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On Thursday, September 18, 2008, the California Public Utilities Commission held its regularly-scheduled agenda meeting. The meeting was rather lengthy, in part due to a large volume of public speakers, and in part due to the Commission’s extensive discussion of the railroad accident last week in Southern California. Significantly, the Commission approved a decision establishing a transition plan for price increases on basic service rates for URF carriers. The Commission also adopted new construction standards for pole-top antennas, and issued an emergency decision banning cell phone use by train operators following the collision in Southern California last week. These and other telecommunications-related items addressed during the meeting are summarized below.


REGULAR AND CONSENT AGENDA ITEMS

  • Decision Establishing Basic Service Flexibility Transition Plan for URF Carriers Adopted (Items 41, adopted 5-0) – The Commission adopted the proposed decision of Commissioner Chong in this proceeding, which permits transitional increases in basic rate charges for carriers regulated under the Uniform Regulatory Framework over the next two years. According to the URF Phase I Decision (D.06-08-030), restrictions on basic service rates for the four major ILECs are set to expire on January 1, 2009. The pricing transition decision adopted on Thursday allows the URF ILECs to increase their basic flat rates by up to $3.25 on January 1, 2009, and by up to an additional $3.25 on January 1, 2010. Measured rates may be increased by a corresponding percentage for each carrier. Beginning in 2011, the ILECs will be allowed full pricing flexibility. A major concern with this decision was the effect of price increases on the LifeLine rate, particularly since the Commission has not yet acted to de-link the LifeLine rate from AT&T’s basic rate. This decision sets a basic rate service cap for two years for LifeLine customers at 25% of the increases allowed for regular customers. This rate will be subject to change based on the outcome of the Commission’s decision in its current public policy fund reform proceeding. To refresh the record in that proceeding, additional comments from the parties are being solicited, with a comment deadline of October 1, 2008. The decision also orders an affordability study to be conducted by June 30, 2010 to analyze the impacts of the transition plan on the LifeLine program and on LifeLine customers.

    Commissioner Grueneich had authored an alternate proposed decision that would have prohibited any increases in the LifeLine rate, and which called for more extensive analysis of affordability issues. However, based on some late revisions to the Chong proposed decision that incorporated some of Grueneich’s proposals, Commissioner Grueneich was persuaded to withdraw her alternate and support the Chong proposal. Although she ultimately supported the decision, Grueneich reserved the right to file a concurrence, as did Commissioners Bohn and Simon. In her comments on the Chong proposed decision, Commissioner Grueneich reiterated that the CPUC is “here to serve the public.” She worried whether the decision, even in its revised form, had the proper safeguards to prevent harm to customers from price increases. “If competition does not control the market once the rate caps are removed,” mused Grueneich, “will the CPUC be able to respond as it should to serve the public?” Interestingly, she also noted that the Commission’s consideration of affordability issues must include not only telephone lines, but the “whole panoply of services” for which telecommunications customers must pay. Commissioner Bohn somewhat echoed her sentiments by promising that the Commission would “commit to keeping an eye on it.” A recent version of the decision is available at the following link: http://docs.cpuc.ca.gov/WORD_PDF/AGENDA_DECISION/91018.DOC.

  • Personal Use of Cell Phones Banned for Operators of Passenger and Freight Trains and Rail Transit Vehicles (Item 55, adopted 5-0) – In response to the fatal collision of a freight train and a commuter train on September 12, 2008 near Chatsworth in Southern California, the Commission adopted Resolution SX-88 on an emergency, expedited basis. prohibiting the personal use of cell phone services while operating passenger or freight trains and light rail transit vehicles. Although investigations are ongoing, preliminary reports have indicated that the engineer who was driving one of the trains in the accident may have been text messaging on his cell phone just prior to the collision. The resolution is adopted on an interim basis pending further investigation by the Consumer Protection and Safety Division as to whether or not such measures should be implemented permanently. Pursuant to its statutory authority in Government Code Section 11125.3(a)(2), the Commission added this resolution after the agenda had been mailed, based upon the need for immediate action.

    Each of the Commissioners expressed shock at the fact that neither the Federal Railroad Administration nor the Federal Transit Administration presently has a rule or regulation specifically prohibiting the personal use of cell phones for on-duty railroad engineers, brakemen, conductors, or rail transit vehicle operators. The Commissioners found this particularly egregious considering this is the third accident within a year in which cell phone use has been implicated as a contributing factor. Citing broader efforts afoot at the federal level, President Peevey called the resolution a “very modest first step in a much more drastic effort that has to be made in order to ensure rail safety.” The final draft of the resolution is available at the following link: http://docs.cpuc.ca.gov/WORD_PDF/FINAL_RESOLUTION/91055.DOC.

