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On December 16, 2010, the California Public Utilities Commission held the agenda meeting of the year. This meeting marked the end of the Commission tenures of Commissioners Grueneich and Bohn, and likely for Commissioner Ryan. It also brought a close to a series of significant telecommunications decisions, including the long-pending California Environmental Quality Act (CEQA) proceeding. The Commission also granted authority to Calaveras Telephone Company to borrow $1.2 Million to finance a broadband infrastructure project in its Copperopolis Exchange, and opened a new rulemaking to address the California Advanced Services Fund (CASF). The proposed rulemaking to address Voice Over Internet Protocol (VoIP) service providers’ responsibilities for payment into the public policy funds was held until January 13, 2011. These and other items of interest on the Commission’s public agenda are discussed in further detail below.


REGULAR AND CONSENT AGENDA ITEMS


  • General Order 170 Adopted Specifying Review Procedures Pursuant to California Environmental Quality Act (Item 61, adopted 3-2 on regular agenda, President Peevey and Comr. Simon dissenting) – After a pre-meeting indication from Commissioner Simon that he would hold the Proposed Decision to develop an alternate, he lifted the hold on the item from the dais. This Decision adopts a new General Order (G.O.) 170 setting forth Commission procedures for reviewing telephone corporations’ proposed construction projects pursuant to the California Environmental Quality Act (CEQA). GO 170 institutes a new process involving PUC review of a large number of construction projects that are currently subject to environmental analysis by local jurisdictions. Commissioner Bohn indicated that the essential purpose of G.O. 170 is to facilitate advanced communications infrastructure and apply same rules to all telephone and telegraph communications. While Commissioner Bohn stated his belief that the new G.O. 170 will not pose a burden on carriers, he indicated openness to any necessary amendments to address any overly burdensome requirements. Commissioner Simon expressed his reservations about the Decision, noting that it does not strike an appropriate balance between promotion of the goals of CEQA and the promotion of broadband, and that application causes unreasonable effects on competition between intermodal carriers. He also stated that he does not support an exemption-driven process, such as that embodied in the Decision. The Final Decision and new General Order 170 are available here.
  • Calaveras Telephone Company Granted Authority to Borrow $1,226,093 From Rural Utilities Service to Finance Broadband Infrastructure Project in Copperopolis Exchange (Item 44, adopted on consent agenda) – This Decision authorizes Calaveras Telephone Company (CalTel) to: (1) enter into a loan agreement with the Rural Utilities Service for the purpose of borrowing $1,226,093 under the Broadband Initiative Program authorized by the American Recovery and Reinvestment Act of 2009; (2) use the loan proceeds to finance the construction of a broadband infrastructure project in its Copperopolis exchange in Calaveras County; and (3) execute a related agreement and supplemental security instruments in conjunction with the loan. CalTel intends to use these funds to provide telephone service, internet access, and video services over a fiber to the home (FTTH) platform to customers located in its Poker Flat Service area, a high-cost and high demand area in need of additional services and updated infrastructure. The Proposed Decision associated with this item is available here.
  • Rulemaking Instituted To Consider Modifications to California Advanced Services Fund (Item 63, adopted 5-0 on regular agenda) – This OIR is intended to further implement Senate Bill 1040, which added another $125 million in spending authority for the CASF, extended the life of the program, and modified the program rules in various respects. SB 1040 established three accounts under the CASF: (1) the Broadband Infrastructure Grant Account; (2) the Rural and Urban Regional Broadband Consortia Account; and (3) the Broadband Infrastructure Revolving Loan Account. The Rulemaking will address such issues as increased overall funding for the CASF program, the new consortia grant, and a proposal to use broadband infrastructure revolving loan accounts. Opening Comments on a wide number of issues set forth in the OIR are due 30 days its mailing, and reply comments due 15 days after, and we will notify you of that date. The Proposed Decision associated with this item is available here.
