Bill Text: CA AB1407 | 2013-2014 | Regular Session | Amended
Bill Title: Public utilities: voice communications service: lifeline program.
Spectrum: Partisan Bill (Democrat 1-0)
Status: (Engrossed - Dead) 2013-08-30 - In committee: Held under submission. [AB1407 Detail]
Download: California-2013-AB1407-Amended.html
BILL NUMBER: AB 1407 AMENDED
BILL TEXT
AMENDED IN SENATE AUGUST 12, 2013
AMENDED IN SENATE JUNE 10, 2013
AMENDED IN ASSEMBLY APRIL 16, 2013
INTRODUCED BY Assembly Member Bradford
MARCH 13, 2013
An act to amend Sections 871.5 and 873 of, to add Sections
875.5 and 1001.7 to, to repeal Sections 871.7, 878,
879, 879.5, 880, 882, and 883 of, and to repeal and add
Sections 872, 874, 875, 876, and 877 , and
878 of, the Public Utilities Code, relating to public
communications.
LEGISLATIVE COUNSEL'S DIGEST
AB 1407, as amended, Bradford. Public utilities: voice
communications service: lifeline program.
Existing law, the federal Telecommunications Act of 1996,
establishes a program of cooperative federalism for the regulation of
telecommunications to attain the goal of local competition, while
implementing specific, predictable, and sufficient federal and state
mechanisms to preserve and advance universal service, consistent with
certain universal service principles. Under the act, universal
service is an evolving level of telecommunications services that the
Federal Communications Commission is required to establish
periodically, taking into account advances in telecommunications and
information technologies and services. Pursuant to the act, the
Federal Communications Commission has established and revised a
lifeline program that is available for qualifying low-income
consumers.
Under existing law, the Public Utilities Commission has regulatory
authority over public utilities, including telephone corporations.
The Moore Universal Telephone Service Act establishes the Universal
Lifeline Telephone Service program in order to provide low-income
households with access to affordable basic residential telephone
service. Existing law establishes the Universal Lifeline Telephone
Service Trust Administrative Committee Fund in the State Treasury.
This bill would recast the Moore Universal Telephone Service Act
so that it would provide a household, as defined, having an eligible
customer, as defined, with high-quality voice communications service
at affordable rates. The bill would state the intent of the
Legislature to ensure that California residents have access to
technologies and services and to promote technological neutrality by
giving lifeline customers the ability to choose the communications
provider and service that best meet their unique needs, while
encouraging providers to participate in the lifeline program.
The Moore Universal Telephone Service Act requires the Public
Utilities Commission to annually designate a class of lifeline
service necessary to meet minimum residential, as defined,
communications needs, to set the rates and charges for that service,
to develop eligibility criteria for that service, and to assess the
degree of achievement of universal service, including telephone
penetration rates by income, ethnicity, and geography.
The bill would instead require the Public Utilities Commission to
annually develop eligibility criteria for customers to participate in
the program, assess the penetration rates for lifeline service by
income, ethnicity, and geography, and to prepare and submit a report
to the Legislature on the fiscal status of the lifeline program that
includes a statement of the lifeline program surcharge level and
revenues produced by the surcharge, the size of the Universal
Lifeline Telephone Service Trust Administrative Committee Fund, the
reason for a decline or increase in the size of the fund, if
applicable, an accounting of program expenses, and an evaluation of
options for controlling those expenses and increasing program
efficiency.
The Moore Universal Telephone Service Act requires that the
Universal Lifeline Telephone Service rates be set at no more than 50%
of either the basic rate for measured residential telephone service
or the basic flat residential telephone rate service, as applicable,
exclusive of federally mandated end user access charges that are
available to the residential subscriber. Existing law requires that
the lifeline telephone service installation or connection charge, or
both, be not more than 50% of the charge for basic residential
service installation or connection.
