BILL ANALYSIS 1
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SENATE ENERGY, UTILITIES AND COMMUNICATIONS COMMITTEE
MARTHA M. ESCUTIA, CHAIRWOMAN
AB 1206 - J. Horton Hearing
Date: September 7, 2005 A
As Amended: September 2, 2005 FISCAL B
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DESCRIPTION
Current law requires the California Public Utilities Commission
(CPUC), before creating a new area code, to perform a telephone
number utilization study and implement all reasonable telephone
number conservation measures.
This bill requires that the telephone number utilization study be
performed within 18 months of the approval of the new area code.
This bill applies these provisions to any pending area code
decision that has not been fully implemented as of January 1,
2006. This includes the recently approved 310 area code decision.
BACKGROUND
Area Codes: Splits versus Overlays
Demand for telephone numbers increased dramatically in the mid- to
late 1990's because of the increased competition resulting from
deregulation of telecommunications markets and an explosion of new
services, such as cellphones, pages, and fax machines, each
requiring its own telephone number. As telephone numbers are
consumed, new telephone numbers must be created. This is
accomplished by creating new area codes. The high demand for new
telephone numbers caused the number of area codes in California to
nearly double in the 1990's.
Area codes can be created in two ways. The traditional way is to
split an area code in two. About half the customers retain their
existing area code, and for them the area code split means no
change. The other customers receive the new area code, and for
them the area code means reprogramming speed dialers, printing new
stationery and business cards, and alerting contacts of the new
telephone number. The second way to create a new area code is to
overlay upon it a second area code. That overlay area code can
have the same geographic boundaries as the underlying area code,
but that is not required. The advantage of an overlay area code
is that no customer has to change their number. The disadvantages
are that all calls made from the overlay and underlying area codes
must be dialed using 11 digits, per CPUC and Federal
Communications Commission (FCC) rules. Also, a customer with
multiple telephone numbers may have different area codes for those
numbers. A relatively new creation, 23 overlay area codes have
been established in 14 states.
Once an area code is created, state law requires a substantial
transition period to educate customers on the new dialing
requirements and to allow customers to make the necessary changes
to their equipment and stationery. This is typically twelve
months.
The Recent History of the 310
In January 1997 the 310 area code was split, forming a separate
562 area code. Four months later telephone companies notified
customers of the need for another new area code in the 310. In
May 1998 the CPUC approved a new overlay area code for the 310.
The 310 community raised concerns over the need for creating yet
another new area code and the wisdom of an overlay area code. In
September 1999 the CPUC suspended the new overlay area code,
believing that the life of the 310 could be extended through more
efficient utilization of telephone numbers. In December 2000 the
CPUC reversed itself and rejected the overlay area code in favor
of splitting the 310 whenever the new area code is needed. In
August 2005 the CPUC reversed itself again, deciding to create an
overlay area code, the first in California. The CPUC also
determined that it was timely to create a new 424 area code
overlaying the 310 effective August 2006.
COMMENTS
1. Is the 310 Exhausted? - The provisions in this bill,
requiring a timely telephone utilization study, ensuring that
all telephone number conservation measures have been
implemented, keeping current with existing law, should not be
controversial. The key question in this bill is whether
implementation of this bill will cause a telephone number
shortage. This could happen if telephone number usage rates
exceed the supply of 310 telephone numbers available.
To understand whether this could happen requires delving a
little deeper into how telephone numbers are handed out.
Telephone numbers are provided to telephone companies in
blocks of one-thousand continuous numbers (i.e. 310 525-1000
through 310 525-1999). Those thousand number blocks are each
assigned to subunits of the area code, known as rate centers.
Within the 310 there are 16 rate centers. The CPUC decision
indicates that there exist 267 thousand number blocks within
the 310, and that 26 of these blocks are handed out each
month. That means that a little over 10 months of numbers
remain. But those 267 thousand number blocks aren't evenly
distributed among rate centers. For example, the El
Segundo rate center has 44 blocks available while the
Torrance rate center has none and the West Los Angeles rate
center has one.
While there are few thousand number blocks available to give
out in some rate centers, a number shortage won't appear
until the telephone companies run out of numbers within those
blocks. The purpose of the telephone number utilization
study is to get a handle on the rate of usage and the
remaining inventory of the telephone companies. Without
timely data the CPUC cannot know when an area code must be
created.
2. Timely Data - The CPUC's 310 decision is not clear on the
timeliness of the data upon which it relies. Further inquiry
indicates that the CPUC performed its telephone number
utilization study on the 310 in 2000. However, since then
the CPUC has relied on analyses provided by the North
American Numbering Plan Administration (NANPA), an
organization established by the FCC. The NANPA requires
telephone companies to report on their number utilization
every 6 months. The CPUC in its decision relied on NANPA
data that was current as of July 2005. More recent data show
that the number of available thousand number blocks has
declined from 267 to 192. While this data is unaudited,
false statements are subject to fine or imprisonment. And
this data seems to indicate that without a new area code the
310 may very soon run out of available numbers.
3. Late FCC Action - Responding to a CPUC petition required
by California law, the FCC partially granted authority for
the CPUC to impose an overlay for non-geographically based
numbers, such as VOIP, ATM, and fax numbers. The FCC noted
this grant of authority the day before the CPUC decision via
a press release without issuing the actual order, as is their
custom. In voting on their decision the CPUC took note of
the FCC's press release but voted out the 424 overlay
decision, apparently without further inquiry of the FCC. As
of September 6, the FCC's final order is not available.
4. No Amendments - Pursuant to Senate rule 29.10, this bill
cannot be amended in committee.
ASSEMBLY VOTES
Senate Public Employment and Retirement (3-2)*
Assembly Floor (52-24)*
Assembly Appropriations Committee (13-5)*
Assembly Public Employees, Retirement and Social Security
(4-2)*
*Votes on a prior unrelated version of the bill
POSITIONS
Support:
None on file
Oppose:
California Cable Television Association
Cingular
CTIA, The Wireless Association
SBC
Sprint-Nextel
T-Mobile
Verizon Communications
Verizon Wireless
Randy Chinn
AB 1206 Analysis
Hearing Date: September 7, 2005