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On June 11, 2015, the Commission held its regularly-scheduled agenda meeting.  No telecommunications items were addressed on the regular agenda, but on consent, the Commission authorized staff to submit comments to the FCC on the rules related to the Network Outages Reporting System.  In addition, the Commission also held the Proposed Decision that would eliminate CTF discounts for voice services, and issued another hold on the Proposed Decision that would defer the study of AT&T’s and Verizon’s network.  These and other items of interest are discussed in further detail below.

CONSENT AGENDA

Staff Comments on the FCC’s Network Outage Reporting System (Item 57, approved on consent) – This item authorizes the staff to submit comments to the Federal Communications Commission (“FCC”) regarding specific proposals to improve the FCC’s Part 4 rules, which govern the FCC’s collection and use of outage data.  the FCC’s Part 4 rules require certain communications providers to electronically file reports of network outages that exceed specified thresholds of magnitude and duration, these reports are filed in the FCC’s Network Outage Reporting System (“NORS”).

Staff will submit comments that: (1) support the FCC’s proposal to grant states direct password-protected read-only access to NORS for those communications providers operating in California, subject only to a state certifying that it has appropriate confidentiality protections in place; and (2) recommend that the FCC should not impose rules that would prohibit states from adopting their own rules as the state deems necessary, which may include lower reporting thresholds than NORS, as well as other state-specific requirements.

A copy of the Staff’s memorandum underlying this item is available at the following link.

Dial World Communications Granted a CPCN (Item 8, approved on consent) – This Decision approves a settlement agreement that grants Dial World Communications, LLC’s (“Dial World”) request for a certificate of public convenience and necessity (“CPCN”) for authority to provide resold interexchange service in California.

Dial World is a prepaid debit card provider offering telecommunications services and intends to provide service via prepaid debit/calling cards to consumers in California.  On May 31, 2013, the Communications Division was advised that Dial World had been offering telecommunications services as a prepaid debit card provider to California consumers without proper authority.  The Communications Division therefore directed Dial World to apply for a CPCN.  Dial World subsequently submitted this application, which acknowledges that it has been providing prepaid calling services in California without authorization.  Dial World’s application was protested by the Commission’s Safety and Enforcement Division for operating as an unlicensed carrier and raised questions about Dial World’s fitness to operate in California and to comply with the Commission’s rules.

Pursuant to the terms of the Settlement Agreement, Dial World acknowledges that it previously failed to obtain the required authority to operate in California and that it had begun providing the services of prepaid calling cards in California prior to obtaining authority.  Dial World also agrees to pay a penalty of $65,000 for its violations.  The Decision also concludes that the Settlement Agreement is in the public interest, reasonable in light of the record, and consistent with law.  Further, the Decision concludes that Dial World meets the necessary financial, technical, and environmental qualifications necessary to hold a CPCN.

A copy of the final decision underlying this item is available at the following link.
 
Customer Complaint Against AT&T Dismissed (Item 13, approved on consent) – This Decision dismisses a customer complaint filed against AT&T on the basis that the issues have been resolved.  This complaint was filed by a customer alleging unreliable telephone service from AT&T.  During a hearing, the customer described service outages and AT&T’s representatives agreed to have service technicians inspect and repair any faulty AT&T equipment.  AT&T and the customer subsequently worked cooperatively to resolve the existing telephone service issues through a series of inspections, repairs, and service adjustments.  AT&T has recently notified the Commission that the telephone and internet service issues have been resolved.  Accordingly, the Decision determines that it is appropriate to dismiss this complaint.

A copy of the final decision underlying this item is available at the following link.

TURN Awarded $194,683.20 in Intervenor Compensation for Contributions to Decisions Addressing Basic Telephone Service and LifeLine (Item 38, approved on consent) – This Decision awards The Utility Reform Network (“TURN”) $194,683.20 in intervenor compensation for its contribution in the CHCF-B and LifeLine proceedings, and specifically to the decision adopting revisions to modernize and expand the LifeLine program (D.14-01-036).  The CHCF-B proceeding addressed the issue of “affordability of basic telephone service,” which was deferred to the LifeLine proceeding and was resolved through D.14-01-036.  The Decision reduces TURN’s claim by 8.02% for work that is clerical in nature, duplicative, and travel costs associated with TURN’s attorney’s travel from her home in San Diego to the Bay 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 directs the Commission’s Fiscal Office to disburse the awarded compensation within 30 days.