The bill would repeal these requirements and instead require that
through and including December 31, 2014, the nonrecurring service
charge for commencing voice service for a single voice connection for
a lifeline customer be no greater than $10. Until and including
December 31, 2014, the lifeline provider would be eligible for
reimbursement from the fund for the difference between the
nonrecurring charge paid by a lifeline subscriber and the
nonrecurring charge the lifeline provider charges for identical
services in the ordinary course of business to subscribers that are
not eligible customers, subject to the limitation that the
reimbursement can be no more than $40 per connection. Beginning
January 1, 2015, the Public Utilities Commission would be authorized
to annually increase the nonrecurring service charge incurred by
eligible customers, and the lifeline provider connection
reimbursement, by an amount in proportion to the increase, if any, to
the Consumer Price Index for All Urban Consumers (CPI-U). The
bill would authorize the commission to authorize a
lifeline provider to be reimbursed pursuant to these provisions, for
commencing voice service for an eligible customer, only if that
provider is the customer's carrier of last resort for basic service.
The bill would require that every eligible customer be
given a discount of $11.85 per month, in addition to any federally
supported lifeline discount provided to customers of an eligible
telecommunications carrier, and would, beginning January 1, 2015,
authorize the commission to annually adjust the support amount in
proportion to the increase, if any, in the CPI-U. The bill would
provide that an eligible customer is not entitled to any combined
monthly federal and state lifeline support in excess of the customer'
s monthly rate. The bill would require that state lifeline support be
provided only after federal lifeline support, if any, is received by
an eligible customer.
The bill would require that all providers participating in the
California lifeline program offer lifeline service at the same rates
that were in effect on July 1, 2013, through and including December
31, 2014. The bill would require every lifeline provider, on first
contact by a prospective eligible customer, to inform the customer of
the availability of the lifeline discount and how that customer may
qualify for and obtain the discount. The bill would provide that a
lifeline provider that is a prospective eligible customer's carrier
of last resort for basic service remains subject to any customer
notification obligations applicable to the provision of basic
service.
The Public Utilities Act prohibits any telephone corporation from
beginning the construction of, among other things, a line, plant, or
system, or of any extension thereof, without having first obtained
from the commission a certificate that the present or future public
convenience and necessity require or will require that construction
(certificate of public convenience and necessity).
This bill would prohibit the commission from denying or revoking a
certificate of public convenience and necessity applied for by or
issued to a telephone corporation that provides retail or wholesale
telecommunications services on the grounds that the telephone
corporation also provides Voice over Internet Protocol service or any
other unregulated service.
Under existing law, a violation of the Public Utilities Act or any
order, decision, rule, direction, demand, or requirement of the
commission is a crime.
Because the provisions of this bill would be a part of the act and
would require action by the Public Utilities Commission to implement
its requirements, and because the bill would expand the class of
lifeline providers, the bill would impose a state-mandated local
program by expanding the scope of a crime.
The California Constitution requires the state to reimburse local
agencies and school districts for certain costs mandated by the
state. Statutory provisions establish procedures for making that
reimbursement.
This bill would provide that no reimbursement is required by this
act for a specified reason.
Vote: majority. Appropriation: no. Fiscal committee: yes.
State-mandated local program: yes.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. The Legislature finds and declares all of the
following:
(a) Technological advances in Internet and mobile communications
have resulted in a variety of new voice communications offerings
beyond traditional wireline telephone service, such as mobile
telephony service, commonly known as cellular telephone service, and
Voice over Internet Protocol service.
(b) California consumers are increasingly choosing these new voice
communications services, while conversely, traditional telephone
subscriptions are decreasing.
(c) The Moore Universal Telephone Service Act should be modernized
in order to maintain the vitality of its original policy goals by
acknowledging that technologies, services, and business models other
than traditional telephone service can be used to offer low-income
citizens access to affordable, reliable, and high-quality
communications service.
(d) In enacting this act, it is the intent of the Legislature to
ensure that California residents have access to technologies and
services and to promote technological neutrality by giving lifeline
customers the ability to choose the voice communications service
provider and service that best meets their unique needs, while
encouraging mobile telephony service and other nontraditional
providers to participate in the lifeline program.
SEC. 2. Section 871.5 of the Public Utilities Code is amended to
read:
871.5. The Legislature finds and declares all of the following:
(a) The offering of high-quality voice communications service at
affordable rates to the greatest number of citizens has been a
longstanding goal of the state.
