BILL ANALYSIS �
AB 841
Page 1
ASSEMBLY THIRD READING
AB 841 (Buchanan)
As Amended May 23, 2011
2/3 vote. Urgency
UTILITIES & COMMERCE 14-0
APPROPRIATIONS 17-0
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|Ayes:|Bradford, Fletcher, |Ayes:|Fuentes, Harkey, |
| |Buchanan, Fong, Fuentes, | |Blumenfield, Bradford, |
| |Furutani, Roger | |Charles Calderon, Campos, |
| |Hern�ndez, Huffman, | |Davis, Donnelly, Gatto, |
| |Knight, Ma, Nestande, | |Hall, Hill, Lara, |
| |Skinner, Swanson, Valadao | |Mitchell, Nielsen, Norby, |
| | | |Solorio, Wagner |
|-----+--------------------------+-----+--------------------------|
| | | | |
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SUMMARY : Authorizes the California Public Utilities Commission
(PUC) to require interconnected Voice over Internet Protocol
(VoIP) service providers to collect and remit surcharges on
their California intrastate revenues in support of the universal
service funds.
FISCAL EFFECT : According to Assembly Appropriations Committee,
no additional state costs, as the PUC has recently opened a
proceeding on this specific topic.
COMMENTS : According to the author, as consumers move from
traditional wireline communications towards technology such as
VoIP, the result is a reduction in the traditional wireline
revenue. The state must adapt to this changing environment in
order to ensure the universal service funds are protected.
Although California interconnected VoIP providers connect to the
public switched telephone network and benefit from the state
universal service programs, these customers do not contribute to
the state universal service funds. AB 841 (Buchanan) addresses
this by requiring interconnected VoIP providers to contribute to
the state universal service funds in a manner consistent with
federal law.
Background : Universal service has been an important public
policy objective on both the federal and state level. The
AB 841
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United States Congress first made universal service a basic goal
of telecommunications policy with the passage of the
Communications Act of 1934. In 1983, the California Legislature
enacted the Moore Universal Telephone Service Act to ensure that
consumers have access to basic voice service that is both
affordable and ubiquitously available.
To achieve this legislative goal, the PUC established universal
service programs:
1)California High-Cost Fund A, which provides direct support to
the 14 small rural telephone companies that are under rate of
return regulation.
2)California High-Cost Fund B, which provides support for large
local exchange carriers (AT&T, Verizon, Frontier, and
SureWest) for the high-cost areas of their service territories
where the cost of providing basic service exceeds $36 per
month.
3)California Advanced Services Fund, which is intended to
promote universal service in unserved and underserved areas in
the state by awarding funding to qualifying certificated
applicant carriers.
4)California LifeLine, which provides discounted basic telephone
(landline) services to eligible California households.
5)California Teleconnect Fund which is a program to provide 50%
discount on selected telecommunications services to qualifying
schools, libraries, government-owned and operated hospitals
and health clinics, and community based organizations.
6)Deaf and Disabled Telecommunications Program, which has two
components: a dual party relay system known as California
Relay Service (CRS) and a specialized equipment program known
as California Telephone Access Program (CTAP). Subsequent
legislation expanded DDTP to serve California individuals with
hearing, vision, speech, cognitive and mobility disabilities.
Due to the increasing customer migration to VoIP services, VoIP
customers presently do not contribute to the California
universal service programs. In order to level the playing
field, this bill authorizes PUC to require interconnected VoIP
service providers to collect and remit surcharges on their
AB 841
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California intrastate revenues in support of the universal
service funds.
On January 13, 2011, PUC opened a rulemaking to address whether
to require interconnected VoIP service providers within
California to collect and remit state public purpose program
surcharges on intrastate revenues. It is unclear what progress
PUC has made on this issue.
The most recent amendments seek to clarify that this bill only
addresses the collection of the specified state surcharge funds
by VoIP providers.
Analysis Prepared by : DaVina Flemings / U. & C. / (916)
319-2083
FN: 0001098