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On January 29, 2015, the Commission held its regularly-scheduled agenda meeting.  Although there were no telecommunications items addressed on the regular agenda, the water-energy nexus proceeding was expanded to the include telecommunications companies on the consent agenda.  In addition, the Safety and Enforcement Division and the Policy and Planning Division gave an extensive presentation on a proposed Safety Plan.  These and other items of interest are discussed in further detail below.
 
CONSENT AGENDA
 
Scope of Water-Energy Nexus Proceeding Extended to Include Telecommunications Companies (Item 9, approved on consent) – This Decision extends the scope of the Water-Energy Nexus rulemaking to incorporate telecommunications and public safety issues.  The rulemaking was initially opened in December 2013 with the goal of reducing energy consumption by the water sector in supplying, conveying, treating, and distributing water.  The Decision explains that telecommunications and internet facilities and services are increasingly crucial to water management, use, and public safety, and that there are exemplary instances where advanced telecommunications technologies can greatly facilitate water-saving activities.  Accordingly, the Decision concludes that it would be appropriate to expand the scope of the proceeding to telecommunications companies.
 
A copy of the Proposed Decision underlying this item is available at the following link:
 
Sage Telecom Conditionally Granted ETC Status (Item 15, approved consent) – This Resolution conditionally grants the request of Sage Telecom Communications, LLC (“Sage”) to be designated as an Eligible Telecommunications Carrier (“ETC”) to provide federal Lifeline wireless service to qualifying customers in California in the service areas of the Uniform Regulatory Framework (“URF”) carriers, and specifically excluding the Small Local Exchange Carriers’ (“Small LECs”) service areas.  Sage is a wireless service provider with principal offices in Dallas, Texas, and was issued a Wireless Registration by the Commission on July 12, 2013.  Sage is a wholly-owned subsidiary of TSC Acquisition Corporation, which offers wireless/mobile services on a common carrier basis in twenty-six states, and has been designated as a federal ETC in four of those states. 
 
This Resolution authorizes Sage to offer the following two wireless service plans in California: (1) a free 300 minute plan at no charge per month to a customer; and (2) an unlimited talk and text plan with 100 MB of data for $30.75 per month to a customer.  The Resolution further directs Sage to: (1) comply with all applicable state and consumer protection and service quality standard requirements; (2) submit all federal and state required annual compliance reports; (3) provide marketing materials to the CPUC for review prior to distribution and publication; (4) comply with CPUC User Fee and public purpose program surcharge requirements; and (5) requires Sage to submit its certificate of approval from USAC to the Communications Division Director.
 
A copy of the Draft Resolution underlying this item is available at the following link:
 
Logical Telecom Granted a CPCN (Item 18, approved on consent) – This Decision approves a settlement agreement and grants Logical Telecom, LP (“Logical”) a certificate of public convenience and necessity (“CPCN”) to provide interexchange service in California.  Logical is a Texas-based limited partnership that was previously granted a CPCN to provide interexchange services in 2006, which Logical had voluntarily surrendered in 2010.  The Decision does not explain why Logical surrendered its CPCN in 2010.
 
Logical submitted its request for CPCN authority in 2013, which was protested by the Safety and Enforcement Decision (“SED”).  SED alleged that Logical continued to operate in California and provided intrastate services without a license since 2010, when Logical surrendered its previous CPCN.  The Decision explains that SED conducted an investigation into the operability of Logical’s prepaid card offerings and business practices, and found the following problems: (1) certain cards and advertising materials attempted to reserve the right to change rates and terms or conditions by labeling the disclosed rate as “promotional” or “subject to change”; (2) some cards failed to disclose the value of the card and ancillary charges; and (3) some advertising materials failed to disclose the geographical limitations against intrastate calling.  SED’s investigation also revealed: (1) that some cards would reduce in value for calls that were not connected; (2) some cards listed inactive customer support numbers; (3) discrepancies in the voice prompt stating the number of minutes remaining and the actual number of minutes provided; and (4) different incurred rates than what was stated on the cards.
 
