BILL ANALYSIS                                                                                                                                                                                                    



                                                                  AB 2758
                                                                  Page  1

          Date of Hearing:   April 14, 2004

                        ASSEMBLY COMMITTEE ON APPROPRIATIONS
                                   Judy Chu, Chair

                 AB 2758 (Berg) - As Introduced:  February 20, 2004 

          Policy Committee:                               
          UtilitiesVote:12-0 (Consent)

          Urgency:     No                   State Mandated Local Program:  
          No     Reimbursable:               

           SUMMARY  

          This bill extends, from 2006 to 2008, the sunset date for a  
          program administered by the Public Utilities Commission (PUC)  
          that provides grants for extending telecommunications  
          infrastructure to communities lacking telecommunication  
          services.

           FISCAL EFFECT  

          Potential special fund cost of up to $10 million in 2006 and in  
          2007 (California High-Cost Administrative Committee Fund-A and  
          Fund-B).

           COMMENTS  

           1)Background  . AB 140 Strom-Martin (Chapter 903, Statutes of  
            2001) created the Rural Telecommunication Infrastructure Grant  
            Program.  The program authorizes annual expenditures of up to  
            $10 million from either of two state programs that subsidize  
            the cost of telephone service-the California High-Cost Fund A  
            and California High-Cost Fund B.  These programs are funded by  
            a surcharge on telephone bills.  

           2)Purpose  .  According to a report prepared by the PUC pursuant  
            to the Supplemental Report of the 2002 Budget Act,  
            implementation of AB 140 was slowed due to the budget crisis.   
            Funding for the program's first year was eliminated in March  
            2002, and staff resources were reallocated to other active  
            areas.  When program funding was included in the proposed  
            budget for fiscal year 2003-04 staff resumed work on the  
            program. Currently, another round of statewide meetings are  








                                                                  AB 2758
                                                                  Page  2

            being conducted to inform interested parties of the grant  
            program and application process.  This bill extends the  
            program for an additional two years.

           Analysis Prepared by  :    Chuck Nicol / APPR. / (916) 319-2081