BILL ANALYSIS �
AB 1027
Page 1
ASSEMBLY THIRD READING
AB 1027 (Buchanan)
As Amended May 11, 2011
Majority vote
UTILITIES & COMMERCE 13-0 LOCAL
GOVERNMENT 9-0
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|Ayes:|Bradford, Fletcher, |Ayes:|Smyth, Alejo, Bradford, |
| |Buchanan, Fong, Fuentes, | |Campos, Davis, Gordon, |
| |Carter, Roger Hern�ndez, | |Hueso, Knight, Norby |
| |Huffman, Knight, Ma, | | |
| |Nestande, Skinner, | | |
| |Swanson | | |
| | | | |
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APPROPRIATIONS 17-0
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|Ayes:|Fuentes, Harkey, | | |
| |Blumenfield, Bradford, | | |
| |Charles Calderon, Campos, | | |
| |Davis, Donnelly, Gatto, | | |
| |Hall, Hill, Lara, | | |
| |Mitchell, Nielsen, Smyth, | | |
| |Solorio, Wagner | | |
| | | | |
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SUMMARY : Requires local publicly owned electric utilities
(POUs), including irrigation districts (IDs), to make
appropriate space and capacity on and in their utility poles and
support structures available for use by cable television
corporations, video service providers, and telephone
corporations. Specifically, this bill :
1)Requires local POUs and IDs to make appropriate space and
capacity on and in a utility pole and support structure owned
or controlled by the local publicly owned electric utility
available for use by a cable television corporation, video
service provider, or telephone corporation.
2)Stipulates that the annual fee charged by a POU for the use of
a utility pole shall not exceed an amount determined by
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multiplying the percentage of the total usable space occupied
by the pole attachment by the annual costs of ownership of the
pole and its supporting anchor.
3)Stipulates that the annual fee charged by a POU for use of a
support structure shall not exceed the POUs annual costs of
ownership, as defined, of the percentage of the volume of the
capacity of the structure rendered unusable by the
telecommunications provider's equipment.
4)Requires the POU board to ensure that neither its customers
nor the telecommunications providers' customers are subsidized
by implementation of this bill's provisions.
FISCAL EFFECT : According to Assembly Appropriations Committee,
negligible state fiscal impact. Any costs of this bill would be
borne by POUs and telecommunications provider customers. POUs
are able to recover their costs through rates charged to their
utility customers.
COMMENTS :
Background . In 1978, to ensure that telephone companies and
electric utilities would not stifle the growth of the
then-fledgling cable television industry by charging excessive
rates for essential pole attachments, Congress enacted the Pole
Attachment Act 1978 (Act). The Act did not require utilities to
give cable operators access to their facilities but merely
limited the rates they could charge if they chose to give such
access. Municipal utilities' and co-ops' pole attachments are
not subject to Federal Communication Commission's (FCC's)
jurisdiction because they are exempt from the federal Act. On
April 7, 2011, FCC reformed its pole attachment rules for
regulated utilities to "streamline access and reduce costs for
attaching broadband lines and wireless antennas to utility
poles.
Issue . POUs currently have the sole discretion over the rates
they charge communications
providers for pole attachments. This bill creates a process for
POUs to determine pole attachment rates by multiplying the
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percentage of the total usable space which is occupied by the
pole attachment by the annual costs of ownership of the pole and
its supporting anchor.
Support . According to the author, this bill, sponsored by the
California Cable and Telecommunications Association, creates a
public and transparent process for local POUs and IDs to
establish fair and reasonable pole attachment rates. Under the
current process, cable and telephone companies are often charged
very different pole attachment rates for poles in similar
locations, based solely on whether or not the pole is owned by a
local POU or investor owned utility.
Opposition . The Northern California Power Authority and the
California Municipal Utilities Association claim the cost cap
provision would not provide flexibility to determine actual
costs, and if their costs exceed the cap, they would essentially
be subsidizing the cable or telecommunication equipment
provider. According to the Sacramento Municipal Utility
District (SMUD), this bill would prohibit POUs from recovering
the costs associated with the specialized attachments for cell
phone antennas that are placed on top of the utility poles,
resulting in higher costs to SMUD ratepayers. The most recent
amendments have attempted to address these subsidy concerns.
Analysis Prepared by : DaVina Flemings / U. & C. / (916)
319-2083
FN: 0000729