BILL ANALYSIS 1
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SENATE ENERGY, UTILITIES AND COMMUNICATIONS COMMITTEE
DEBRA BOWEN, CHAIRWOMAN
AB 818 - Knox Hearing Date: July 13, 1999
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As Amended: June 15 , 1999 FISCAL/URGENCY
B
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DESCRIPTION
Current federal regulations require telephone numbers to be
handed out in a certain manner and preclude states from
assigning area codes and prefixes based on a
technologically specific use.
Current state law prescribes a process for soliciting and
accepting public input regarding the creation of new area
codes and for implementing a new area code once a
determination has been made that a new area code is
necessary.
This bill makes legislative findings about area code
proliferation and its detrimental effect on society,
declares that area codes should be preserved for as long as
possible and calls on the California Public Utilities
Commission (CPUC) to stop area code proliferation.
This bill requires the CPUC to develop and implement any
available measures which efficiently allocate telephone
numbers.
This bill requires the CPUC to ask the Federal
Communications Commission (FCC) to delegate to the state
the authority allow the CPUC to implement telephone number
conservation measures.
This bill requires the CPUC to obtain the number of
telephone numbers in the possession of, and used by,
telephone companies and attempts to compel telephone
companies to cooperate. Using this information, the CPUC
is required to submit to the Legislature a study of
telephone number use rates by July 1, 2001. Until the
study is completed, this bill requires the PUC to suspend
10-digit dialing within the 310 area code.
This bill requires the CPUC to require telephone companies,
if possible, to assign numbers to their customers from
prefixes which are more than 25% in use.
This bill requires that if the CPUC or an authorized
federal agency establishes a process which permits the
allocation of fewer than 10,000 numbers, that the CPUC
shall require telephone companies to return their unused
blocks of numbers.
KEY QUESTIONS
1.What effect will barring the use of 10-digit dialing
(also known as 11-digit dialing if you count the "1") in
the 310 area code until July 1, 2001 have on people and
businesses in need of phone numbers?
2.What will be the effect of passing a law that contradicts
federal regulations that mandate 10-digit dialing in
areas where an area code overlay has been ordered?
3.Is the bill's requirement that the CPUC implement any
measure that more efficiently allocates telephone numbers
an overly broad requirement that could inadvertently
hurt, rather than help, consumers?
4.Should the provision of the bill requiring the CPUC to
study number conservation strategies be expanded to
consider more options rather than the narrow list
delineated in the bill?
5.Should the requirement that the CPUC ask the FCC to
delegate certain powers to the states be deleted from
this bill, since the CPUC has already taken this action?
BACKGROUND
Coming Soon: Your Own Personal Area Code . After starting
with three area codes in 1947, California had 13 area codes
in 1992, which mushroomed into 23 area codes by the end of
1998. At the current pace, the CPUC expects California to
have 41 area codes by the end of 2002. The Los Angeles
area has been at the leading edge of area code expansion,
with the number of area codes tripling since the early
1980's. The San Francisco Bay Area is not far behind - it
has four new area codes set to take effect by the end of
next year.
The growth of area codes have a number of practical
implications in people's every day lives as phone users are
forced to adapt to new dialing habits, re-program their
telephone devices, dial more calls using 11 digits rather
than the traditional 7, and more. Businesses are often
forced to change stationery and advertisements, as well as
lose any "equity" they may have built up with their
long-standing telephone numbers.
Reasons Behind The Area Code Explosion . The growth in the
demand for new area codes can be attributed to three basic
realities:
First, deregulation and the emergence of new telephone
companies has dramatically increased the demand for new
telephone numbers, as these new companies all need their
own numbers to sell to customers. For example, in the
early 1980's there were only a handful of telephone
companies needing telephone numbers in the 310 area code.
Now, 53 telephone companies have the right to demand an
allocation of telephone numbers in the 310 area code alone.
Second, technology has made new forms of communications
available and affordable to people and businesses. Most
people no longer have just one home number and one work
number - they have numbers dedicated for pagers, cellular
telephones, internet service, and fax machines.
Furthermore, the "point of sale" credit card verification
terminals that have popped up at grocery stores, gas
stations, and other merchants all require their own phone
lines.
Third, the FCC regulations on how telephone numbers are
handed out to companies haven't kept up with deregulation
or technology. For example, the FCC only allows numbers to
be handed out in blocks of 10,000 - even if a telephone
company only has a single customer. So, as a result of the
emergence of new telephone competitors, more blocks of
10,000 numbers are being handed out (thus draining the pool
of available numbers more quickly), and as a result of
people's use of new technologies that require dedicated
phone numbers, the numbers within those blocks are being
exhausted more rapidly (based on how the FCC determines
that block of numbers has been exhausted).
The Long Arm Of The Law . California is not free to deal
with telephone numbers in any way it sees fit because
Congress has given the FCC the responsibility for telephone
number administration. Consequently, the FCC has limited
the states' discretion when it comes to dealing with
telephone numbering issues.
For example, the FCC prevents states from allocating
telephone numbers on the basis of technology (i.e. separate
area codes for cellular telephones and pagers). It also
prevents states from imposing telephone number conservation
measures designed to slow the need for new area codes.
