BILL NUMBER: SB 1276 AMENDED
BILL TEXT
AMENDED IN SENATE APRIL 1, 2004
INTRODUCED BY Senator Bowen
FEBRUARY 13, 2004
An act to amend Section 874 739.3 of
the Public Utilities Code, relating to telecommunications.
LEGISLATIVE COUNSEL'S DIGEST
SB 1276, as amended, Bowen. Telecommunications:
lifeline telephone service rates.
Under existing law, the Public Utilities Commission has regulatory
authority over public utilities, including telephone corporations,
and authorizes the commission to fix just and reasonable rates and
charges. Existing law, until January 1, 2005, requires the
commission to develop, implement, and maintain a program to establish
a fair and equitable local rate structure designed to reduce any
disparity in rates charged by small independent telephone
corporations serving rural and small metropolitan areas, and a
competitively neutral, and broadbased program to provide for transfer
payments to telephone corporations serving areas where the cost of
providing services exceeds rates charged by providers, as determined
by the commission. Pursuant to this requirement, the commission has
imposed a surcharge to intrastate telephone service to fund the
transfer payments.
This bill would extend this program until January 1, 2009. By
extending the program, the bill would result in a change in state
taxes for the purpose of increasing state revenues within the meaning
of Section 3 of Article XIII A of the California Constitution, and
thus would require for passage the approval of 2/3 of the membership
of each house of the Legislature.
The Moore Universal Telephone Service Act established the
Universal Lifeline Telephone Service (ULTS) program in order to
provide low-income households with access to affordable basic
residential telephone service. ULTS rates are required to be set at
no more than 50% of either the basic rate for measured service or the
basic flat rate service, as applicable, exclusive of federally
mandated end user access charges, that are available to the
residential subscriber.
This bill would specify that ULTS rates are required to be set at
no more than 50% of the basic rate for measured service or the basic
flat rate service, as applicable, exclusive of federally mandated end
user access charges, that are available to the residential
subscriber from the telephone corporation offering the service.
Vote: majority 2/3 . Appropriation:
no. Fiscal committee: no yes .
State-mandated local program: no.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. Section 874 739.3 of the
Public Utilities Code is amended to read:
874. The lifeline telephone service rates and charges shall be
739.3. (a) The commission shall develop, implement, and maintain
a suitable program to establish a fair and equitable local rate
structure aided by transfer payments to small independent telephone
corporations serving rural and small metropolitan areas. The purpose
of the program shall be to promote the goals of universal telephone
service and to reduce any disparity in the rates charged by those
companies.
(b) For purposes of this section, small independent telephone
corporations means those independent telephone corporations serving
rural areas, as determined by the commission.
(c) The commission shall develop, implement, and maintain a
suitable, competitively neutral, and broadbased program to establish
a fair and equitable local rate support structure aided by transfer
payments to telephone corporations serving areas where the cost of
providing services exceeds rates charged by providers, as determined
by the commission. The commission shall develop and implement the
program on or before October 1, 1996. The purpose of the program
shall be to promote the goals of universal telephone service and to
reduce any disparity in the rates charged by those companies. The
commission shall structure the program required by this subdivision
so that the amount of each transfer payment reasonably equals the
value of the benefits of universal service to the transferor entity
and its subscribers. Except as otherwise explicitly provided, this
subdivision does not limit the manner in which the commission
collects and disburses funds, and does not limit the manner in which
it may include or exclude the revenue of transferring entities in
structuring the program.
(d) The commission shall investigate subsidy reduction, or
elimination of subsidies in service areas with demonstrated
competition.
(e) Not later than February 1, 2001, the Legislative Analyst shall
conduct a review of the state's universal telephone service program,
including subsequent modifications as appropriate, and report to the
Governor and the Legislature as part of the Legislative Analyst's
analysis of the Budget Bill to be issued in February 2001. In
evaluating the program, the Legislative Analyst shall consider all of
the following:
(1) The findings of the report required by subdivision (e).
(2) An assessment of whether any identified problems are issues
that affect the continued implementation of this chapter or issues
that warrant revisions of statutes or regulations.
(f) This section shall remain in effect until January 1,
2005 2009 , and as of that date is repealed,
unless a later enacted statute , which that
becomes effective on or before January 1, 2005
2009 , deletes or extends that date.
as follows:
(a) In a residential subscriber's service area where measured
service is not available, the lifeline telephone service rates shall
not be more than 50 percent of the rates for basic flat rate service,
exclusive of federally mandated end user access charges, available
to the residential subscriber from the telephone corporation offering
the service.
(b) In a residential subscriber's service area where measured
service is available, the subscriber may elect either of the
following:
(1) A lifeline telephone service measured rate of not more than 50
percent of the basic rate for measured service, exclusive of
federally mandated end user access charges, available to the
residential subscriber from the telephone corporation offering the
service.
(2) A lifeline flat rate of not more than 50 percent of the rates
for basic flat rate service, exclusive of federally mandated end user
access charges, available to the residential subscriber from the
telephone corporation offering the service.
(c) The lifeline telephone service installation or connection
charge, or both, shall not be more than 50 percent of the charge for
basic residential service installation or connection, or both. The
commission may limit the number of installation and connection
charges, or both, that may be incurred at the reduced rate in any
given period.
(d) There shall be no charge to the residential customer who has
filed a valid eligibility statement for changing out of lifeline
service.
(e) The commission shall assess whether there is a problem with
customers who fraudulently obtain lifeline telephone service. If the
commission determines that there is a problem, it shall recommend
and promulgate appropriate solutions. This assessment and the
solutions determined by the commission shall not, in and of
themselves, change the procedures developed pursuant to Section 876.