SED and Logical subsequently negotiated a settlement agreement, in which Logical: (1) acknowledges that it allowed its prepaid phone cards to be sold in California without authority and that some of its prepaid phone cards and advertising material did not meet state requirements; (2) affirms it will not increase rates or assess charges above the amount disclosed on the cards, packaging, or other advertising statements made at the time of sale of the card; (3) will pay $120,000 to the State of California General Fund; and (4) agrees to submit its top selling prepaid cards to the Commission for further compliance checks.
 
The Decision concludes that the settlement agreement is reasonable in light of the record, consistent with the law, and in the public interest.  The Decision further finds that Logical meets the financial, technical, and environmental qualifications necessary to be granted a CPCN. 
 
A copy of the Proposed Decision underlying this item is available at the following link:
 
Campus Communications Withdraws Request for CPCN (Item 19, approved on consent) – This Decision grants Campus Communications Group, Inc.’s (“Campus”) motion to withdraw its application to obtain a certificate of public convenience and necessity (“CPCN”) to provide full facilities-based competitive local exchange service in the service territories of Pacific Bell Telephone Company, Verizon California, Inc., SureWest Telephone, and Citizens Telecommunications Company of California, Inc.
 
Campus submitted its application in June 2014 and subsequently filed a motion to withdraw in December 2014.  Campus explained in its motion that upon further review, its current business plan did not contemplate providing local exchange service in California.  The Decision concludes that Campus’s motion should be granted because Campus provided a legitimate reason for seeking to withdraw its application, and no protest was received. 
 
A copy of the Proposed Decision underlying this item is available at the following link:
 
Customer Complaint Against SprintResolved in Customer’s Favor (Item 21, approved on consent) – This Decision resolves a customer complaint against Sprint Telephone PCS, LP (“Sprint”).  The complainant alleged that Sprint billed him for three lines of service that he did not request and for three iPads that he did not order.  The customer also complained that his last name on his account is misspelled despite repeated attempts to correct the mistake. 
 
Sprint contended that the complaint should be dismissed because Sprint had already credited the customer’s account for the fraudulent activity concerning the iPads and because the customer failed to follow procedures to change the spelling of his name as directed by its representatives.  Sprint also stated that any other charges incurred on the customer’s cell phone account were unassociated with the iPad fraud and were valid.  Sprint attempted to negotiate a settlement agreement with the customer, in which Sprint offered to waive the outstanding balance on the account.  The settlement offer was rejected by the customer because: (1) the settlement did not suggest any admission of liability, wrongdoing, or responsibility on the part of Sprint; and (2) Sprint refused to update the settlement agreement to include a statement stating that the customer was not responsible for the account because of fraudulent activity that occurred on the account.
 
An evidentiary hearing was subsequently held, and a Sprint representative was not present at the hearing to contest the complainant’s assertions.  Sprint later explained that it did not receive notice of the hearing, although Sprint did not contest that notice of the hearing was properly given.  Accordingly, the Decision explains that Sprint forfeited its ability to present its findings and positions by failing to attend the hearing and orders Sprint to credit the customer’s account and to provide the customer with free credit monitoring for one year.
 
A copy of the Proposed Decision underlying this item is available at the following link:
 
Statutory Deadline Extended To Permit Recovery Efforts In OSP Cramming Investigation Communications (Item 28, approved on consent) – This Decision extends the statutory deadline in the Commission’s investigation into whether OSP Communications, LLC (“OSP”) and its owner violated Commission rules and regulations by engaging in “cramming” practices.  The investigation was resolved through an all-party settlement agreement in September 2013; however, in the decision approving the settlement agreement, the docket was left open to allow the Commission’s Safety and Enforcement Division (“SED”) time to pursue recovery of sums held by third parties for the benefit of consumers that were harmed.  Although the statutory deadline was previously extended from January 31, 2014 to January 31, 2015, the Decision explains that SED requires additional time to pursue its recovery efforts.  Accordingly, this Decision concludes that it is appropriate to extend the deadline to July 31, 2015.
 
