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On March 21, 2013, the Commission held its regularly-scheduled meeting offsite in San Diego.  The Commission rejected the $2.6 million RTIGP grant for the Channel Islands Project and initiated a proceeding to implement the expansion of the DDTP program to offer speech generating devices.  The Commission also authorized comments to be submitted on the FCC proceedings on rural call completion and the Connect America Fund.  In addition, the Commission continued its hold on the Proposed Decision modifying requirements for CPCN and WIR holders or applicants.  These and other items of interest on the Commission’s agenda are discussed in further detail below.

REGULAR AGENDA ITEMS

Channel Islands Rural Telephone Grant Project Defeated (Item 46, defeated 5-0) – This Resolution would have authorized a Rural Telecommunications Infrastructure Grant Program (pursuant to AB 140) (“RTIGP”) grant in the amount of $2,693,000 to the Channel Islands Telephone Company (“CITC”) for the construction of the Channel Islands Telephone Company Grant Project (“Channel Islands Project”).  CITC currently has a limited-facility-based certificate of public convenience and necessity (“CPCN”); however, a full-facilities-based CPCN would have been required for this grant to become effective.  An application to expand CITC’s authority was pending before the Commission and discussed below as Item 47 (A.10-02-009).  The Channel Islands Project proposed to provide telephone service to four of the eight Channel Islands, specifically San Miguel, Santa Barbara, Santa Cruz, and Santa Rosa.  
 
A copy of the Draft Resolution underlying this item is available at the following link:

CONSENT AGENDA ITEMS
 
New Rulemaking Initiated to Add Speech Generating Devices to the DDTP (Item 32, adopted on consent) – This item initiates an Order Instituting Rulemaking (“OIR”) to expand the Disabled Telecommunications Program (“DDTP”) to offer Speech Generating Devices (“SGD”) to disabled California residents.  The DDTP offers assistive telecommunications services and equipment to California residents who are certified as having a hearing, speech, mobility, vision, or cognitive disability.  The DDTP is funded through a surcharge on end-user telephone bills in California.  The current surcharge rate is 0.20%.   
 
On October 2, 2011, the Governor signed into law Assembly Bill (“AB”) 136, which added Speech Language Pathologists (“SLP”) to the list of agents that can certify individuals as being eligible to receive equipment from the DDPT.  AB 136 also added SGDs to the list of equipment to be offered by the DDTP. 
 
This OIR will address the implementation of AB 136 by establishing rules and parameters for distributing SGDs.  Issues to be considered in the scope of this proceeding will include:  (1) an evaluation the certification process for qualifying SLPs; (2) defining a Qualified State or Federal Agency for the purpose of the DDTP; (3) determining whether SGD equipment is a telecommunications device or whether it also includes a telecommunications component; (3) establishing a process for distributing SGD where the Commission is a partial or sole funder; (4) identifying the criteria for obtaining an SGD; and (5) evaluating available funding sources.
 
The OIR will also establish a working group to make recommendations to the Commission for developing SDG distribution program rules.  The working group will be managed by Jonathan Lakritz in the Communications Division.
 
A copy of the Draft Order Instituting Rulemaking underlying this item is available at the following link
 
Comments to the FCC Regarding Rural Call Completion (Item 50, authorized on consent) –
This item authorizes the CPUC to file comments in response to the FCC’s Notice of Proposed Rulemaking in the Matter of Rural Call Completion.  This FCC proceeding seeks data and comments on proposed rules to help address problems in the completion of long-distance telephone calls to rural customers.  Specifically, the Commission notes that call completion problems may arise from the manner in which the originating providers set up the signaling and routing of their calls, and that many of these call routing and termination problems can be attributed to intermediate providers.  The comments will express the Commission’s support of the FCC’s proposal to collect better data on call completion problems and urge the FCC to take enforcement actions.  The Commission would also request that the FCC permit state commissions to access any data filed by carriers in their state. 
 
A copy of the Memorandum underlying this item is available at the following link:

A copy of the FCC’s Notice of Proposed Rulemaking is also available at the following link
 
Comments to the FCC Regarding Service Obligations for Connect America Phase II (Item 49, authorized on consent)  – This item authorizes the CPUC to file comments in response to the FCC’s request for comments on the methodology used to determine which providers can be considered unsubsidized competitors for purposes of the Connect America Fund.  The CPUC’s comments will:  (1) recommend a speed benchmark of 6 Mbps for download and 1.5 Mbps for upload to determine which areas can be considered serve, noting that it is consistent with the speed threshold used for the CASF program; (2) agree with the FCC’s proposal to consider any area with a cable provider using DOCSIS 3.0 as served; and (3) recommend that mobile broadband providers be considered unsubsidized competition if they can prove that their services should be capable of supporting voice and streaming video.  Comments were due on March 28, 2013. 
 
