BILL ANALYSIS Ó
AJR 39
Page 1
ASSEMBLY THIRD READING
AJR 39 (Roger Hernández)
As Amended March 13, 2014
Majority vote
UTILITIES & COMMERCE 12-0
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|Ayes:|Bradford, Bonilla, | | |
| |Buchanan, Dahle, | | |
| |Jones-Sawyer, Garcia, | | |
| |Roger Hernández, Jones, | | |
| |Mullin, Quirk, Rendon, | | |
| |Skinner | | |
|-----+--------------------------+-----+--------------------------|
| | | | |
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SUMMARY : Urges the United States Congress to amend a specified
federal law to allow states and their municipalities to
determine the best use of public, education, and government
(PEG) channel support.
FISCAL EFFECT : Unknown. This resolution is keyed non-fiscal by
the Legislative Counsel.
COMMENTS : According to the author, "in this modern age,
residents rely on information to be delivered via public,
educational and government channels. These PEG channels offer
residents an opportunity to become fully aware of what is taking
place in their local communities. Public-access channels allow
citizens to become better informed on local decisions by their
elected representatives, educational and cultural programming.
Currently, PEG funds are restricted to the use of capital
expenses, such as equipment, maintenance, upgrades, and sets,
but cannot be used for legitimate operational expenses such as
labor, administration or research. Assembly Joint Resolution
(AJR) 39 urges Congress to allow states and their municipalities
to determine the best use of public, educational and government
funds."
1)Background : PEG channels are public access channels that
afford citizens with the
opportunity to connect with their communities, engage in civic
activity, and obtain cultural information. Although PEG
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channels are not mandated by federal law, the law stipulates
how PEG channels fees can be used by local franchising
authorities. Cable subscribers pay 5% of their bill as a
franchise fee to the local government, and local governments
cannot impose additional costs beyond that 5%. However,
federal law does require a cable television service provider
to set aside channel capacity and provide financial support
for PEG access channels and restricts PEG channel funds to
capital expenses such as equipment, maintenance, upgrades and
studio staging. The federal government wanted to ensure local
governments were contributing to the community as well, thus
limiting the 1% PEG fee to capital expenditures. This
provision has not been updated in federal law since 1984.
In 2006, the Legislature passed the Digital Infrastructure and
Video Competition Act (DIVCA) with goals to promote rapid,
widespread competition in broadband and video markets and
accelerate the deployment of additional infrastructure in
California. DIVCA is implemented by the California Public
Utilities Commission (PUC) and addresses video franchising and
other broadband related issues. DIVCA fundamentally changed
video franchising within California by transferring the
authority for issuing franchises for the provision of video
services from local entities to the State of California.
Historically, local entities, primarily cities, counties and
special districts issued cable television franchises. This
required cable operators to negotiate separate franchise
agreements with each locality where they wished to provide
video service.
Some jurisdictions used PEG fees to open PEG access centers.
These centers provide community groups and individuals free
access to video production facilities and equipment.
According to the author, since 2007 approximately 51 PEG
access centers have closed. It is unknown how many of these
centers remain open.
Some may argue that at the time the United States Federal
Communications Commission (FCC) began requiring cable
operators to provide local origination programming to connect
communities, mass communication was limited to local
newspapers, public broadcasting, and cable television systems.
Today, individuals can communicate to their communities
through emerging broadband technologies like Twitter, YouTube,
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and Facebook, enhancing the right to "freedom of speech" to
new levels. With the availability of these new and emerging
technologies, requiring cable companies to continue to provide
a channel for PEG programming may no longer be necessary.
2)A message to Congress : In light of the concerns raised by
local jurisdictions, that have
excessively low PEG channel revenue streams and caused PEG
centers to close their operations, this AJR specifically calls
on the U.S. Congress to amend Section 542 of Title 47 of the
US Code to:
a) Allow states and their municipalities to determine the
best use of PEG channel support.
b) Restore and protect funding for PEG operations.
c) To allow states and local governments the flexibility to
use PEG funding for legitimate expenses other than capitol
expenses.
d) Ensure PEG channels are transmitted without charge to
local governments.
3)Support : The City of Whittier writes in support of this
resolution. The City operates one PEG channel to show City
Council meetings, Planning Commission meetings, public
hearings, candidate forums, and other events important to the
community. According to the City, "our residents are
typically very engaged in local issues and rely on this
information to develop their opinions so they can provide
educated public input to local governance. The Whittier City
Council unanimously supports the PEG channel as a very
effective means of making government activities transparent
and open.
"AJR 39 is important to the City of Whittier as it will remove
use restrictions on PEG channel access fees and prevent video
providers from charging municipalities for transmission of PEG
channels. The measure will allow us the flexibility to use
PEG funding for operational expenses as well as capital
expenses."
The Marin Telecommunications Agency (MTA) supports this
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resolution. MTA administers video franchises and contracts
with a nonprofit organization to operate PEG access channels,
and operate and manage the Media Center for public, education
and government use to develop programming for the PEG.
According to MTA, "AJR 39 will provide solutions for critical
and immediate threats to PEG channels and facilities in
California and across the country by removing use restrictions
on PEG channel access fees, restoring PEG channel revenue
streams, and preventing video providers from charging
municipalities for the transmission of the PEG channels."
4)Opposition : The California Cable & Telecommunications
Association (CCTA) opposes
this resolution noting that pursuant both federal and state
law, in most cases cable operators provide 1 percent of their
gross revenues in a franchise area to support the capital
costs associated with providing PEG programming. CCTA argues
that state law requires cable and video companies to provide
dedicated channels for PEG programming. CCTA points out that
"while federal law limits the use of the PEG fee to
exclusively support the capital costs associated with PEG
programming, cable operators also pay local governments an
additional 5 percent of their gross revenues as a franchise
fee that can be used without restriction to cover general
government expenses, including non-capital costs of PEG."
Further, many local governments have the resources to
contribute their share to this partnership if they deem it a
valuable public service to their citizens. According to CCTA,
"given the funding currently available to local governments
that can be used to pay for any costs associated with the
provision of PEG, there simply is no basis to assume that
local governments cannot now provide full funding support for
PEG programming."
Analysis Prepared by : DaVina Flemings / U. & C. / (916)
319-2083
FN: 0003095
AJR 39
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