A copy of the final decision underlying this item is available at the following link.

CforAT Awarded $78,923.73 in Intervenor Compensation for Contributions to Decisions Addressing Basic Telephone Service and LifeLine  (Item 39, approved on consent) – This Decision awards the California for Accessible Technology (“CforAT”)’s $78,923.73 in intervenor compensation for its contribution in the CHCF-B and LifeLine proceedings, and specifically to the decision adopting revisions to modernize and expand the LifeLine program (D.14-01-036).  The CHCF-B proceeding addressed the issue of “affordability of basic telephone service,” which was deferred to the LifeLine proceeding, and was resolved through D.14-01-036.

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 are reasonable and commensurate with the work performed.  The Decision directs the Commission’s Fiscal Office to disburse the awarded compensation within 30 days.

A copy of the final decision underlying this item is available at the following link.

Statutory Deadline Extended in Vaya and AT&T Complaint (Item 53, approved) – This Decision extends the statutory deadline for resolving the two consolidated complaints filed between VAYA Telecom, Inc. (“Vaya”) and Pacific Bell Telephone Company d/b/a AT&T California (“AT&T”) from June 18, 2015 to December 18, 2015.  The first complaint was filed by Vaya, which asserted that AT&T improperly assessed switched access charges on terminating and transiting VoIP traffic that Vaya delivered to AT&T.  A second complaint was filed by AT&T against Vaya asserting that Vaya breached the parties’ interconnection agreement by delivering interLATA traffic over local interconnection trunks.

In D.14-01-006 the Commission resolved the legal issues raised by both complaints.  However, D.14-01-006 did not resolve the amounts due.  Instead, the Decision ordered Vaya and AT&T to meet and confer and to file a joint statement that shows the amount of traffic transmitted by Vaya to AT&T, the classification of the traffic, amounts paid to AT&T for transmission of that traffic, and additional amounts due to AT&T for termination.
Since D.14-01-006 was issued, Vaya has filed an Application for Rehearing and AT&T has moved to have the Commission enforce D.14-01-006.  The Commission denied Vaya’s Application for Rehearing on February 12, 2015 in D.15-02-022.  Currently, evidentiary hearings are scheduled for June 29, 2015 – July 1, 2015 and the Decision explains that an extension of the statutory deadline is necessary to resolve the amounts due pursuant to the D.14-01-006.

A copy of the final decision underlying this item is available at the following link.

Statutory Deadline Extended in Customer Complaint Case Against AT&T (Item 54, approved on consent) – This Decision extends the statutory deadline for resolving a customer complaint against Pacific Bell Telephone Company dba AT&T California (“AT&T”) regarding billing charges and a request for a refund and transfer of service.  The statutory deadline is extended to January 12, 2016.  The initial complaint was filed on July 12, 2013.  Although AT&T has denied the charges and requested that the complaint be dismissed, AT&T credited the disputed charges on July 23, 2013.  However, on May 15, 2014 the customer filed a second complaint alleging that his telephone service had not been transferred to his new address.  On August 12, 2014, a prehearing conference was held and evidentiary hearings were set on December 11 and 12, 2014.  These hearings were subsequently rescheduled and held on February 11, 2015 and parties submitted post-hearing briefing on March 31, 2015.  A Presiding Officer’s Decision is being drafted and is expected to be mailed in the second quarter of 2015.  Accordingly, the Decision finds that additional time is warranted to allow the Presiding Officer’s Decision to be drafted and to be addressed by the Commission.

A copy of the final decision underlying this item is available at the following link.

Statutory Deadline Extended in UCAN’s Complaint Against TelePacific (Item 55, approved on consent) – This Decision extends the statutory deadline to resolve the Utility Consumers’ Action Network’s (“UCAN”) complaint against U.S. TelePacific Corp. dba TelePacific (“TelePacific”) alleging a series of Public Utilities Code violations regarding unauthorized charges to customers’ bills, unjust and unreasonable rates, and allegations regarding inaccurate information to customers and to Commission Staff.  UCAN’s complaint was filed on July 17, 2014 and UCAN argued that the services that are the subject of the complaint fall within the definition of VoIP as defined by Section 239 of the Public Utilities Code and are outside of the Commission’s jurisdiction pursuant to Section 710.  A prehearing conference was held on September 26, 2014 and on October 10, 2014 TelePacific filed a motion to dismiss the complaint because the Commission lacks jurisdiction over the disputed subject.  UCAN has requested that the Commission deny the motion to dismiss.