A copy of the Memorandum underlying this item is available at the following link
 
A copy of the FCC’s Public Notice is available at the following link
 
Resolution Setting DIVCA’s Annual Fee for Video Franchise Holders for FY 2012-2013 (Item 6, adopted on consent) – This Resolution sets the annual fee for video franchise holders in FY 2012-2013 at $0.0373822 cents per household.  This is 12% decrease from the FY 2011-2012 annual fee at $0.0423 because of an increase in households in video franchise holders’ territories.  Since household numbers have increased by 13% from 22,441,618 to 25,413,155 and the annual fee is based on a pro-rata allocation of households in the franchisee holders’ video service territories, a reduction in fees will still generate $950,000 as authorized by the Commission’s FY 2011-2012 DIVCA-related budget. 
 
Video franchise holders with franchises issued on or before the date this Resolution is issued will pay their annual fees for FY 2012-2013 before April 30, 2013.  Holders of franchises granted after the date of the Resolution will pay the fee amount within 60 days after the issuance of their franchise or by June 30, 2013, whichever is earlier. 
 
A copy of the Draft Resolution underlying this item is available at the following link
 
Fiscal Agent Approved for Eastern Sierra Connect Regional Broadband Consortium (Item 9, adopted on consent) –  This Resolution approves Desert Mountain Resource Conservation and Development Council (“Desert Mountain”) as the new fiscal agent for the Eastern Sierra Connect Regional Broadband Consortium (“ESCRBC”).  The Commission previously approved a CASF regional broadband consortia grant to ESCRBC and appointed Humboldt State University Sponsored Programs Foundation (“HSU”) as the fiscal agent.  Last November, Desert Mountain, the original applicant for the ESCRBC, requested approval as the fiscal agent and HSU agreed to release ESCRBC from the remainder of its fiscal agreement.  The Resolution finds that approval is appropriate so that CASF consortium activities will continue to promote broadband service in the Eastern Sierra.  Desert Mountain will be responsible for preparing and administering payment requests, filing quarterly activity reports, and maintaining and producing expense documentation for the CASF program. 
 
A copy of the Draft Resolution underlying this item is available at the following link
 
Customer Complaint Against Cbeyond Communications Dismissed (Item 16, adopted on consent) – This Decision dismisses a customer complaint filed against Cbeyond Communications for lack of prosecution.  The Complainant claimed that Cbeyond breached its contract to provide working service of at least 90% of the time.  Complainant claimed that it had experienced consistent problems with phone and internet outages, including dropped calls, faulty connections and slow internet.  The Decision dismisses the complaint because the Complainant failed to appear at a duly noticed hearing in this proceeding. 
 
A copy of the Proposed Decision underlying this item is available at the following link
 
Customer Complaint Against T-Mobile Dismissed (Item 17, adopted on consent) –  This Decision dismisses a customer complaint against T-Mobile West, LLC (“T-Mobile”).  Complainant alleged that T-Mobile erroneously placed her into a new contract when she exchanged a defective telephone handset.  T-Mobile disagreed with the facts underlying Complainant’s allegation, but nevertheless credited the full amount of the outstanding balance to the Complainant’s account as a courtesy.  Neither party appeared for a scheduled hearing and the Decision finds that the complaint is moot as a result of the credit to the Complainant’s account.
 
A copy of the Proposed Decision underlying this item is available at the following link
 
Statutory Deadline Extended for NewPath Networks (Item 30, adopted on consent) –
This Decision extends the statutory deadline for resolving a complaint filed by the City of Davis (“Davis”) against New Path Networks, LLC (“NewPath”).  Davis alleged that NewPath’s proposed construction of a distribution antenna system violated provisions of CEQA and NewPath’s CPCN.  Specifically, Davis claimed that NewPath claimed categorical exemptions under CEQA that did not apply.  NewPath denied the allegations and alleged that Davis’s actions violated state and federal law.  The statutory deadline for this proceeding has been extended twice due to ongoing efforts settlement discussions between the parties.
 
A proposed settlement agreement was approved by the Davis City Council, but it contemplated additional permits and licensing agreements that would be subject to further approvals by the City Council.  After successfully negotiating the license and right-of-way use agreement, the parties prepared a formal settlement agreement to memorialize the terms of the resolution.  This formal settlement agreement has been submitted to the Davis City Council for approval.  The Decision determines that another 12-month extension is appropriate because formal proceedings would be necessary in the event that the parties do not ultimately reach a settlement or if the Davis City Council does not approve the settlement. 
 
