move forward the author may wish to consider  
          increasing the threshold while ensuring it remains well-under  
          900,000 user minutes. 

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


            SUPPORT:  

          Access Sonoma Broadband
          American Heart Association
          American Stroke Association
          Branagh Information Group Inc.
          Broadband Alliance of Mendocino County
          California Center for Rural Policy
          California Fire Chiefs Association
          California Police Chiefs Association
          California State Sheriffs' Association
          Communications Workers of America, District 9 AFL-CIO
          Consumer Federation of California
          Fire Districts Association of California
          Humboldt County Board of Supervisors
          Marin County Board of Supervisors
          Mendocino Coast Broadband Alliance
          Mendocino County Board of Supervisors
          Monterey County Business Council
          North Bay-North Coast Broadband Consortium
          Rural County Representatives of California
          The Utility Reform Network
          OPPOSITION:

          AT&T
          CTIA
          California Cable & Telecommunications Association
          Consolidated Communications
          Frontier Communications
          Sprint
          T-Mobile
          Verizon

          ARGUMENTS IN SUPPORT:    SB 1250 is simple; require  








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          telecommunications providers to report rural 911 outages to the  
          appropriate public safety agencies.  The author states that  
          failure to report 911 service outages can wreak havoc on rural  
          communities, and put the public's safety unnecessarily at risk.  
          Previous 911 outages along the North Coast have resulted in  
          significant disruptions to the community.   The author further  
          states that over the past few months rural Northern California  
          communities were affected by several service outages resulting  
          in 911 call centers going offline.  These outages did not reach  
          the Federal NORS thresholds, therefore, telephone utilities were  
          not required to communicate with local and statewide emergency  
          officials.  The California Police Chiefs Association states that  
          providing emergency assistance to every region of California is  
          an essential task of our law enforcement agencies.  To do so  
          requires a functioning 911 system that is maintained at all  
          times.  SB 1250 will help ensure this, and for that reason Cal  
          Chiefs is supporting the measure.

          ARGUMENTS IN OPPOSITION:  Many of the communications companies  
          opposing the bill state the current requirements to report  
          outages are sufficient and don't merit further changes. They  
          also argue against the new threshold for reporting because they  
          believe it is not feasible and would create a new reporting  
          regime. Additionally, many of the communications providers  
          express concerns that the bill would grant the CPUC new  
          regulatory powers and be inconsistent with state policy adopted  
          by the Legislature to prohibit the regulation of VOIP and IP  
          enabled services. 
          

          

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