BILL ANALYSIS �
AB 1050
Page 1
ASSEMBLY THIRD READING
AB 1050 (Ma)
As Amended May 27, 2011
Majority vote
UTILITIES & COMMERCE 13-0 REVENUE &
TAXATION 9-0
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|Ayes:|Bradford, Buchanan, Fong, |Ayes:|Perea, Donnelly, Beall, |
| |Fuentes, Furutani, Roger | |Charles Calderon, |
| |Hern�ndez, Huffman, | |Cedillo, Alejo, Gordon, |
| |Knight, Ma, Nestande, | |Harkey, Nestande |
| |Skinner, Swanson, Valadao | | |
|-----+--------------------------+-----+--------------------------|
| | | | |
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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, Norby, | | |
| |Solorio, Wagner | | |
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| | |
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SUMMARY : Requires the Board of Equalization (BOE) to convene a
stakeholder working group, by March 1, 2012, to develop
recommendations for an equitable and uniform method of
collecting state and locally-authorized communications taxes,
fees and surcharges from pre-paid end-use consumers, and to
report its recommendations to the Legislature by April 1, 2013.
Specifically, this bill :
1)Requires BOE to convene a working group, by March 1, 2012, to
develop recommendations for an equitable and uniform method of
collecting state and locally authorized communications taxes,
fees, and surcharges from prepaid communications end-use
customers, and to report its recommendations to the
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Legislature by April 1, 2013.
2)Requires the working group to include stakeholder
representatives from the California Public Utilities
Commission (PUC), the California Technology Agency (CTA),
local government entities, law enforcement agencies, mobile
telephony service providers, retailers, and consumer groups.
3)Declares that maintaining effective and efficient
telecommunications services, 911 emergency systems,
telecommunications-related public policy programs to promote
universal service, and various local programs across the state
benefits all citizens.
4)Finds that consumers purchase prepaid communications services
at a wide variety of retail locations and other distribution
channels, as well as through service providers.
5)Declares prepaid communications services are an important and
growing segment of the communications industry.
6)States that to ensure equitable contributions from end-use
consumers of postpaid and prepaid communications services,
there should be standardization with respect to the method
used to collect communications taxes, fees, and surcharges
from end-use consumers of prepaid communications services.
FISCAL EFFECT : According to the Assembly Appropriations
Committee, the costs should be absorbable for each of the
agencies to participate in the working group which, besides the
BOE, includes the PUC and the California Technology Agency, and
representatives from local government and law enforcement
entities, mobile telephony service providers, retailers, and
consumer groups.
Given the absorbable costs for the working group and the
development of recommendations, the bill does not need to be
subject to an appropriation, as it is now.
COMMENTS : According to the author, this bill is intended to
create a fair, uniform mechanism to ensure collection of state
and local communications taxes and fees from consumers of
prepaid wireless communication services.
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Surcharges : Current law imposes the state 911 surcharge, as
well as a variety of public purpose surcharges for low-income,
and rural assistance programs, and programs for the disabled.
The surcharges are calculated based on the amount paid for all
phone calls that originate and end within the state. These
intrastate calls are the only calls over which any state has the
authority to impose a surcharge. Current law also specifies
that the surcharge is to be imposed at the time of billing.
Specifically, these taxes and fees include:
1)Surcharges authorized pursuant to the Emergency Telephone
Users Surcharge Act.
2)Public Utilities Commission surcharges including:
a) California High Cost Fund - A program;
b) California High Cost Fund - B program;
i) Deaf and Disabled Telecommunications Program;
ii) California Teleconnect Fund;
iii) The California Advanced Services Fund;
iv) Lifeline Program; and,
v) Public Utilities Commission reimbursement fees.
3)Local 911 or access line taxes, fees, or surcharges.
4)Local utility user taxes.
Level the playing field : Since most prepaid customers do not
have a direct relationship with a carrier, and do not enter into
a contract with a monthly bill, there is no statewide mechanism
to collect the same communications taxes and fees from prepaid
wireless customers that are presently collected from postpaid
services. As a result, the state and local governments have no
reliable means for ensuring collection of these revenues. In
other words, these entities lose revenues for important services
and programs. This bill seeks to alleviate the hurdles of
assessing surcharges on prepaid wireless communication services
by developing a uniform statewide collection mechanism.
AB 1050
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Analysis Prepared by : DaVina Flemings / U. & C. / (916)
319-2083
FN:
0001118