BILL ANALYSIS                                                                                                                                                                                                    



                                                                       


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                              UNFINISHED BUSINESS


          Bill No:  SB 1863
          Author:   Bowen (D)
          Amended:  7/18/02
          Vote:     21

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

           SENATE FLOOR  :  37-0, 4/22/02
          AYES:  Ackerman, Alarcon, Alpert, Battin, Bowen, Brulte,  
            Burton, Chesbro, Dunn, Figueroa, Haynes, Johannessen,  
            Johnson, Karnette, Knight, Kuehl, Machado, Margett,  
            McClintock, McPherson, Monteith, Morrow, Murray,  
            O'Connell, Ortiz, Peace, Perata, Polanco, Poochigian,  
            Romero, Scott, Sher, Soto, Speier, Torlakson,  
            Vasconcellos, Vincent

           ASSEMBLY FLOOR  :  56-7, 8/8/02 - See last page for vote


           SUBJECT  :    Telecommunications services

           SOURCE  :     Author


           DIGEST  :    This bill adds to the State's articulated  
          policies for telecommunications. 

           Assembly Amendments  state the intent of the Legislature  
          that the State Public Utilities Commission should provide a  
          nonprofit community technology program with discounts  
          comparable to those that are provided to schools and  
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          libraries to address inequality of access to advanced  
          telecommunications services, and double-joins the bill to  
          SB 1563 (Polanco).

           ANALYSIS  :   Current law establishes the policy of  
          "universal telephone service."  Current regulations provide  
          for the California Teleconnect Fund, which provides  
          discounted telephone service to schools, libraries, health  
          care institutions, and community-based organizations.
           
           This bill adds to the State's telecommunications policies.   
          Specifically, the bill:
           
           1.Declares that it is a state telecommunications policy to  
            focus efforts on providing educational institutions,  
            health care institutions, community based organizations,  
            and governmental institutions with access to advanced  
            telecommunications services in recognition of their  
            economic and societal impact.

          2.Declares the intent of the Legislature that any program  
            administered by the State Public Utilities Commission  
            (PUC) that address the inequality of access to advanced  
            communication services by providing those services to  
            schools and libraries at a discounted price should also  
            provide comparable discounts to nonprofit community  
            technology programs.

          3.Defines a nonprofit community technology program as a  
            community-based 501(c)(3) tax-exempt that disseminates  
            technology in local communities and trains local  
            communities with limited access to the Internet and other  
            technologies.

          4.Is double-joined to SB 1563 (Polanco).

           Background  

          California has a long history of encouraging the widespread  
          deployment of telecommunications service.  A number of  
          programs exist to subsidize telephone service in rural  
          areas, for the deaf and handicapped, and for the poor.  

          Eight years ago, the Legislature passed and the Governor  







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          signed AB 3643 (Moore & Polanco), Chapter 278, Statutes of  
          1994, an uncodified measure which recognized that state  
          action was necessary to prevent society from splitting into  
          two different "information worlds," one that was  
          information rich, and the other that was information poor.   


          That dichotomy has come to be known as the digital divide.   
          AB 3643 addressed the issue by requiring the California  
          Public Utilities Commission (CPUC) to look at universal  
          service in the context of changes in technology and  
          information availability.  The bill declared that  
          "Universal service must be defined in a way that ensures  
          all segments of California society have access to the  
          technology that will allow them to enjoy the benefits of  
          the Information Age and the Information Superhighway."   
          Among the principles in the bill was that "health care,  
          community, and government institutions be early recipients  
          of the benefits of the Information Age."

          The CPUC responded to the AB 3643 mandate in part by  
          creating the California Teleconnect Fund (CTF).  This fund,  
          currently budgeted at $57.125 million annually and funded  
          by a 0.31 percent surcharge on telephone bills, provides  
          funding for telephone service discounts of 50 percent to  
          schools, libraries, and 25 percent to community-based  
          organizations.  Since its inception, more than 99 percent  
          of the program funds have gone to discounts for schools and  
          libraries.

          This bill buttresses the basis for the CTF program by  
          codifying the uncodified language from AB 3643 upon which  
          the CTF is based.
          In 1996, Congress enacted legislation similar to AB 3643,  
          requiring that schools, health care providers, and  
          libraries have access to advanced communications services.   
          The resulting program, known as the e-rate program,  
          provides $2.25 billion in telecommunication service  
          discounts nationwide.
           
          Comments  

           Who can receive grants  ?  As noted above, virtually 100  
          percent of the money in the CTF has been awarded to schools  







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          and libraries.  Community-based organizations (CBOs)  
          believe they've grown exponentially in terms of providing,  
          through their community technology centers, people with an  
          important channel for bridging the digital divide.   
          However, they contend they receive a miniscule amount of  
          money from the CTF, and it's not fair to provide them with  
          a lower discount rate than schools and libraries.

          This bill is designed to open the discussion on who should  
          be allowed to apply to the CTF for grants and what types of  
          grants (and discounts) those applicants should be allowed  
          to receive.

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

           SUPPORT  :   (Verified  8/8/02)

          California Community Technology Policy Group
          Office of Ratepayer Advocates
          The Children's Partnership


           ASSEMBLY FLOOR  
          AYES:  Aroner, Bogh, Calderon, Canciamilla, Cardenas,  
            Cardoza, Cedillo, Chan, Chavez, Chu, Cohn, Correa, Diaz,  
            Dickerson, Dutra, Firebaugh, Frommer, Goldberg, Harman,  
            Havice, Horton, Jackson, Keeley, Kehoe, Koretz, Leslie,  
            Liu, Longville, Lowenthal, Maddox, Maldonado, Matthews,  
            Nakano, Nation, Negrete McLeod, Oropeza, Rod Pacheco,  
            Papan, Pavley, Pescetti, Reyes, Richman, Salinas,  
            Shelley, Simitian, Steinberg, Strickland, Strom-Martin,  
            Thomson, Vargas, Washington, Wayne, Wiggins, Wright,  
            Zettel, Wesson
          NOES:  Aanestad, Ashburn, Bill Campbell, John Campbell,  
            Leach, Mountjoy, Wyland

          NC:kb  8/9/02   Senate Floor Analyses 

                         SUPPORT/OPPOSITION:  SEE ABOVE

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