BILL ANALYSIS
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THIRD READING
Bill No: AB 219
Author: Assembly Utilities and Commerce Committee
Amended: 6/21/01 in Senate
Vote: 27 - Urgency
SENATE ENERGY, U.&C. COMMITTEE : 7-0, 4/24/01
AYES: Bowen, Morrow, Alarcon, Battin, Murray, Speier,
Vincent
SENATE APPROPRIATIONS COMMITTEE : 9-0, 5/21/01
AYES: Alpert, Battin, Bowen, Burton, Escutia, Johnson,
Murray, Perata, Poochigian
SENATE FLOOR : 39-0, 5/29/01
AYES: Ackerman, Alarcon, Alpert, Battin, Bowen, Brulte,
Burton, Chesbro, Costa, Dunn, Escutia, Figueroa, Haynes,
Johannessen, Johnson, Karnette, Knight, Kuehl, Machado,
Margett, McClintock, McPherson, Monteith, Murray,
O'Connell, Oller, Ortiz, Peace, Perata, Polanco,
Poochigian, Romero, Scott, Sher, Soto, Speier, Torlakson,
Vasconcellos, Vincent
ASSEMBLY FLOOR : 73-1, 4/16/01 - See last page for vote
SUBJECT : Public utilities: deaf and disabled program
SOURCE : Author
DIGEST : This bill extends until January 1, 2006, the
surcharge on intrastate telephone service used to pay for
the Deaf and Disabled Telecommunications Program, which
CONTINUED
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provides telecommunications devices and services for the
deaf and hearing impaired, and for the disabled.
Senate Floor Amendments of 6/21/01 limit the borrowing
authority of the fund that pays for the deaf and disabled
telecommunications service and provide more specificity on
how and when the loan is paid back.
ANALYSIS : Current law establishes several programs to
assist the deaf and hearing impaired use the telephone.
These programs include providing telecommunications
devices, funding a dual-party relay service, and equipping
telephones in public places with proper equipment. Funding
for these programs, which is limited to 0.5 percent of all
in-state telephone bills, sunsetted on January 1, 2001.
This bill extends the sunset for five years.
The bill permits these programs to be funded from other
existing telecommunications programs on a temporary basis.
The bill authorizes the transfer of funds from the
California High-Cost Fund-B Trust to the Deaf Equipment
Acquisition Fund Trust in an amount sufficient to cover the
costs of the DDTP for up to six months, or $28.5 million.
Fund B is used to help subsidize rural phone customers and
currently has a balance of about $900 million and a backlog
of claims. In addition, the bill requires the PUC to
reimburse the Fund B for any such transfer with moneys from
the Deaf and Disabled Telecommunications Program (DDTP)
Administrative Committee Fund. (According to California
Public Utilities Commission [PUC] staff, this provision is
necessary because the DDTP Fund will be depleted by
approximately July 1, 2001, and it is likely the surcharge
won't be implemented until 60 days after the effective date
of this bill.)
This bill sunsets the borrowing authority on October 1,
2001, and require that the repayments be noted in separate
memorandum accounts. After July 1, 2002, the Deaf
Equipment Acquisition Fund Trust funds shall be moved from
the PUC to the state treasury.
Background
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The roots of the programs to help the deaf and hearing
impaired use the telephone go back to 1979 when legislation
required the PUC to implement a program to distribute
specialized telecommunications equipment to deaf
individuals. In 1983, legislation required a statewide
dual-party relay service which permits deaf and hearing
impaired individuals to communicate with others via an
operator, predating the federal requirement for such a
program by seven years. In 1999, the programs in this bill
allowed over 400,000 Californians to use specialized
telephone devices and carried over seven million telephone
calls through the dual-party relay service at a cost of $43
million.
AB 2757 (Assembly Utilities & Commerce Committee), which
would have extended the surcharge much as this bill
proposes to do, was passed by the Senate last year 32-0 and
by the Assembly 73-3. However, the bill was vetoed by the
Governor due to provisions unrelated to the surcharge
extension.
Though the authority to impose the surcharge has sunset,
the requirements of the program have not. To date, the
expenses of the program have been paid from program reserve
funds, which are expected to be exhausted by July 2001.
Should the authority to impose the surcharge be restored,
the surcharge can only apply prospectively. Given the lag
in billing and the lag between rendering the bill and
receiving cash, even if this bill is enacted at the end of
June, cash probably won't flow into the fund until
September. It is for that reason that the bill permits the
program to borrow funds for a limited time from a separate
telecommunications-related account (California High-Cost
Fund-B Trust Account).
The amendment which requires the DEAF Trust funds to be
transferred from the PUC to the state treasury is a
reiteration of a requirement imposed by SB 669 (Polanco),
Chapter 677, Statutes of 1999. That bill created the
equivalent of the DEAF Trust in the state treasury and
required the PUC to develop a schedule for transferring the
DEAF Trust funds to the treasury. This amendment requires
that the transfer occur on July 1, 2002.
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FISCAL EFFECT : Appropriation: Yes Fiscal Com.: Yes
Local: No
The PUC advises it would incur no net costs as a result of
this bill.
The surcharge brings annual revenues of potentially $50
million to fund the DDTP program.
Potential transfer of up to $28.5 million.
SUPPORT : (Verified 6/21/01)
California Self Help for Hard of Hearing People
California Speech-Language-Hearing Association
ASSEMBLY FLOOR
AYES: Alquist, Aroner, Ashburn, Bates, Bogh, Briggs,
Calderon, Bill Campbell, John Campbell, Canciamilla,
Cardoza, Cedillo, Chan, Chavez, Cogdill, Cohn, Corbett,
Correa, Cox, Daucher, Diaz, Dickerson, Dutra, Firebaugh,
Florez, Frommer, Goldberg, Harman, Havice, Horton,
Jackson, Keeley, Kehoe, Kelley, Koretz, La Suer, Leach,
Leonard, Leslie, Longville, Lowenthal, Maddox, Maldonado,
Matthews, Migden, Nakano, Nation, Negrete McLeod,
Oropeza, Robert Pacheco, Rod Pacheco, Papan, Pavley,
Pescetti, Reyes, Richman, Runner, Salinas, Shelley,
Simitian, Steinberg, Strickland, Strom-Martin, Thomson,
Vargas, Washington, Wayne, Wesson, Wiggins, Wright,
Wyland, Zettel, Hertzberg
NOES: Wyman
NC:kb 6/22/01 Senate Floor Analyses
SUPPORT/OPPOSITION: SEE ABOVE
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