(b) The Moore Universal Telephone Service Act is an important
means for achieving universal service by making voice communications
service affordable to low-income households through the lifeline
program.
(c) The Federal Communications Commission has recently reformed
and modernized the federal universal service fund's lifeline program
by, among other things, adopting a technology neutral approach to
lifeline.
(d) Every means should be employed by the commission to ensure
that every household qualified to receive lifeline support is
informed of and is afforded the opportunity to obtain that support.
Nothing in this section effects an eligible telecommunications
carrier's obligations to advertise the availability of its offerings
and charges for those offerings using media of general distribution
under Section 54.201(d)(2) of Title 47 of the Code of Federal
Regulations. The commission shall not impose any additional
advertising obligations on lifeline providers.
(e) The furnishing of lifeline support is in the public interest.
The commission, in administering the lifeline program, should
implement the program in a way that is equitable, nondiscriminatory,
and without competitive consequences for the telecommunications
industry in California.
SEC. 3. Section 871.7 of the Public Utilities Code is repealed.
SEC. 4. Section 872 of the Public Utilities Code is repealed.
SEC. 5. Section 872 is added to the Public Utilities Code, to
read:
872. As used in this article, the following terms have the
following meanings:
(a) "Eligible customer" means any person who has, after providing
adequate supporting documentation, been determined to be eligible to
receive lifeline support by a third-party lifeline administrator. A
lifeline provider shall not be obligated to provide, nor shall any
person be entitled to receive, any lifeline support until that person
has been determined to be an eligible customer by a third-party
lifeline administrator. A customer applying to become an eligible
customer shall not be required to first establish service as a
condition for lifeline eligibility.
(b) "Household" means any individual or group of individuals who
are living together at the same address as one economic unit. A
household may include related and unrelated persons. An "economic
unit" consists of all adult individuals contributing to and sharing
in the income and expenses of a household. An adult is any person 18
years of age or older. If an adult has no or minimal income, and
lives with someone who provides financial support to him or her, both
people shall be considered part of the same household. Children
under 18 years of age living with their parents or guardians are
considered to be part of the same household as their parents or
guardians.
(c) (1) "Lifeline provider" means any telephone corporation or
alternative provider that meets all of the following requirements:
(A) Provides voice communications services that are eligible for
federal universal service support pursuant to Section 54.101 (a) of
Title 47 of the Code of Federal Regulations.
(B) Collects and remits surcharges for the lifeline
program all universal service programs
funded through those funds created pursuant to Section 270 and for
the emergency telephone system described in Section 41030 of the
Revenue and Taxation Code .
(C) Voluntarily chooses to participate in the lifeline program or
is otherwise mandated to offer basic service as of January
1, 2013 .
(D) Agrees to comply with, and be held liable for any violations
of, this article and any commission rules implementing this article,
as enforced by the commission.
(2) Any "lifeline provider," including a local exchange carrier,
may use any technology, or multiple technologies, within the provider'
s service territory , except as otherwise required pursuant to
the obligation of a carrier of last resort to provide basic service
to any customer upon request, including any eligible customer .
SEC. 6. Section 873 of the Public Utilities Code is amended to
read:
873. The commission shall annually do all of the following:
(a) Develop eligibility criteria for eligible customers to
participate in the lifeline program. The commission shall not
increase lifeline income limits from those in effect on January 1,
2013, except for an annual adjustment to reflect inflation based on
changes to the United States Consumer Price Index for All Urban
Consumers (CPI-U).
(b) Assess the penetration rates for the lifeline program by
income, ethnicity, and geography. This information shall be annually
reported to the Legislature by the commission in a document that can
be made public.
(c) Not withstanding Section 10231.5 of the Government Code, not
later than March 31 of each year, prepare and submit a report to the
Legislature on the fiscal status of the lifeline program. The report
shall be submitted in compliance with Section 9795 of the Government
Code. The report shall include a statement of the lifeline program
surcharge level and revenues produced by the surcharge, the size of
the Universal Lifeline Telephone Service Trust Administrative
Committee Fund, the reason for a decline or increase in the size of
the fund, if applicable, an accounting of program expenses, and an
evaluation of options for controlling those expenses and increasing
program efficiency.
