Bill Text: CA SB1040 | 2009-2010 | Regular Session | Amended

NOTE: There are more recent revisions of this legislation. Read Latest Draft

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Bill Title: Telecommunications universal service programs:

Spectrum: Partisan Bill (Democrat 1-0)

Status: (Passed) 2010-09-27 - Chaptered by Secretary of State. Chapter 317, Statutes of 2010. [SB1040 Detail]

Download: California-2009-SB1040-Amended.html

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BILL NUMBER: SB 1040	AMENDED
	BILL TEXT

	AMENDED IN ASSEMBLY  JUNE 23, 2010
	AMENDED IN ASSEMBLY  JUNE 21, 2010
	AMENDED IN ASSEMBLY  JUNE 10, 2010
	AMENDED IN SENATE  APRIL 27, 2010
	AMENDED IN SENATE  APRIL 13, 2010

INTRODUCED BY   Senator Padilla

                        FEBRUARY 12, 2010

   An act to amend Section 281 of the Public Utilities Code, relating
to telecommunications, and declaring the urgency thereof, to take
effect immediately.



	LEGISLATIVE COUNSEL'S DIGEST


   SB 1040, as amended, Padilla. Telecommunications universal service
programs: California Advanced Services Fund.
   The existing federal Telecommunications Act of 1996 establishes a
program 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. The universal service principles include the principle
that consumers in all regions of the nation, including low-income
consumers and those in rural, insular, and high-cost areas, should
have access to telecommunications and information services, including
interexchange services and advanced telecommunications and
information services, that are reasonably comparable to those
services provided in urban areas and that are available at rates that
are reasonably comparable to rates charged for similar services in
urban areas.
   Under existing law, the Public Utilities Commission has regulatory
authority over public utilities, including telephone corporations,
as defined. Existing law, until January 1, 2013, establishes the
California Advanced Services Fund (CASF) in the State Treasury, and
requires a surcharge, which is imposed by the commission and
collected through retail telecommunications customers' bills, to be
deposited in that fund. Existing law prohibits the commission from
collecting more than $100,000,000 through the surcharge. Existing law
requires the commission to develop, implement, and administer the
CASF to provide for transfer payments to encourage deployment of
high-quality advanced communications services to all Californians
that will promote economic growth, job creation, and substantial
social benefits of advanced information and communications
technologies, as provided in a specified decision of the commission.
Existing law requires the commission to conduct both a financial
audit and a performance audit on the implementation and effectiveness
of CASF and to report its findings to the Legislature by December
31, 2010.
   This bill would extend the operation of these provisions
indefinitely, and would prohibit the commission from collecting more
than $225,000,000 through the CASF surcharge pursuant to a specified
schedule.  The bill would establish 3 accounts within the fund
and allocate a portion of the additional $125,000,000 that the bill
authorizes to be collected, to be deposited into each of the
accounts, for specified uses.  The bill would require the
commission to conduct an interim and final financial audit and
interim and final performance audit on the implementation and
effectiveness of CASF and to report to the Legislature its interim
findings by December 31, 2010, and its final findings by April 1,
2017. The bill would require the commission to annually provide a
report to the Legislature, until January 1, 2016, relating to the
CASF and containing specified information.
   This bill would declare that it is to take effect immediately as
an urgency statute.
   Vote: 2/3. Appropriation: no. Fiscal committee: yes.
State-mandated local program: no.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:

  SECTION 1.  Section 281 of the Public Utilities Code is amended to
read:
   281.  (a) The commission shall develop, implement, and administer
the California Advanced Services Fund to encourage deployment of
high-quality advanced communications services to all Californians
that will promote economic growth, job creation, and the substantial
social benefits of advanced information and communications
technologies, as provided in Decision 07-12-054 and Decision
09-07-020 and this section. The commission shall establish the
following accounts within the fund:
   (1) The Broadband Infrastructure Grant Account.
   (2) The Rural and Urban Regional Broadband Consortia Grant
Account.
   (3) The Broadband Infrastructure Revolving Loan Account.
   (b) (1) All moneys collected by the surcharge authorized by the
commission pursuant to Decision 07-12-054, whether collected before
or after January 1, 2009, shall be transmitted to the commission
pursuant to a schedule established by the commission. The commission
shall transfer the moneys received to the Controller for deposit in
the California Advanced Services Fund. Moneys collected after January
1, 2011, shall be deposited in the following amounts in the
following accounts:
   (A) One hundred million dollars ($100,000,000) into the Broadband
Infrastructure Grant Account.
   (B) Ten million dollars ($10,000,000) into the Rural and Urban
Regional Broadband Consortia Grant Account.
   (C) Fifteen million dollars ($15,000,000) into the Broadband
Infrastructure Revolving Loan Account.
   (2) All interest earned on moneys in the fund shall be deposited
in the fund.
   (3) The commission shall not collect moneys, by imposing the
surcharge described in paragraph (1) for deposit in the fund, in an
amount that exceeds one hundred million dollars ($100,000,000) before
January 1, 2011. After January 1, 2011, the commission may collect
an additional sum not to exceed  twenty-five million dollars
($25,000,000) per year beginning with the calendar year starting on
January 1, 2011, and continuing through the 2015 calendar year
  one hundred twenty-five million dollars ($125,000,000)
 , for a sum total of moneys collected by imposing the
surcharge described in paragraph (1) not to exceed two hundred
twenty-five million dollars ($225,000,000).  The commission may
collect the additional sum beginning with the calendar year starting
on January 1, 2011, and continuing through the 2015 calendar year, in
an amount not to exceed twenty-five million dollars ($25,000,000)
per year, unless the commission determines that collecting a higher
amount in any y   ear will not result in an increase in the
total amount of all surcharges collected from telephone customers
that year. 
   (c) (1) All moneys in the California Advanced Services Fund shall
be available, upon appropriation by the Legislature, to the
commission for the program administered by the commission pursuant to
this section, including the costs incurred by the commission in
developing, implementing, and administering the program and the fund.

