BILL ANALYSIS                                                                                                                                                                                                    




                    Appropriations Committee Fiscal Summary
          
                                           1874 (Cohn)
          
          Hearing Date:  8/12/04          Amended: 7/2/04 and  
          proposed to be
                                                                       
                   amended                    
          Consultant:  Lisa Matocq            Policy Vote: E, U & C  
          7-0                      
          ____________________________________________________________ 
          ___
          BILL SUMMARY:  AB 1874 reduces, from 60 to 45 days, the  
          time period for the Department of Transportation (Cal  
          Trans) to (1) approve or deny an application from a  
          telephone or cable television corporation for an  
          encroachment permit, and (2) issue a final written  
          determination in response to a related appeal.  The bill  
          also establishes state policy related to communications  
          services.  
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          ___
                          Fiscal Impact (in thousands)
           Major Provisions                    2004-05             2005-06   
                      2006-07            Fund
           Cal Trans              Unknown costs, potentially $200-300   
                       Special*
                                 annually for one to two years.   
          Costs should 
                                 be offset by fee revenues.

          *State Highway Account 
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          ___

          STAFF COMMENTS:  SUSPENSE FILE.  Cal Trans processes  
          approximately 16,000 encroachment permits annually.  Of the  
          current 270 staff assigned to permitting, 90 are  
          responsible for the particular type of permitting affected  
          by this bill.  Increased costs for Cal Trans to hire  
          additional staff to process these encroachment permits  
          within a shorter time period could be $1.96 million  
          annually for one to two years, assuming a 25% increase in  
          workload. 

          The bill also specifies that it is the policy of the state  










          to, among other things: (1) "Promote the availability of a  
          wide range of communications services to residents?", (2)  
          "?increase investment in the communication infrastructure  
          of this state," and (3) "Improve the opportunities for  
          economic development and the delivery of communications  
          services."  It is unknown what cost pressures the above  
          mentioned policies may create for state agencies. 

          In addition, Cal Trans has expressed concern that Sec.  
          14666.9(c) on page 3, lines 36-38 could impact pending  
          litigation between the department and SBC that could result  
          in potentially significant foregone revenues for the use of  
          freeway rights-of-way by telecommunications companies.  
          Since 2000, more than $10 million has been collected from  
          telecommunications companies for the use of such  
          rights-of-way. 

          AMENDMENTS:  The amendments strike Section 2 of the bill  
          related to state policy regarding economic development,  
          increased investment, etc., and Sec. 14666.9(c) mentioned  
          above.