  • Consumer Affairs Branch to Implement Web Posting of LEP Contacts (Item 68, adopted 5-0 on regular agenda) – Decision 08-10-016 addressed the improvement of services and promotions for telecommunications customers in California who do not speak fluent English or are limited English proficient. This Resolution, presented by Commission Staff at the Agenda Meeting, orders the Commission’s Consumer Affairs Branch (CAB) to: (1) post certain data, disclosures and information annually on the Commission’s website; (2) design and implement a mechanism that allows interested stakeholders to provide comments, complaints, or suggestions with regard to the CAB Limited English-Proficiency data and other information posted on the website; and (3) to review the feedback, data posting process, and data on a regular basis. Commissioner Simon expressed some concern regarding the frequency of reporting, and encouraged CAB to work with telecommunications providers to ensure freshness of submitted data. 
  • Extension of Statutory Deadline to Resolve Malibu Canyon Fire Investigation (Item 38, adopted on consent agenda) – This Decision extends the statutory deadline to resolve the investigation of the October 2007 Malibu Canyon Fire investigation to February 5, 2012. The Malibu Canyon fire proceeding’s purpose is to determine whether any of the named utilities in the proceeding – AT&T, SCE, Cellco Partnership LLP dba Verizon Wireless, Sprint Communications Company LP, and NextG Networks of California, Inc. – violated any statutory law or Commission order, rule or requirement with respect to facilities that may have caused the Malibu Canyon Fire. The Proposed Decision extending the timeframe for resolution of this proceeding is available here.  
  • Assorted Telephone Corporations’ Operating Authorities Revoked (Item 33, adopted on regular agenda) – This Resolution revokes operating authorities held by 57 telephone corporations for failing to comply with a California Public Utilities Reimbursement Account Fee filing and reporting requirements of Public Utilities Code Sections 401 through 435, despite the Commission’s attempts to notify them of these requirements. The CPUC assumes that the telephone corporations that did not respond have either gone out of business or are no longer providing telephone service in California. If any such companies are still in operation, they will have an opportunity to reinstate their operating authority by providing a report on gross intrastate revenues from 2009 to the present, and paying fees, surcharges and a 25% fine. The Draft Resolution associated with this item is available here.
  • Six AT&T Affiliates Exempted From Public Utilities Code Section 851 Asset Transfer Requirements (Item 43, adopted on regular agenda) – This Resolution exempts six affiliates of AT&T (competitive local exchange carriers including AT&T Corp, d/b/a AT&T Advanced Solutions’, AT&T Communications of California, TCG San Diego, TCG San Francisco, TCG Los Angeles, and SBC Long Distance, LLC) from Public Utilities Code Section 851 asset transfer requirements by public utilities. The Resolution acknowledges the May 6, 2010 Decision 10-05-019 which provided exemptions to all eligible URF carriers, except for capital leases or leasehold improvements, from support assets which do not provide unbundled network elements, wholesale services or collocation, and therefore are considered non-controversial. The Draft Resolution associated with this item is available here.
  • 5LINX Enterprises, Inc. Granted Certificate of Public Convenience and Necessity (Item 42, adopted on consent agenda) – This Decision grants a certificate of public convenience and necessity (CPCN) to 5LINX Enterprises, Inc. (5LLINX) to provide resold competitive local exchange and interexchange services in the service territories of Pacific Bell Telephone Company, d/b/a AT&T California, Verizon California Inc., SureWest Telephone, and Citizens Telecommunications Company of California, Inc., d/b/a Frontier Communications of California, and as a non-dominant interexchange carrier throughout California. The Proposed Decision associated with this item is available here.
  • Community Hospital of Long Beach’s Request for $27,854 Late Charges From Verizon California Denied (Item 17, adopted on consent agenda) – This Decision denies Community Hospital of Long Beach’s (CHLB) request for $27,854.52 in late payment charges from Verizon California, Inc. (Verizon) related to two claims for overcharges CHLB incurred between 2001-2007. As to the first claim for charges stretching back to 2001, Verizon had already refunded the alleged overcharges in a prior action, and the Commission here finds that the three-year statute of limitations for this period had expired by the time CHLB brought its claim. On the second claim for charges incurred in 2007, the Commission found that the claim was brought within the three-year statutory period and therefore awarded $1,744.64 in late payment charges. The Proposed Decision associated with this item is available here.
  • Statutory Deadline Extended in City of Santa Barbara Case Against Verizon California (Item 45, adopted on consent agenda) – This Decision extends the statutory deadline to resolve this adjudicatory proceeding brought by the City of Santa Barbara against Verizon regarding the interpretation of a tariff that governs the undergrounding of existing telephone communication facilities in circumstances where a city creates a new underground utility district. The Proposed Decision associated with this item is available here.