A copy of the Proposed Decision underlying this item is available at the following link:
 
$102,689.70 Intervenor Compensation Awarded to CforAT In Connection with Basic Service Definition Proceeding (Item 35, approved on consent) – This Decision grants the Center for Accessible Technology $102,689.70 for its contribution to D.12-12-038, which adopted revisions to the definition of basic telephone service.   CforAT’s application claimed $107,789.20 in intervenor compensation, and this Decision reduces CforAT’s claim by 4.7%.  The reduction is based on disallowances for time spent organizing communities to attend public participation hearings, which was not compensable and did not provide a “substantial contribution” to D.12-12-038.  The Decision explains that the requested hourly rates for CforAT’s representatives are comparable to market rates paid to experts and advocates having comparable training and experience and offering similar services, and that the claimed costs and expenses, as adjusted, are reasonable and commensurate with the work performed.  The intervenor award will be paid by the Commission’s Fiscal Office out of the Commission’s Intervenor Compensation Fund.
 
A copy of the Proposed Decision underlying this item is available at the following link:
 
$22,028.45 in Intervenor Compensation Awarded to TURN in Cox ETC Proceeding (Item 36, approved on consent) – This Decision awards $22,028.45 to The Utility Reform Network (“TURN”) for its contribution to D.13-10-002, the decision adopting a settlement agreement between Cox California Telecom, LLC (“Cox”), TURN, and the Greenlining Institute (“Greenlining”) in which Cox was granted ETC status to offer Lifeline telephone service in its service area.  The Decision explains that the requested hourly rates for TURN’s representatives are comparable to market rates paid to experts and advocates having comparable training and experience and offering similar services, and that the claimed costs and expenses are reasonable and commensurate with the work performed.  The Decision orders Cox to pay the award within 30 days of the effective date of this Decision.

A copy of the Proposed Decision underlying this item is available at the following link:
   
MANAGEMENT REPORTS
 
Director Dulin briefly recognized the Communications Division staff for their contribution to the State Broadband Initiative, which was undertaken in 2009 as part of the Federal program where the Commission was awarded $7.4 million to create and integrate broadband and information technology in California.  California had applied for and was awarded funding to apply the recommendations of the broadband taskforce to collect, display, and update service information from refurbished centers with CSU Chico to develop a broadband adoption strategy targeting Native American Tribes and Rancherias, to expand open network testing and crowdsourcing strategies, and to supply technical assistance to the CASF grant programs. 
 
 
SAFETY ACTION PLAN
 
Elizaveta Malashenko of the Safety and Enforcement Division and Marzia Zafar of the Policy and Planning Division gave an extensive presentation on the Commission’s Safety Action Plan and Regulatory Strategy (“Safety Plan”).  The Safety Plan is a follow-up to the Safety Policy Statement adopted by the full Commission in July 2014 and the result of a collaborative effort throughout the Commission.  Ms. Zafar explained that the Safety Plan identifies 4 underlying safety management “pillars” to meet the goal of integrating safety in all aspects of the Commission’s work.  From these pillars, the Safety Plan identifies 12 proposed deliverables to be achieved in 2015, subject to revisions or comments stemming from this presentation.
 
Pillar 1: Safety Compliance and Enforcement
           
Deliverable #1:            Enforcement Performance Internal Reporting
           
By the end of February 2015, the SED director will provide reports on safety activities, including the number of investigation and incident reports conducted by the Commission.  SED will then work with the Executive Director to refine those reports in order to establish better metrics and methodologies to track enforcement activities that will allow SED to make this information public. 
           
Deliverable #3:            Enforcement IT Needs Assessment
 
This initiative will involve a comprehensive assessment of existing enforcement programs and the databases to track safety incidents and audits.  Through this process, there will be an across-the-board review of the existing tools, identification of ongoing projects, and an effort to identify any gaps.  The goal of this deliverable will be to establish recommendations to present to the Commission in order to develop a case tracking system. 
 
