BILL ANALYSIS
SB 1040
Page 1
SENATE THIRD READING
SB 1040 (Padilla)
As Amended August 16, 2010
2/3 vote. Urgency
SENATE VOTE :33-0
UTILITIES & COMMERCE 9-3
APPROPRIATIONS 12-5
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|Ayes:|Buchanan, Carter, Fong, |Ayes:|Fuentes, Bradford, |
| |Furutani, Huffman, Ma, | |Huffman, Coto, Davis, De |
| |Skinner, Swanson, | |Leon, Gatto, Hall, |
| |Bradford | |Skinner, Solorio, |
| | | |Torlakson, Torrico |
| | | | |
|-----+--------------------------+-----+--------------------------|
|Nays:|Knight, Fuller, Villines |Nays:|Conway, Harkey, Miller, |
| | | |Nielsen, Norby |
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SUMMARY : Authorizes telecommunications carriers to collect an
additional $125 million for the California Advanced Services
Fund (CASF) to encourage deployment of advanced communications
services in California.
EXISTING LAW requires the California Public Utilities Commission
(PUC) to develop and administer CASF to encourage deployment of
high-quality advanced communications services, sunsets January
1, 2013, and restricts the collection of funds for CASF to not
more than $100 million.
FISCAL EFFECT :
1)Up to $125 million in additional special fund program
expenditures over six years and possibly longer.
2)Administrative costs to PUC will be as follows:
a) Current annual costs of $175,000 for 2.0 positions will
be extended at least five more years;
b) One-time costs of $110,000 for 1.0 position in 2011-12
SB 1040
Page 2
associated with a rule-making for the consortia grant
program and the revolving loan program; and,
c) Ongoing costs of $350,000 beginning in 2011-12 and
continuing for at least five years for 3.0 positions
associated with the new grant and loan programs.
COMMENTS : In 2007, PUC created CASF to help promote the
deployment of broadband infrastructure in unserved areas of the
state. As part of the decision, PUC required telephone
corporations to assess a surcharge on telephone ratepayers to
fund the program. When the Legislature found that the PUC was
assessing the surcharge without statutory authority, it passed
SB 1193 (Padilla) Chapter 393, Statutes of 2008, to provide that
authority. However, SB 1193 restricted collection to not more
than $100 million and sunset the provision on January 31, 2013.
The PUC has only awarded $54 million from the first $100
million. SB 1193 required PUC to conduct both a financial audit
and a performance audit of the implementation and effectiveness
of CASF to ensure that moneys have been appropriately expended
in accordance with bidding procedures and programmatic
parameters. PUC is required to report its findings to the
Legislature by April 1, 2011.
Analysis Prepared by : Gina Adams / U. & C. / (916) 319-2083
FN: 0005956