SIGNIFICANT HELD OR WITHDRAWN ITEMS


  • Rulemaking to Require California Providers of VoIP to Fund California’s Universal Service Programs

(Item 62, held until January 13, 2011 by President Peevey for further review) – This draft OIR would institute a Rulemaking to add California providers of interconnected Voice over Internet Protocol (VoIP) to the category of voice service providers required to fund California’s universal service programs, including the California LifeLine Telephone Program, the California High-Cost Fund A, the California High-Cost Fund B, the California Advanced Services Fund, the California Teleconnect Fund, and the Deaf and Disabled Telecommunications Program. The draft OIR indicates that contributions should be required from intrastate end-users of interconnected VoIP service because the Federal Communications Commission (FCC) had already undertaken similar action in regards to the Federal Universal Service Fund (USF) and found that “the application of state universal service contribution requirements to interconnected VoIP providers does not conflict with federal policies and could, in fact, promote them.” Initial responses to the OIR would be due 45 days after its mailing. The draft OIR associated with this item is available here.

  • Certificate of Public Convenience and Necessity Granted to DTS of CA, Inc. (Item 39, held to January 13, 2011 by Staff) – This Proposed Decision would grant a certificate of public convenience and necessity to DTS of CA, Inc. to construct telecommunications facilities and to provide local exchange and interexchange service to unserved territories in California.  The Proposed Decision assocaited with this item is available here.

  • SIGNIFICANT ENERGY ITEMS


    • Commission Approves California Renewables Program Renewable Auction Mechanism

    (Item 51, adopted 5-0 on regular agenda) – By this Decision, the CPUC adopts a new renewable energy portfolio tool called a Renewable Auction Mechanism (RAM) that allows utilities to procure 1,000 megawatts of capacity from eligible renewal projects up to 20 megawatts in size. Auctions will be held twice a year over a two year period, and individual prices will be set by sellers submitting non-negotiable bids to the utilities. The new standard will require investor-owned utilities to increase procurement from eligible renewable energy resources by at least one percent of their retail sales annually, until they reach 20 percent by 2020. President Peevey noted that projects in this size range can help advance California’s renewable energy and climate change agenda, and competitive auctions can lead to the best prices for ratepayers for such renewable energy in the marketplace. The Final Decision associated with this item is available here.

  • Commission Adopts Reform of Combined Heat and Power Facility Regulation (Item 26, adopted 5-0 on regular agenda) – This Decision adopts comprehensive settlement that reforms the Commission’s regulation of California’s combined heat and power (CHP) facilities. CHP facilities allow the capture of otherwise wasted heat by industrial facilities, universities, hospitals and other facilities by using such heat to create electricity. The settlement reached by the parties to the action sets target goals for the utilities, requires a series of requests for proposals in which CHP owners and developers will bid for contracts with the utilities, and will encourage participation by both existing and new and repowered CHP facilities. President Peevey spoke at length in favor of the settlement, noting that the recent standard for setting prices was “in short, a mess.” California’s CHP facilities are the largest in the United States, and possibly the world, and the commissioners uniformly lauded the transition to the new systems for CHP facilities. The Final Decision associated with this item is available here
  • Commission Increases Energy Efficiency Incentives for California Utilities (Item 52b, adopted 3-2 on regular agenda, Comr. Grueneich reserving right to file a dissent) – This Decision, President Peevey’s alternate) approves financial incentives for California investor-owned utilities for their work in contributing to energy efficiency goals for 2006-2008, namely $29.1 million to Pacific Gas & Electric Company, $24.1 to Southern California Edison, $5.1 million to San Diego Gas & Electric Company, and $9.9 million to Southern California Gas Company. The CPUC established a minimum performance standard in 2007-2008 under which incentive earnings accrued once the energy efficiency portfolios achieved 85 percent of the CPUC’s goals, and all of the investor-owned utilities exceeded those goals. Commissioner Simon noted that he strongly supported the Decision because of its strict accountability with the fair opportunity for financial incentives for the utilities, and the other commissioners argued for a revamped risk-reward system. The Final Decision associated with this item is available here.


    MANAGEMENT AND COMMISSIONER REPORTS


    • Commissioner Grueneich

    spoke warmly about her time at the Commission and the tremendous issues presented by the State of California. She indicated her commitment over her tenure to bring together ratepayer interest with economic development and protection of the environment, commented on her position as the lead commissioner on energy efficiency, noted progress on consumer side of telecommunications of issues, and her work with the California Low Income Oversight Board.
    Commissioner Bohn
    said “it’s been a great ride,” noting that the CPUC has become a place where the best and brightest come to face cutting edge issues. He spoke about the Commission’s collective responsibility to the consumers in the State of California, and commended the Commission staff and its work for the new vision of the State of California. He challenged utilities to think outside the regular business model, and indicated the PUC’s partnership with utilities is ongoing work.

  • Communication Division Manager Jack Leutza spoke regarding the CD’s plan for tracking trends in communications service prices on a quarterly basis starting in 2011, through consideration of competing and substitute services. This tracking process was requested by Commissioner Ryan at the prior Commission meeting. It will create a price index for popular residential services, compare basic service rate changes to closest comparable services and other communications services, and evaluate significant price changes of individual providers relative to its index. The CD also plans on developing a statewide market share analysis, and creating competition analyses in 2011.
  • Administrative Law Judge Clopton noted the retirement of ALJs David Fukutome, Jeffrey O’Donnell, Kirk McKenzie, Victoria Kolakowsky, and former Chief ALJ Angela Minkin.
  • Linked Attorney(s)

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