BILL ANALYSIS                                                                                                                                                                                                    



                                                                       


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          |SENATE RULES COMMITTEE            |                  AB 1734|
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                                 THIRD READING


          Bill No:  AB 1734
          Author:   Assembly Utilities and Commerce Committee
          Amended:  5/13/02 in Senate
          Vote:     27 - Urgency

           
          SENATE ENERGY, U.&C. COMMITTEE  :  8-0, 4/9/02
          AYES:  Bowen, Morrow, Alarcon, Battin, Murray, Sher,  
            Vasconcellos, Vincent

           SENATE APPROPRIATIONS COMMITTEE  :  8-0, 5/6/02
          AYES:  Alpert, Battin, Bowen, Johannessen, Johnson,  
            Karnette, Perata, Poochigian

           ASSEMBLY FLOOR  :  Not relevant


           SUBJECT  :    Telecommunications services

           SOURCE  :     State Public Utilities Commission


           DIGEST  :    This bill makes changes to the Deaf and Disabled  
          Telecommunications Program, within the State Public  
          Utilities Commission.

           ANALYSIS  :    Current law establishes programs to enable and  
          subsidize telecommunications service for the deaf, hearing  
          impaired, and handicapped.  

          The Deaf and Disabled Telecommunications Program (DDTP) was  
          established about 20 years ago and provides  
          telecommunications services to approximately 500,000  
          persons who are deaf, hearing impaired, or handicapped.  It  
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          is estimated that three million people may be eligible for  
          service.  The current program budget is approximately $56  
          million, but is projected to be $69 million in 2002-03,  
          accounting for an already approved expansion in relay  
          service.  DDTP revenues are derived from a surcharge on all  
          intrastate telecommunications billings.

          The Deaf and Disabled Telecommunications Program  
          Administrative Committee (DDTPAC) advises the State Public  
          Utilities Commission (PUC) on the administration of this  
          program.  DDTPAC's budget is approximately $2.6 million.

          Current law establishes a fund in the state treasury to  
          receive monies in support of this program and to disburse  
          monies to pay for this program.  The PUC is required to  
          transfer funding for these programs from a PUC-administered  
          account to this account by July 1, 2002.

          This bill authorizes the PUC, subject to annual  
          appropriation of funds by the Legislature, to contract with  
          others to operate the telecommunications programs for the  
          deaf, hearing impaired, and handicapped, and makes  
          supportive findings.

          This bill, commencing July 1, 2003, renames the DDTPAC as  
          the Telecommunications Access for Deaf and Disabled  
          Administrative Committee (TADDAC) and requires that not  
          less than two-thirds of the committee membership be deaf or  
          disabled.

          This bill specifies, commencing July 1, 2003, that any  
          increased staffing costs incurred by the PUC for the  
          oversight and administration of the program be funded by  
          the Deaf and Disabled Telecommunications Program  
          Administrative Committee Fund.

          This bill delays the transfer of program funds from the PUC  
          to the TADDAC account in the treasury until July 1, 2003 by  
          which time the TADDAC must develop a transition plan for  
          program administration and governance and submit it to the  
          PUC.

          This bill requires the PUC to employ staff overseeing the  
          deaf and disabled telecommunications program who, to the  







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          extent feasible and consistent with state civil service  
          requirements, are members of the deaf and disabled  
          community.

           Background

           Since the 1980's, the PUC has administered programs to  
          assist the deaf and disabled in using telephone service.   
          The programs provide specialized telecommunications  
          equipment, discounted telephone rates, and a  
          telecommunications translator service, known as a  
          dual-party relay service, through which the deaf can  
          communicate with others.  Funding for these programs is  
          provided by a surcharge on telecommunications service,  
          which has been kept in accounts administered by the PUC.  
          Aggregate program costs are about $50 million annually.   
          These programs are currently contracted out, with the  
          DDTPAC providing advice and program administration to the  
          PUC.

          SB 669 (Polanco), Chapter 677, Statutes of 1999, was  
          enacted to move this account, as well as all specially  
          funded telecommunications accounts, from the PUC into the  
          state treasury.  The transfer of funds into the state  
          treasury meant that fund administrators and programmatic  
          employees could no longer be contracted out without  
          legislative authorization, a restriction affecting 94  
          employees.  Consequently, SB 669 also required the PUC to  
          develop a plan to have the programs administered by state  
          employees instead of being contracted out.

          The PUC's transition plan suggested three approaches to  
          changing the current system:

            Option 1 makes the administrative and programmatic  
            employees into PUC state employees.

            Option 2 obtains contracting out authority. 

            Option 3 transfers the employees to another state  
            agency serving the disabled.

          This bill chooses Option 2.








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           FISCAL EFFECT  :    Appropriation:  No   Fiscal Com.:  Yes    
          Local:  No

                          Fiscal Impact (in thousands)

           Major Provisions            2002-03            2003-04           
             2004-05             Fund

           PUC staff for contract   Potential increased costs of $220   
                          Special*
          administration               annually beginning 2003-04,  
          offset by
                                                surcharge revenue

          Contract for admini-     Unknown costs or savings.  Any  
          increased   Special*
          stration                          costs should be offset by  
          surcharge
                                                revenues

          TADDA Committee      Potential cost savings of $185  
          annually,       Special*
                                                 beginning 2003-04

          Funds transfer                Delays, from July 1, 2002 to  
          July 1, 2003,   Special*
                                                 the transfer of an  
          unknown amount from
                                                 the DEAF Trust to  
          the DDTPACF

           *Deaf and Disabled Telecommunications Program  
           Administrative Committee Fund (DDTPACF)

           SUPPORT  :   (Verified  5/14/02)

          State Public Utilities Commission (source)
          California Coalition of Agencies Serving Deaf and Hard of  
          Hearing, Inc.
          Deaf Community Services of San Diego, Inc.
          Greater Los Angeles Council on Deafness, Inc.
          Office of Ratepayer Advocates
          Orange County Deaf Equal Access Foundation
          Self Help for Hard of Hearing People







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          6 individuals


          NC:cm  5/15/02   Senate Floor Analyses 

                         SUPPORT/OPPOSITION:  SEE ABOVE

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