  • Resolution Modifying Slamming Citation Program Adopted, Res. UEB-002 (Item 7, adopted on consent agenda) – The Commission adopted Resolution UEB-002, which adds four new requirements to third party verification (“TPV”) requirements, paralleling the requirements adopted in a recently-effective FCC order on the same subject. The resolution incorporates the new requirements into UEB-001, the resolution originally adopting the Commission’s Slamming Citation Program. The new pieces of information that carriers must verify during the TPV process are: 1) the date of the verification; 2) confirmation that the person on the call understands that a carrier change, not an upgrade to existing services, bill consolidation, or any other misleading description of the transaction, is being authorized; 3) any description of interLATA or long distance service shall convey that it encompasses both international and state-to-state calls, as well as some intrastate calls where applicable; and 4) if the subscriber has additional questions for the carrier’s sales representative during the verification, the verifier shall indicate to the subscriber that, upon completion of the verification process, the subscriber will have authorized a carrier change. A draft copy of the resolution can be found at the following link: http://docs.cpuc.ca.gov/word_pdf/AGENDA_RESOLUTION/86757.doc.

  • Approval of Decision Finding Global NAPs California in Breach of Agreement with Pacific Bell (Item 10, adopted on consent agenda) – The Commission adopted the modified Presiding Officer’s Decision finding that Global NAPs California (“GNAPs”) breached its interconnection agreement with Pacific Bell Telephone Company, now AT&T California (“AT&T”), by failing to pay amounts billed for AT&T’s termination of GNAPs’ intraLATA toll traffic. The decision held that GNAPs owes AT&T $18,589,494.17 through the December 2007 bill, plus any charges that have accrued since that time. GNAPs had contended that it was exempt from payment under the Enhanced Service Provider (“ESP”) exemption and that the disputed traffic is IP-based and therefore beyond the Commission’s jurisdiction. These arguments were considered and rejected. A draft of the proposed decision is available at the following link: http://docs.cpuc.ca.gov/word_pdf/AGENDA_DECISION/90959.doc.

  • Revocation of Certificates for Noncompliance Approved (Item 45, adopted on consent agenda) – The Commission approved a decision revoking the certificates of eight carriers for failure to comply with Public Utilities Code Section 401. The carriers failed to file Public Utilities Commission Reimbursement Account Reports and the Remitting of Applicable Fees. A draft of the resolution may be found at the following link: http://docs.cpuc.ca.gov/word_pdf/COMMENT_RESOLUTION/86766.doc.


SIGNIFICANT HELD AND WITHDRAWN ITEMS

  • Proposed Decision Regarding Removal of Copper Loops (Item 42, held by Simon until 10/2 for further review) – This proposed decision would decline to adopt any rules requiring carriers to seek the Commission’s permission before permanently removing copper wire local loops. The California Association of Competitive Telecommunications Companies (“CALTEL”) initiated this application proceeding requesting a set of rules addressing copper loop retirement and related issues. The proposed decision is available at the following link: http://docs.cpuc.ca.gov/word_pdf/AGENDA_DECISION/91001.doc.

  • Proposed Decision Addressing Phase II Issues In “In-Language” Proceeding (Item 43, held by Staff until 10/2) – This proposed decision would resolve Phase II of the “in-language” proceeding. The decision would address the following issues relative to the Commission’s interest in protecting customers with Limited English Proficiency (“LEP”): (1) whether to adopt tracking and reporting of LEP consumer complaints and language preference information, (2) whether to require carriers to provide fraud notification to LEP consumers, and (3) whether to adopt relaxed rules governing market trials in non-English languages. The proposed decision is available at the following link: http://docs.cpuc.ca.gov/word_pdf/AGENDA_DECISION/87579.doc.

  • Proposed Decision Establishing Uniform Construction Standards for Pole-Top Antennas (Item 44, held by Simon until 10/2 for further review) – This proposed decision would adopt an uncontested proposal to revise General Order 95, the Commission’s General Order governing the construction of overhead utility facilities. These changes establish uniform construction standards for wireless antennas installed on utility poles above or between power lines operating at zero to 50,000 volts. The purpose of the adopted revisions is to facilitate the expansion of California’s wireless infrastructure in a way that protects the safety of workers and the public, minimizes costs and potential environmental impacts, and maintains the reliability of equipment and facilities attached to poles by electric utilities and telecommunications providers. The proposed decision is available at the following link: http://docs.cpuc.ca.gov/word_pdf/AGENDA_DECISION/90837.doc.


NOTES AND COMMISSIONER REPORTS

  • 760 Area Code Split Reconsidered –- Several public speakers at the meeting addressed the always-contentious issue of area code splits, this time in the context of complaints about the 760 area code. On April 24, 2008, the CPUC issued Decision 08-04-058, which split the current 760 area code and created the 442 area code. In response to a petition by Assemblyman Martin Garrick and the Chambers of Commerce of Carlsbad, Encinitas, Escondido, Oceanside, San Marcos, and Vista, the Commission decided to revisit the matter. On September 16, the Commission issued a proposed decision granting the petition for modification and ordering an overlay for the 760 area code instead of a split. The CPUC is scheduled to consider the proposed decision on October 16. The proposed decision is available at the following link: http://docs.cpuc.ca.gov/efile/PD/90865.pdf.

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