This Decision determines that it is necessary to extend the statutory deadline to January 17, 2016 in order to address the issues raised in the complaint and the jurisdiction under Section 710.

A copy of the final decision underlying this item is available at the following link.

HELD ITEMS
 
Proposed Decision on Modifications to the CTF Program  (Item 7, held until June 25, 2015) – This Proposed Decision would resolve Phases 1 and 2 issues regarding the California Teleconnect Fund (“CTF”) and would adopt restated program goals and modifications to the CTF program.  The restated goals would effectively modify the program into a direct Internet access program.  Specifically the proposed restated goals would be as follows: (1) advance universal service by providing discounted rates to qualifying schools, maintaining pre-school, kindergarten or any of the grades 1 to 12, inclusive, community colleges, libraries, hospitals, health clinics and community organizations; (2) bring every Californian direct access to advanced communications services in their local communities; (3) ensure high-speed internet connectivity for community CTF-eligible institutions at reasonable rates; and (4) increase direct access to high-speed internet in communities with lower rates of internet adoption and greater financial need.

The Proposed Decision would also modify the CTF program by eliminating CTF discounts for voice services, a proposal that was heavily opposed by many parties in the proceeding.  The Proposed Decision would also establish a group of categorically eligible participants for certain schools, community colleges, libraries, hospitals and health clinics.  In addition, the Proposed Decision would revise the eligibility criteria for community base organizations, including: (1) limiting CBO eligibility to those entities with revenues less than $5 million (from $50 million); (2) requiring a qualifying CBO to provide a qualifying service in a manner that constitutes 50% or more of a CBO’s mission; (3) requiring CBOs to provide services directly to individuals at specific geographic locations; (4) requiring a majority of members of the Board of Director to be members of the community the organization serves; and (5) eliminate discounts for purely administrative purposes.  For additional details regarding the proposed rules, please Appendix A of the Proposed Decision.

A copy of the Proposed Decision underlying this item is available link.

Proposed Decision Regarding Deferral of Infrastructure Network Study of AT&T and Verizon   (Item 6, held until July 27, 2015)– This Proposed Decision would defer the examination of the networks of AT&T California and Verizon California Inc. ordered in Decision (D.) 13-03-023 until the Commission rules on the proposed service quality rule changes and penalties under consideration in the Service Quality Proceeding, Rulemaking (R.) 11-12-001.  The Proposed Decision explains that penalty mechanisms being contemplated in the Service Quality, if adopted, would provide significant incentives for telephone corporations to improve service quality to a level that meets the Commission’s General Order 133-C minimum service quality measure standards.  For these reasons, the Proposed Decision would determine that the network study may not be necessary.

A copy of the Proposed Decision underlying this item is available at the following link.

TracFone’s Request for ETC Designation (Item 3, held until July 27, 2015) – This Resolution would conditionally grant the request of TracFone Wireless, Inc. dba SafeLink Wireless (“TracFone”) to be designated as a Eligible Telecommunications Carrier and a California LifeLine Provider throughout California, excluding Tribal Lands.  TracFone’s most recent request was filed on February 3, 2014 and amended on April 1, 2014 to specifically include the Small LEC territories.  Although we initially were prepared to protest TracFone’s amended advice letter, further research confirmed that the Commission was authorized to grant wireless, LifeLine-only ETC requests for authority in the Small LEC service areas based on FCC directives.

TracFone first sought ETC designation in 2008, but its initial request was denied on the grounds that it would not be in the public interest since TracFone refused to collect and remit public purpose surcharges.  The Commission’s investigation into TracFone’s practices was subsequently resolved in January 2014, when the Commission approved a decision fining TracFone $24 million.  Although TracFone filed an application for rehearing of the decision, it has since remitted payment for the fine and is currently in good standing as to all payments for user fees and public purpose program surcharges.

The Draft Resolution would approve three wireless service plans that provide a free or discounted handset and no cost activation fee: (1) a no charge unlimited minutes and texts plan; (2) a $27.60 plan with unlimited minutes and texts, and 2.5 GB data at 4G speed; and (3) a $17.60 plan with unlimited minutes and texts, and 1 GB data at 4G speeds.
The Draft Resolution would further direct TracFone 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) 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.

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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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