   (2) Notwithstanding any other law and for the sole purpose of
providing matching funds pursuant to the federal American Recovery
and Reinvestment Act of 2009 (Public Law 111-5), any entity eligible
for funding pursuant to that act shall be eligible to apply to
participate in the program administered by the commission pursuant to
this section, if that entity otherwise satisfies the eligibility
requirements under that program. Nothing in this section shall impede
the ability of an incumbent local exchange carrier, as defined by
subsection (h) of Section 251 of Title 47 of the United States Code,
that is regulated under a rate of return regulatory structure, to
recover, in rate base, California infrastructure investment not
provided through federal or state grant funds for facilities that
provide broadband service and California intrastate voice service.
   (d) Moneys in the Rural and Urban Regional Broadband Consortia
Grant Account shall be available for grants to eligible consortia to
fund the cost of broadband deployment activities other than the
capital cost of facilities, as specified by the commission. An
eligible consortium may include, as specified by the commission,
representatives of organizations, including, but not limited to,
local and regional government, public safety, K-12 education, health
care, libraries, higher education, community-based organizations,
tourism, parks and recreation, agricultural, and business, and is not
required to have as its lead fiscal agent an entity with a
certificate of public convenience and necessity.
   (e) Moneys in the Broadband Infrastructure Revolving Loan Account
shall be available to finance capital costs of broadband facilities
not funded by a grant from the Broadband Infrastructure Grant
Account. The commission shall periodically set interest rates on the
loans based on surveys of existing financial markets.
   (f) (1) The commission shall conduct an interim and final
financial audit and an interim and final performance audit of the
implementation and effectiveness of the California Advanced Services
Fund to ensure that funds have been expended in accordance with the
approved terms of the grant awards and loan agreements and this
section. The commission shall report its interim findings to the
Legislature by December 31, 2010. The commission shall report its
final findings to the Legislature by April 1, 2017. The reports shall
also include an update to the maps in the final report of the
California Broadband Task Force and data on the types and numbers of
jobs created as a result of the program administered by the
commission pursuant to this section.
   (2) (A) The requirement for submitting a report imposed under
paragraph (1) is inoperative on January 1, 2018, pursuant to Section
10231.5 of the Government Code.
   (B) A report to be submitted pursuant to paragraph (1) shall be
submitted in compliance with Section 9795 of the Government Code.
   (g) (1) Beginning on January 1, 2012, and annually thereafter, the
commission shall provide a report to the Legislature that includes
all of the following information:
   (A) The amount of funds expended from the California Advanced
Services Fund in the prior year.
   (B) The recipients of funds expended from the California Advanced
Services Fund in the prior year.
   (C) The geographic regions of the state affected by funds expended
from the California Advanced Services Fund in the prior year.
   (D) The expected benefits to be derived from the funds expended
from the California Advanced Services Fund in the prior year.
   (E) Actual broadband adoption levels from the funds expended from
the California Advanced Services Fund in the prior year.
   (F) The amount of funds expended from the California Advanced
Services Fund used to match federal funds.
   (G) An update on the expenditures from California Advanced
Services Fund and broadband adoption levels, and an accounting of
remaining unserved and underserved areas of the state.
   (2) (A) The requirement for submitting a report imposed under
paragraph (1) is inoperative on January 1, 2016, pursuant to Section
10231.5 of the Government Code.
   (B) A report to be submitted pursuant to paragraph (1) shall be
submitted in compliance with Section 9795 of the Government Code.
  SEC. 2.  This act is an urgency statute necessary for the immediate
preservation of the public peace, health, or safety within the
meaning of Article IV of the Constitution and shall go into immediate
effect. The facts constituting the necessity are:
   Numerous grant applications with merit have been filed seeking
funding through the California Advanced Services Fund, many of these
applications also seeking funding through the federal American
Recovery and Reinvestment Act of 2009 (Public Law 111-5), and these
grant applications threaten to exceed the existing financial limits
of the fund. In order to relieve financial pressure on the fund,
enable meritorious projects to go forward, and to prevent a potential
disruptive effect on the grant process, it is necessary that this
act take effect immediately.