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On May 11, 2006, the CPUC held its regularly-scheduled agenda meeting.  President Peevey began the meeting by stating that Bohn was “necessarily absent,” and that he “expresses his regrets” for his unavailability.  The agenda involved very few telecommunications-related items, with the only significant decisions in the legislative arena. The meeting began with a flurry of public comments from residents of Felton, California, in connection with a water matter.  Following those comments, the Commission sped through the regular agenda.  However, there were some extensive Commissioner reports and management reports, which Commissioner Peevey jokingly observed had “expanded to fill the time.” The noteworthy telecommunications-related matters on this morning’s agenda are addressed in more detail below.


LEGISLATIVE ITEMS

  • Commission Supports Internet Network Neutrality Bill, If Amended (SJR 24) (Item 39, adopted on consent agenda) – The Commission voted to support SJR 24 subject to certain technical amendments.  This Senate Joint Resolution would urge the President and the Congress to encourage broadband deployment and preserve “network neutrality” with respect to the internet.  The Commission recommends two amendments to this bill.  The first would provide that network neutrality principles are “subject to reasonable network management.”  The second would direct that the resolution be addressed to the FCC, in addition to the President and Congress.
  • Commission Supports 911 Bill Addressing Reverse 911 and Backup Power Issues, If Amended (AB 2393) (Item 40, adopted on consent agenda) – The Commission supports AB 2393, as long as the Legislature appropriates additional funds to cover the incremental administrative costs that will be incurred in connection with the three Orders Instituting Investigation (OII) called for by the legislation.  AB 2393 calls upon the Commission to institute an OII to explore the use of auto-dialers to notify the public of emergencies, and institute a pair of OIIs on the reliability of carriers’ backup power sources.
  • Commission Supports Bill to Expand Scope of CTF Discounts, If Amended (SB 1788) (Item 46, adopted on consent agenda) – The Commission voted on the consent agenda to support SB 1788, with some modest amendments.  This bill would expand the CTF program to include a 40% discount on upgraded and additional installations of high speed internet service for community-based organizations (CBOs) that are offering “nonprofit community technology programs.”  The Commission proposes to expand the scope of this bill to all CTF-eligible CBOs, in order to avoid the administrative costs that would be incurred by the Commission in distinguishing between CBOs that do and do not qualify as offering “nonprofit community technology programs.”  Alternatively, the Commission would support the bill if it allocates 5% of the additional funding to cover the Commission’s anticipated incremental administrative costs for complying with the bill.

SIGNIFICANT HELD ITEMS

  • Gain on Sale Proposed Decision and Alternate (Item 32, 32a, held by Brown for further review until 5/25) – The proposed decision and alternate would resolve the “gain on sale” proceeding, in which the Commission has been examining how to allocate gains and losses upon the sale of non-depreciable utility property.  The proposed decision would allocate 75% of such proceeds to ratepayers, and 25% to shareholders, whereas the alternate would institute a 50/50 split between the two.  Both the alternate and the proposed decision have undergone substantial revisions in recent weeks, and several such revisions were reflected in drafts made available at the Commission meeting.
  • Resolution to Adopt Guidelines for Designating and Recertifying ETCs (Res. T-17002) (Item 5, held by staff until 5/25) – This item would impose heightened reporting requirements on carriers seeking to be designated as ETCs, and also implement ongoing requirements for carriers previously qualified as ETCs.  The item was held to give staff a chance to evaluate further revisions to the draft resolution.
  • Proposed Decision to Grant Intervenor Compensation to Consumer Groups in Connection with Consumer Protection Proceeding (Item 3, held by Grueneich until 5/25 for further consideration) – This proposed decision would partially grant requests by TURN and other consumer groups for additional intervenor compensation in connection with their participation in the consumer protection proceeding. The request seeks compensation for time spent monitoring federal litigation in which carriers sought to overturn the original decision adopting G.O. 168, D.04-05-057. This draft would deny large portions of TURN’s request, based on the fact that many of the costs for which compensation is sought were incurred to prepare for a motion to dismiss that was never brought, and which was rendered moot by the withdrawal of the carriers’ claims.
  • Resolution Granting AT&T Requested Deviation from Public Utilities Code Section 320 Requirements (Res. E-3975) (Item 19, held by staff until 5/25 consent agenda) – This draft resolution would grant AT&T’s request for a deviation from the requirements of Public Utilities Code Section 320, which requires that any new communications or electric distribution facilities be undergrounded if they are in close proximity to designated California scenic highways.  This deviation would be granted on the basis that undergrounding is not economically viable in this circumstance, and that undergrounding would be more environmentally intrusive than putting the additional facilities on existing utility poles.
  • Resolution to Grant SBC Request for Waiver from Penalties Associated with Out-of-Service Intervals (Res. T-17024) (Item 30, held by staff until 5/25) – This draft resolution grants SBC’s request for a waiver of the penalty that would have otherwise applied in connection with repeat out-of-service intervals for residential customers during 2005.  This item would impose a penalty of $2.4 million against SBC, but would waive various other penalties, based on the fact that SBC’s out-of-service violations occurred during months when states of emergency were in effect.
  • Bill Addressing Unauthorized Wireless Charges, and Issues Related to Wireless Contract Changes (SB 440) (Item 42, held by staff for further consideration until 5/25) – This bill would adopt an assortment of requirements related to wireless services. The bill would require wireless carriers to inform customers of their potential liability for wireless charges, in the event that a customer’s wireless handset is stolen, and unauthorized charges are thereby incurred.  The bill would also limit customers’ responsibility for unauthorized charges of this sort to $50.  Moreover, the bill would prevent carriers from changing wireless customers to more restrictive or more expensive plans unless certain prerequisites are met.  There is no preliminary CPUC recommendation on this bill.

