BILL ANALYSIS 1 1 SENATE ENERGY, UTILITIES AND COMMUNICATIONS COMMITTEE DEBRA BOWEN, CHAIRWOMAN SB 1563 - Polanco Hearing Date: April 23, 2002 S As Amended: April 22, 2002 FISCAL B 1 5 6 3 DESCRIPTION Current law articulates California's telecommunications policies. These policies include universal service, encouraging the ubiquitous availability of a wide choice of state-of-the-art telecommunications services, and adequate investment in telecommunications infrastructure. This bill adds to those policies by: 1)Specifically articulating a desire to bridge the "digital divide." 2)Making explicit a policy of encouraging fair treatment of consumers by providing them with necessary information, establishing reasonable service quality standards, and creating processes to resolve billing and service problems. 3)Substituting a desire to "promote a level playing field" for the current policy of "avoiding anti-competitive conduct." This bill also requires the California Public Utilities Commission (CPUC) to convene a proceeding to develop a plan for encouraging the ubiquitous availability of advanced telecommunications infrastructure, and to report back to the Legislature by February 1, 2004. BACKGROUND California's telecommunications policy has a long history of promoting universal service and consumer-friendly practices. Over the last several years, there's been increasing interest in the telecommunications infrastructure and the availability of advanced communications service, due to a recognition of the "digital divide" issue and the positive effects that advanced communications infrastructure can have on the economic development prospects of a region. Recent legislation has focused on having the CPUC re-examine universal service in the context of expanding the types of services it encompasses. Each time the CPUC, after discussions with service providers and customers, declined to expand the scope of services, citing cost issues. The CPUC's latest examination is due imminently, but some observers don't believe the CPUC will reach conclusions that are any different from its prior conclusions. The CPUC has long established service quality standards for traditional telephone service. These standards are articulated in General Order No. 133 and include measurements of delays in installing new telephone lines, customer reports of service dissatisfaction, and time to answer directory assistance calls. Last year, the CPUC opened a proceeding to establish consumer protection rules for telecommunications services (Order Instituting Rulemaking 00-02-004). The basis for those rules are six policies: 1) product information disclosure, 2) customer choice, 3) privacy, 4) public participation, 5) oversight and enforcement, 6) accurate bills and redress. Those rules are due to be released in the near future. In addition, the CPUC responds to specific circumstances where service quality or customer service issues arise, such as individual customer complaints or customer-classwide deceptive sales practices allegations. In the context of its current review of the regulatory framework for Pacific Bell and Verizon, the CPUC also required extensive customer surveys of service quality. COMMENTS 1.Digital Divide . The bill explicitly adds to the state's telecommunications policies the goal of bridging the "digital divide," which refers to the unequal degree of access to computer and communications capabilities throughout society and the impact of such inequality on the quality of life for those individuals and communities. The CPUC has already taken some steps to address the issue, notably the creation of the California Teleconnect Fund. 2.Level That Playing Field . The author's rationale for replacing the concept of "avoidance of anticompetitive conduct" with "promote a level playing field among providers" is that anticompetitive conduct is already illegal, so a policy statement on avoiding anticompetitive conduct is redundant. Promoting a level (regulatory) playing field encompasses the concept of avoiding anticompetitive behavior, but more importantly, it's also a broader statement aimed at requiring regulatory fairness. 3.Definition of Universal Service . Previous bills before the Legislature asked or required the CPUC to consider expanding the universal service definition, which the CPUC declined to do. This bill takes a different tact by asking the CPUC to develop a plan which encourages the deployment of advanced communications infrastructure, and report such a plan back to the Legislature by February 1, 2004. The bill specifically requires the CPUC to include a broad cross section of interests, including those service providers which are not regulated by the CPUC, in developing the plan. 4.Prior Legislation . AB 1289 (Moore), Chapter 1274, Statutes of 1993, required the CPUC to consider 1) broadening the list of services included within the universal service definition, and 2) how to encourage the deployment of advanced communications infrastructure. SB 2150 (Peace), Chapter 266, Statutes of 1998 required the CPUC to consider whether the regulatory structure encourages companies to provide high-speed communications services. SB 1712 (Polanco), Chapter 943, Statutes of 2000, encouraged the CPUC to consider redefining universal telephone service to include video and data services and to promote equity of access to such services. POSITIONS Sponsor: Author Support: None on file Oppose: None on file Randy Chinn SB 1563 Analysis Hearing Date: April 23, 2002