A copy of the Proposed Decision underlying this item is available at the following link
 
Intervenor Compensation to TURN for Substantial Contribution to CASF Proceedings (Item 36, adopted on consent) – This Decision grants $27,172.50 in compensation to The Utility Reform Network (“TURN”) for substantial contribution to D.11-06-038 and D.12-02-015.  These Decisions implemented provisions of SB 1040.  D.11-06-038 related to the Rural Urban Regional Broadband Consortia Account and D.12-02-015 related to the Broadband Infrastructure Grant Account and Revolving Loan Account.  The Decision finds that TURN made substantial contributions in the proceedings leading up to the D.11-06-038 and D.12-02-015, and that the claimed fees and costs are comparable to market rates paid to experts and advocates having comparable training and experience and offering similar services.  
 
A copy of the Proposed Decision underlying this item is available at the following link

 
LEGISLATIVE ITEMS
 
Proposed Legislation on Public Utilities Act, AB 415 (Garcia) (Item 54, oppose position approved on consent) –  This bill would establish as a matter of law that “a reasonable good faith reliance” upon statements of the California Public Utilities Commission staff is a defense to an enforcement action brought by the CPUC.  This would not apply to enforcement actions directly related to actions alleging a violation that led or could have led to the harm of humans.  This bill is sponsored by TracFone.  TracFone is the subject of an ongoing enforcement proceeding for failing to pay user fees and public purpose surcharges.  TracFone claimed that it relied on statements of the Communications Division in believing it was not required to pay the fees.
 
The CPUC opposes this bill and claims that it would discourage informal communications between CPUC staff and utilities and the public.  The CPUC also claims that the bill would also have an adverse impact on public safety by impeding informal communications between the CPUC staff and utilities. 
 
A copy of the Legislative Memo underlying this item is available at the following link:   
 
Proposed Legislation on California Teleconnect Fund, AB 876 (Bonata) (Item 58, support if amended position approved on consent) – This bill would: (1) open a proceeding or amend an existing proceeding to assess whether rates charged to schools in the California Teleconnect Fund (“CTF”) program are comparable to rates charged to for-profit entities; (2) establish and maintain a database on the CPUC’s public internet website of services purchased by entities receiving the CTF discounts so that qualifying entities can collaborate and allow for the use of common infrastructure; and (3) prioritize the use of CTF monies for advanced high-quality communications services. 
 
The CPUC notes that the bill’s rate comparison and prioritization proposals are consistent with the issues in the CTF Proceeding (R.13-01-010).  However, the CPUC also notes that the proposed database would require significant additional resources and the consideration of additional legal safeguards to ensure that customer privacy information would not be disclosed.
 
The CPUC recommends that the bill be amended to clarify that it is intended to make public information regarding the communication services purchased by qualifying schools available to the public.  Moreover, the bill should specify that it is not intended to require the public disclosure or posting of information concerning residential or telephone customers that is subject to existing statutes restricting public disclosure. 
 
A copy of the Legislative Memo underlying this item is available at the following link:   
 
Proposed Legislation on Teleconnect Fund, AB 1100 (Levine) (Item 59, oppose unless amended position adopted on consent) –  This bill would eliminate the annual cap on the California Teleconnect Fund (“CTF”) discounts to California Community Colleges.  The law currently caps CTF discounts to $10.865 million, augmented from $7.2 million in August 2011 by $2.3 million.  The author indicates that it is unfair for a single group of eligible entities to be singled out for caps on discounts. 
 
The CPUC opposes the bill on the basis that: (1) the cap has not prohibited CCCs from participating in the CTF program; (2) the CPUC has the discretion to increase the annual funding if the cap is inadequate; and (3) eliminating the cap would reduce the Commission’s flexibility in addressing CTF program issues.  The CPUC also notes that the bill would result in an increased CTF surcharge for ratepayers.  If the bill remains active, the CPUC recommends that the bill be amended to provide the CPUC with flexibility to address CTF program budget issues by authorizing the Commission to reduce CTF discounts to CCCs.
 
A copy of the Legislative Memo underlying this item is available at the following link:   
 
Proposed Legislation on California Advanced Services Fund, SB 740 (Padilla) (Item 62, support position approved consent ) –  This bill would amend Public Utilities Code Section 281 to make any entity that is not a telephone corporation eligible to apply for CASF grants if that entity otherwise satisfies the CASF’s eligibility requirements and any other CPUC requirements.  This bill would also authorize the collection of an additional $100 million dollars for CASF infrastructure grants by the end of 2020.
 
A copy of the Legislative Memo underlying this item is available at the following link:   
 
Proposed Legislation Prepaid Mobile Telephony Services, AB 300 (Perea) (Item 52, held by staff until 4/4/13) –  This bill would establish a mobile telephony service surcharge to be paid by customers purchasing prepaid mobile telephone service.  The surcharge would consist of a state and local component, including a prepaid MTS surcharge, an emergency telephone users surcharge, and other PUC surcharges.  The Commission’s Office of Governmental Affairs recommends that the CPUC oppose this bill.  
 