NOTES AND COMMISSIONER REPORTS

  • Peevey Reports on Meeting of California Emerging Technologies Fund Committee – Commissioner Peevey reported briefly on the first meeting of the committee that will govern the California Emerging Technologies Fund, a group founded as a result of the SBC/AT&T and Verizon/MCI mergers.  The group is founded to promote greater access to broadband and advanced telecommunications services.  The committee met for the first time on April 27, 2006.  During that meeting, it adopted some bylaws, elected President Peevey as its “chair of the board,” and attended to some other preliminary administrative matters.  Peevey praised AT&T for providing some interim funding and support staff to help get the program started.  Peevey also commended AT&T’s recent efforts to extent broadband services and broadband-related training to the currently-underserved community of Pixley, California, and noted that this is the type of work that the California emerging technologies fund would do in the months and years to come.
  • Staff Provides Further Report on Status of Consumer Protection Initiative – In what has become a tradition since the passage of the consumer protection decision, the Commission staff once again provided an update on the enforcement and consumer education efforts that are currently underway as part of the Consumer Protection Initiative. 

    Executive Director Leutza led off the report, noting that the CPUC’s recent request for $10 million in additional budget resources had been approved in the Senate Budget hearings.  The next step in garnering this funding will be for the Assembly Budget Committee to approve the proposal.  Leutza also noted that efforts are underway to hire additional Commission employees to work on consumer protection, chiefly in the enforcement and consumer affairs groups.

    Phillip Enis then reported on the recent workshop that was held to work on the short-term consumer education efforts to be initiated in June.  Enis mentioned the four types of content that would be provided on the website starting in June, including a slamming/cramming brochure, a document explaining how to read a bill, a document summarizing various areas of importance to the telecommunications consumer, and a document addressing issues related to wireless services.  Enis also addressed the status of the consumer education website that is expected to go online in June.  When he noted that it might be a bit behind schedule, Commissioner Chong chimed in, emphasizing that the website is “on track.”  As Chong noted, “we purchased the (domain) name, . . . we are designing the logo this week – it is on track.” 

    Enis also provided a status report on the “in language” portion of the Consumer Protection Initiative, indicating that a workshop may take place in early June to address those issues. Lastly, Enis thanked Commissioner Grueneich for following Commissioner Chong’s lead in visiting the Consumer Affairs Branch (CAB) earlier in the week.  Enis expressed his hope that Chong and Grueneich would be the “fairy Godmothers” for CAB.  This elicited a swift retort from Chong, who said “get me a wand, and I will take that on.” 

    To conclude the discussion of the Consumer Protection Initiative, CPSD Director Clark reported that a revised draft resolution on the slamming citation program would be released within the next two weeks.  Commissioner Brown urged Clark to consider the impact that carrier winback efforts might have on the slamming issue, particularly when combined with the fact that the LECs are the PIC administrators.  In response, Clark emphasized the limited nature of the slamming citation program, which is focused on penalizing carriers who fail to provide third party verification tapes.  

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