SEC. 7. Section 874 of the Public Utilities Code is repealed.
SEC. 8. Section 874 is added to the Public Utilities Code, to
read:
874. (a) The commission may authorize a lifeline provider to
be reimbursed pursuant to this section for commencing voice service
for an eligible customer only if that provider is the customer's
carrier of last resort for basic service.
(b) Until and including December 31, 2014,
the nonrecurring service charge for commencing voice service for a
single voice connection for a lifeline customer shall be no more than
ten dollars ($10). Until and including December 31, 2014, a lifeline
provider shall be eligible for reimbursement from the Universal
Lifeline Telephone Service Trust Administrative Committee Fund for
the difference between the nonrecurring charge paid by a lifeline
subscriber and the nonrecurring charge the lifeline provider charges
for identical service in the ordinary course of business to
subscribers that are not eligible customers, subject to the
limitation that the reimbursement to the lifeline provider shall be
no more than forty dollars ($40) per connection.
(b)
(c) Beginning January 1, 2015, the commission may
annually increase the nonrecurring service charge incurred by
eligible customers by an amount in proportion to the increase, if
any, to the Consumer Price Index for All Urban Consumers (CPI-U). If
the commission exercises this authority, then it also shall increase
the lifeline provider connection reimbursement by a proportionate
amount.
SEC. 9. Section 875 of the Public Utilities Code is repealed.
SEC. 10. Section 875 is added to the Public Utilities Code, to
read:
875. (a) Except as provided in subdivision (b), every eligible
customer shall be given a discount of eleven dollars and eighty-five
cents ($11.85) per month, in addition to any federally supported
lifeline discount provided to customers of an eligible
telecommunications carrier. Beginning January 1, 2015, the commission
may annually adjust the support amount in proportion to the
increase, if any, in the Consumer Price Index for All Urban Consumers
(CPI-U).
(b) An eligible customer shall not be entitled to any combined
monthly federal and state lifeline support in excess of the eligible
customer's monthly rate. State lifeline support shall be provided
only after federal lifeline support, if any, is received by an
eligible customer. Lifeline providers shall be eligible for
reimbursement from the Universal Lifeline Telephone Service Trust
Administrative Committee Fund in an amount not to exceed the amount
of state lifeline support that is actually received by an eligible
customer.
(c) To the extent necessary to support the lifeline program, the
commission may assess a lifeline surcharge in an amount not to exceed
3.3 percent of the subscriber's charges for intrastate telephone
communications services or interconnected Voice over Internet
Protocol (VoIP) service. The methodology for applying the lifeline
surcharge to interconnected VoIP service shall be that set forth in
subdivision (e) of Section 285.
SEC. 11. Section 875.5 is added to the
Public Utilities Code , to read:
875.5. (a) Through and including December 31, 2014, all providers
participating in the California lifeline program shall offer
lifeline service at the same rates that were in effect on July 1,
2013.
(b) Every lifeline provider, on first contact by a prospective
eligible customer, shall inform the customer of the availability of
the lifeline discount and how that customer may qualify for and
obtain the discount. A provider may present that information orally,
electronically, or in print form.
(c) A lifeline provider that is a prospective eligible customer's
carrier of last resort for basic service shall also remain subject to
any customer notification obligations applicable to the provision of
basic service.
SEC. 11. SEC. 12. Section 876 of the
Public Utilities Code is repealed.
SEC. 12. SEC. 13. Section 876 is
added to the Public Utilities Code, to read:
876. (a) The commission shall, upon a request of a provider,
designate as a lifeline providers
provider a telephone corporation or alternative provider that
meets the requirements of subdivision (c) of Section 872. The
commission shall, upon a request of a provider, designate
the lifeline provider as an eligible telecommunications carrier
shall not, in exercising its delegated authority under
federal law to designate eligible telecommunications carriers, or in
exercising its authority under this section to designate state
lifeline providers, deny a request to be designated based on the
requesting entity providing any VoIP or IP-enabled service .
