BILL ANALYSIS �
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THIRD READING
Bill No: SB 740
Author: Padilla (D)
Amended: 5/7/13
Vote: 27 - Urgency
SENATE ENERGY, UTILITIES & COMMUNIC.S COMM. : 10-0, 4/30/13
AYES: Padilla, Cannella, Corbett, De Le�n, DeSaulnier, Hill,
Knight, Pavley, Wolk, Wright
NO VOTE RECORDED: Fuller
SENATE APPROPRIATIONS COMMITTEE : 5-0, 5/23/13
AYES: De Le�n, Hill, Lara, Padilla, Steinberg
NO VOTE RECORDED: Walters, Gaines
SUBJECT : Telecommunications: universal service programs:
California Advance Services Fund
SOURCE : Author
DIGEST : This bill extends the Public Utilities Commissions
(PUC) authority to collect a surcharge on intrastate
communication services from 2015 to 2020 to fund the California
Advanced Services Fund (CASF) and allows entities that are not
telephone corporations to receive funds from the CASF.
ANALYSIS :
Existing law:
1. Establishes the CASF, administered by the PUC, to help fund
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deployment of broadband infrastructure and bring high-speed
Internet access to all areas of the state.
2. Authorizes the PUC to use ratepayer funds collected for
universal service programs, including the CASF, to compensate
regulated telephone corporations for their costs of providing
universal service.
3. Authorizes collection of a customer surcharge on intrastate
communications services of up to $225 million for the CASF
through 2015 with no more than $25 million per year.
This bill:
1. Extends the sunset date that authorizes the PUC to collect
the additional money as specified, until January 1, 2020.
2. Provides that the goal of the CASF program, no later than
December 31, 2015, is to approve funding for infrastructure
projects that will provide broadband access to no less than
98% of California households.
3. Provides that it is the intent of the Legislature is to
authorize collection of additional surcharge amounts
necessary to achieve this program goal.
4. Requires that priority be given to projects that provide
last-mile broadband connection to households that are
unserved by an existing facilities-based broadband provider.
5. Provides that a middle-mile broadband project is eligible
for an infrastructure grant even if it passes through an area
served by an existing facilities-based broadband provider, as
long as the project applicant can demonstrate that the
project provides last-mile broadband connection to households
that are unserved by any existing facilities-based broadband
provider.
6. Authorizes an entity that is not a telephone corporation
otherwise subject to the PUC regulation to be eligible for a
CASF grant if that entity meets eligibility and program
requirements established by the PUC.
7. Provides that a local governmental agency may be eligible
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for an infrastructure grant only if the infrastructure
project is for an unserved area, the PUC has conducted an
open application process and no other eligible entity
applied, and the PUC determines that within the region of the
local agency's jurisdiction there is less than 98% broadband
deployment.
Background
The CASF, administered by the PUC, was established to help fund
deployment of broadband infrastructure and bring high-speed
Internet access to all areas of the state. The PUC is
authorized until 2015 to collect a surcharge on intrastate
communication services, not to exceed $25 million a year or a
total of $225 million over the life of the program.
Prior Legislation
AB 1555 (Perez, Chapter 24, Statutes of 2009) expanded CASF
eligibility to other entities only for the purpose of providing
matching funds made available through the American Reinvestment
and Recovery Act of 2009.
SB 1040 (Padilla, Chapter 317, Statutes of 2010) authorized
collection of an additional $125 million through 2015 (for a
total of $225 million).
FISCAL EFFECT : Appropriation: No Fiscal Com.: Yes
Local: No
According to the Senate Appropriations Committee, there will be
unknown cost pressures, possibly in the hundreds of thousands of
dollars from the CASF (special fund) for expanded grantee
eligibility.
SUPPORT : (Verified 5/23/13)
Congressman Jared Huffman
California Broadband Cooperative
California Center for Rural Policy
Central Coast Broadband Consortium
Central Sierra Connect
Connect Joy Road
Contra Costa Council
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County of Del Norte Board of Supervisors
County of Humboldt Board of Supervisors
County of Lake Board of Supervisors
County of Mendocino Board of Supervisors
County of Mono Board of Supervisors
County of Sonoma Board of Supervisors
County of Tehama Board of Supervisors
Eastern Sierra Connect Regional Broadband Consortium
Fresno State Office of Community and Economic Development
Golden Bear Broadband
Inland Empire Regional Broadband Consortium
Interbahn
Los Angeles County Regional Broadband Consortia
Mendocino Coast Broadband Alliance
Mendocino County Office of Education
Modoc County Office of Education
Praxis Associates
Public Utilities Commission
Rural County Representatives of California
Russian River Fire Protection District
Russian River Rotary Club
Shasta County Health and Human Services Agency
Sierra Economic Development Corporation
Sonoma Connect
Sonoma County Sheriff's Office
Spiral Internet
The Upstate California Connect Consortium
Trinity County Board of Supervisors
Tuolumne County Economic Development Authority
Valley Vision
West Sonoma County Union High School District
Youth Policy Institute
ARGUMENTS IN SUPPORT : California Broadband Cooperative
writes:
As a result of these funds, our company is in the process of
completing a 583 mile fiber optic network (Digital 395) which
will service the Eastern Sierra region of California. The
digital network service area encompasses 36 communities, six
California Indian reservations, two military bases, four major
area hospitals plus more than forty schools and other
educational related facilities.
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The Digital 395 Network will:
Serve more than 237 committed community anchor
institutions, including 35 public safety entities, 47 K-12
schools, 13 libraries, 2 community colleges, and 2
universities, the Sierra Nevada Aquatic Research
Laboratory, Caltech's Owens Valley Radio Observatory, and
White Mountain Research Station, 15 healthcare faculties
and 104 government offices.
Spur affordable broadband access for local consumers and
businesses, including approximately 26,000 households and
2,500 businesses by enabling local Internet service
providers to utilize the project's open network. At least
five existing broadband providers have signed to utilize
the middle mile network to expand their services.
Enable access to educational, medical and commercial
applications for isolated populations on six California
Indian reservations; Big pine Paiute Tribe of the Owens
Valley; Lone Pine Paiute-Shoshone Reservation; Fort
Independence Reservation; Benton Paiute Tribe; Bishop
Paiute Tribe and Bridgeport Indian Colony.
For the first time, high-capacity fiber will be made available
to the region's last mile providers to expand or enhance
service to households and businesses; as well as to government
agencies and carriers seeking local or long-haul transport.
JG:k 5/24/13 Senate Floor Analyses
SUPPORT/OPPOSITION: SEE ABOVE
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