A copy of the Legislative Memo underlying this item is currently unavailable, but a copy of the bill is available at the following link
 
Proposed Legislation on CPUC Procedures, SB 611 (Hill) (Item 61, held by staff until 4/4/13) – This bill would remove the CPUC President’s ability to direct the executive director, attorney, or other staff of the CPUC.  The bill would also require the CPUC to adopt procedures on the disqualification of commissioners due to bias or prejudice.  Moreover, an officer, employee, or agent of the CPUC assigned to assist in the prosecution of, or to testify in, an adjudication case would be prohibited from participating in the decision of the case or any factually related proceeding.  The Commission’s Office of Governmental Affairs recommends that that CPUC oppose this bill. 
 
A copy of the Legislative Memo underlying this item is currently unavailable, however a copy of the bill is available at the following link
 
HELD AGENDA ITEMS

Revisions to the Certification Processes for Telephone Corporations Seeking or Holding CPCNs and WIRs (Item 45, held by Staff until 4/4/13) – This Proposed Decision would adopt revisions to the certification process for telephone corporations seeking or holding Certificates of Public Convenience and Necessity (“CPCN”) and wireless carriers seeking or holding Wireless Identification Registration (“WIR”).  The changes to the certification processes are intended to increase accountability for carriers, reduce the need for enforcement actions to be brought, and improve the Commission’s ability to collect fines, penalties, and bring restitution.  The Proposed Decision would establish a Phase II of the proceeding to determine performance bond requirements, as discussed below.
 
The Proposed Decision would require all applicants seeking or holding a CPCN or WIR to post a bond to facilitate the collection of fines, fees, surcharges, taxes, penalties, and restitution.  ILECs are specifically exempted from the bond requirement.  The bond amount for applicants seeking or holding a CPCN or a WIR would be initially set at $25,000.  In Phase II of the rulemaking, the Commission will determine, starting with input in workshops, a reasonable performance bond amount based on intrastate revenue and/or consumer protection considerations.  The bond amount for new applicants granted a CPCN or WIR that have not reported annual intrastate revenues to the Commission would be $25,000. 
 
The Proposed Decision would also: (1) require CPCN applicants and wireless registrants to provide the Commission with resumes and detailed information on key officers, directors, and certain owners; (2) require applicants seeking to transfer licenses or registrations to verify compliance with Commission reporting, fee, and surcharge transmittals; (3) increase the application fee for new and transferred CPCN authority from $75 to $500, subject to legislative approval; (4) require wireless registrants to pay a $250 fee for new and transferred registration; (5) establish a minimum annual user fee of the Commission-established rate in effect at the time or $100, whichever is greater; and (5) require a new verification with specified language that certain key officers, directors, and owners were never associated with a telecommunications carrier that filed for bankruptcy, was sanctioned by the FCC or state regulatory agency, or was ever found civilly or criminally liable by a court.
 
 
A copy of the Proposed Decision underlying this item is available at the following link
 
Channel Islands Telephone Company’s Application to Expand CPCN Authority (Item 47, held until 4/4/13 ) – This Proposed Decision would grant Channel Islands Telephone Company (“CITC”) a Certificate of Public Convenience and Necessity (“CPCN”) to provide facilities-based local exchange and interexchange service to five of the Channel Islands.  The CITC was previously granted a CPCN to provide limited facilities-based local exchange and interexchange services in California.  However, a full-facilities based CPCN is required when a telecommunications provider wishes to perform non-minor construction.  The CITC project proposal would involve installation of cellular telecommunication infrastructure at 15 project locations on Anacapa Island, San Miguel Island, Santa Barbara Island, Santa Cruz Island, and Santa Rosa Island.  CITC included a Proponent’s Environmental Assessment in its application and an Initial Study and Mitigated Negative Declaration (“ISMND”) was prepared pursuant to CEQA requirements.  The ISMND concluded that the project would not have a significant adverse effect on the environment with the required mitigation and identified a number of project elements to be addressed as conditions of approval. 
 
The Proposed Decision would also open a Phase 2 to the proceeding to determine wither the CITC violated Rule 1.1 of the Commission’s Rules of Practice and Procedure for failing to inform the Commission that the California Secretary of State suspended the CITC’s authority to conduct business in California for failing to comply with Franchise Tax obligations.
 
 
A copy of the Proposed Decision underlying this item is available at the following link
 
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If you have questions regarding any of the above items, or the underlying proceedings in which they arose, please feel free to contact us.
 

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