The commission shall not, as a condition for either designation,
impose any obligation that exceeds the obligations imposed on
state-designated eligible telecommunications carriers in Subpart E
(commencing with Section 54.400) of Part 54 of Title 47 of the Code
of Federal Regulations , except that designation as a lifeline
provider does not eliminate or diminish any obligation of a carrier
of last resort to provide basic service to any customer upon request,
including any eligible customer .
(b) The commission shall require a lifeline provider to offer only
the minimum service elements to eligible lifeline customers set
forth in Section 54.101 (a) of Title 47 of the Code of Federal
Regulations. Lifeline support may be applied to any bundle or package
that includes voice service.
SEC. 13. SEC. 14. Section 877 of the
Public Utilities Code is repealed.
SEC. 14. SEC. 15. Section 877 is
added to the Public Utilities Code, to read:
877. (a) Lifeline discounts shall be limited to one per
household. Nothing in this section effects the ability of a member of
a household to obtain an additional lifeline discount if that member
is medically certified as deaf or hard of hearing and has continuous
access to teletypewriter equipment, or its functional equivalent,
pursuant to Section 2881, and has been determined to be an eligible
customer by a third-party lifeline administrator.
(b) An applicant for lifeline support may report only one address
in the state as a principal place of residence.
SEC. 15. SEC. 16. Section 878 of the
Public Utilities Code is repealed.
SEC. 17. Section 878 is added to the
Public Utilities Code , to read:
878. This article does not eliminate or diminish the obligation
of a carrier of last resort to provide basic service to any customer
upon request, including to any eligible customer.
SEC. 16. SEC. 18. Section 879 of the
Public Utilities Code is repealed.
SEC. 17. SEC. 19. Section 879.5 of
the Public Utilities Code is repealed.
SEC. 18. SEC. 20. Section 880 of the
Public Utilities Code is repealed.
SEC. 19. SEC. 21. Section 882 of the
Public Utilities Code is repealed.
SEC. 20. SEC. 22. Section 883 of the
Public Utilities Code is repealed.
SEC. 21. By May 1, 2014, the Public Utilities
Commission shall revise General Order 153 to bring the lifeline
program into compliance with the changes made by this act. The
commission shall allow a lifeline provider a reasonable period of
time, as determined by the commission, to implement the requirements
or obligations of the Moore Universal Telephone Service Act as
amended by this act. The commission shall not adopt any obligations,
rules, or standards that exceed, or otherwise add to, those that are
expressly required by this act.
SEC. 23. Section 1001.7 is added to the
Public Utilities Code , to read:
1001.7. The commission shall neither deny nor revoke a
certificate of public convenience and necessity applied for by or
issued to a telephone corporation that provides retail or wholesale
telecommunications services on the grounds that the telephone
corporation also provides Voice over Internet Protocol service or any
other unregulated service. This section does not expand the
commission's existing jurisdiction over any service or affect any
provision of Section 710. This section does not give any telephone
corporation any new rights or powers.
SEC. 24. (a) This act does
not create or expand the Public Utilities Commission's jurisdiction
over any provider, service, or technology. In implementing this act,
the commission shall not impose any new obligation, standard, or
requirement upon any provider, service, or technology that is not
expressly required by the act.
(b) By May 1, 2014, the commission shall revise General Order 153
to bring it into compliance with this act. The commission shall
eliminate or modify any rule that imposes substantive requirements
upon lifeline providers beyond the express terms of this act, but may
retain, modify, or enact rules governing the administration of the
lifeline program that are not inconsistent with this act, including
rules governing enrollment processes, eligibility forms, the
third-party administrator, the calculation of the fund and
establishment of the surcharge, reporting and remittances of
surcharges, use of electronic communications, and audits and records.
The commission shall allow a lifeline provider a reasonable period
of time to implement the requirements or obligations of this act.
SEC. 22. SEC. 25. No reimbursement
is required by this act pursuant to Section 6 of Article XIII B of
the California Constitution because the only costs that may be
incurred by a local agency or school district will be incurred
because this act creates a new crime or infraction, eliminates a
crime or infraction, or changes the penalty for a crime or
infraction, within the meaning of Section 17556 of the Government
Code, or changes the definition of a crime within the meaning of
Section 6 of Article XIII B of the California Constitution.