It is anticipated that the needs assessment will be presented to the Executive Director by March 2015.
 
Deliverable #6:            Enforcement Document Standards Review
 
In order to ensure a more complete documentation of processes, the SED Director will review all existing documented processes to identify areas in need of improvement.  The SED Director will prepare an inventory of these processes and will present the findings to the Executive Director by June 2015. 
 
Deliverable #8:            Enforcement Policy
 
By July 2015, SED and the ALJ Division will develop and present an enforcement proposal that establishes a unified vision for the Commission’s enforcement policies and provides clear guidelines for staff regarding expectations. 
 
Deliverable #12:          Safety Website Update and Completion
 
By the end of the year, there will be an effort to significantly enhance the amount of safety information available on the Commission’s website.  It is anticipated that the Commission will completely redesign its website and safety pages to include clear explanations of all the safety programs at the Commission, along with summaries of Commission processes for handling complaints, investigating incidents, and the results of completed audits. 
 
Pillar 2:  Safety Policy
 
Deliverable #5:            Advocacy/Advisory Implementation Plan
 
By May 2015, SED will create an implementation proposal to formalize and streamline advocacy and advisory roles in the Commission.  It was explained that currently, whether, when, and how an advocacy position is taken in a formal proceeding is evaluated on a case by case basis.  Rather than this ad hoc process, the Commission should seek to establish a formal structure to ensure that timely expert safety advice and/or advocacy is provided to the judges and the Commission.
 
Deliverable #9:            Rules of Practice and Procedure Stakeholder Process
 
By July 2015, the ALJ Division will issue an Order Instituting Rulemaking to address the Rules of Practice and Procedure to incorporate ongoing safety issues. 
 
Pillar 3:  Risk Management
 
Deliverable #4:            Emergency Response Process
 
This deliverable addresses the CPUC’s role in emergency situations like earthquakes, major storms, major rail derailments, or pipeline ruptures.  Specifically, the goal of this deliverable is to develop a documented emergency response plan for the Commission that complies with national standards.  It is anticipated that a first draft will be presented in April 2015. 
 
Deliverable #7:            Staff “Safety Flag” System
 
The Energy Division will lead the development of a formal mechanism or process for any Commission staff members to raise safety concerns.  It is anticipated that a formal process will be established or launched by June 2015. 
 
Deliverable #10:          Cyber Security Team
 
By August 2015, the Policy and Planning Division will assemble a cross-functional team to address cyber-security issues.  The Policy and Planning Division will identify staff across the Commission with interest and expertise on this topic, outline a strategy for Commission action, and assess whether a rulemaking is necessary to establish a regulatory policy. 
 
Pillar 4:  Safety Promotion
 
Deliverable #2:            Safety Public Utilities Code and General Orders
 
By March 2015, there will be a safety training seminar for all staff regarding existing safety rules.  The seminar will highlight the various rules, bring important rules to the forefront, and engage Commission staff in how these rules can and should be the bases of Commission analyses. 
 
Deliverable #11:          Safety En Banc
 
The Policy and Planning Division is directed to hold a public safety en banc where utility CEOs will account for their company’s safety performance.  In a separate session, parties will evaluate safety best practices for the regulator and the regulated.  In order to keep safety on everyone’s radar, it is proposed that there will be an annual safety en banc for companies to report on their safety performance for the year through an interactive public forum that includes a discussion of each company’s emerging safety-related priorities, the status of a company’s ongoing safety mitigation efforts, and stakeholder perspective regarding the utility’s performance.
 
In addition to utility participation, the Executive Director will also report on the status of each recommendation in the Safety Plan and make future recommendations for action items to fulfill the Commission’s ongoing safety efforts. 
 
A copy of the Safety Action Plan is available at the following link:
 
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If you have any questions about the above items or the underlying proceedings in which they arose, please do not hesitate to contact us. 
 

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