California is not alone in its frustration with its
inability to deal with area code issues as it would like -
New York, Florida, Illinois, North Carolina, Colorado,
Maine, and Pennsylvania have also complained to the FCC
about their inability to deal with the area code
proliferation problem.
Responding to widespread public concern, including requests
from the Chair of this committee, the author of AB 818, the
CPUC and other states, the FCC announced on May 27 that it
will examine proposals to allow states to use telephone
numbers more efficiently. In its announcement, the FCC
noted that "frequent area code changes are frustrating,
inconvenient, and costly to consumers and industry, and
burdensome to communities." While this FCC proposal is
encouraging, it's unlikely to be enacted soon enough to
provide meaningful relief to Californians who are facing
the imminent imposition of a new area code split or
overlay, such as in the 310 area code.
Overlay vs. Split . In addition to the proliferation of new
area codes, a second controversy was created when the CPUC
decided to create a new area code in the 310 area code
territory by imposing the state's first "area code
overlay."
Historically, new area codes have been created by
geographically splitting existing area codes, which forces
people and businesses located in the "new" area to get new
telephone numbers. This is obviously inconvenient for
people and businesses that have to re-program machines, let
their friends or customers know about the new number and,
in the case of a business, reprint stationery, change
advertisements, and much more.
A long-discussed alternative way of creating a new area
code is the "overlay," where a second area code is laid on
top of an existing area code. The main advantage of an
overlay is no one is required to change their existing
telephone or fax numbers - only people getting new numbers
would receive the new area code even though they'd
physically be located in the "old" area code territory.
The primary downside is that everyone has to dial eleven
digits (1 + area code + phone number) on all telephone
calls - even when calling a person in the same area code.
More fundamentally objectionable to many people is that in
an overlay, a person could have two different area codes in
their own home, which goes against the entire concept of
what everyone understands an "area code" to be.
COMMENTS
1.Data, Data, We Need Data . Several of the provisions of
this bill clearly enhance the state's ability to deal
with the area code proliferation problem. The gathering
of data (Section 5 and 8) and establishment of number
utilization standards (Sections 6 and 7) are specific
examples of steps the bill requires the CPUC to take that
will no doubt be valuable.
2.Is There A Devil We Don't Know? Section 3 of the bill
requires the CPUC to develop and implement any measures
to efficiently allocate telephone numbers. It is clearly
in the public's - and government's - best interest to
allocate telephone numbers efficiently, but it's
questionable whether the CPUC should be required to
implement any number-saving ideas, regardless of how
unproven they may be, how much they may cost consumers,
what technical and practical complications they may
create, how they may interact with future (and requested)
FCC regulatory changes, and whether they may be
inconvenient to telephone users even though they may be
"efficient."
As such, the author and Committee may wish to consider
amending this section to require the CPUC to consider the
cost to consumers of any number-saving proposal and
consider each proposal in the context of California's
telecommunications system and what many hope will be FCC
regulatory changes. This amendment should be accompanied
by an amendment to the legislative intent language in
Section 2 to state that while efficient number allocation
is a priority, it must be considered in light of the
above-noted factors.
3.As Long As The CPUC Is At It . . . While Section 3
generally requires the CPUC to look at number
conservation strategies, it would be helpful to
specifically require the CPUC to look at two potentially
promising ideas.
The first is the notion of "rate center consolidation,"
which reduces the number of prefixes that a telephone
company needs to serve a given service area. One of the
effects of this could be to turn what have been "toll"
calls within the same area code into "local" calls
covered by the base rate that a person pays for telephone
service, which may in turn trigger local phone companies
to petition the CPUC for an increase in the base rate
they're allowed to charge.
The second, which was deleted in the June 15 amendments
to the bill, is "unassigned number porting," which
provides for the more efficient use of telephone numbers
by requiring unused telephone numbers to be shared with
or given to other providers. The "losers" under
unassigned number porting are likely to be telephone
companies that have large supplies of unused numbers
which they currently aren't required to disclose or turn
over for reassignment.
If the goal of this section of the bill is to require the
CPUC to examine all the options for making more efficient
use of telephone numbers, the author and Committee may
wish to consider amending these provisions into the bill
to ensure the CPUC reviews their cost, technological, and
practical impacts.
4.Turn Back The Clock . Section 5 of the bill immediately
requires the PUC to suspend the 10-digit dialing
requirement in the 310 area code until the CPUC finishes
its telephone number efficiency study (which is due by
July 1, 2001).
While the new 424 area code has yet to be overlayed into
the 310 area, residents have been required to dial
10-digits (also referred to as 11-digit dialing by those
who count the need to also dial a "1") since April 17 in
an attempt to try and get people "in the habit" of
dialing 11 digits. This move by the CPUC triggered
dozens of calls, letters, and e-mails to the Committee
from people frustrated with having to dial 11 digits on
every call they make, even one to a family member who has
a different phone number but lives in the same house.
The appeal of suspending the 10-digit dialing requirement
until July 1, 2001 is obvious, but the author and
Committee may wish to consider a number of practical
questions such a proposal raises before deciding whether
to adopt it:
q The FCC mandates 10-digit dialing in areas where an
area code overlay has been implemented. The rationale
is that incumbent companies serving the existing area
code shouldn't have an "advantage" (allowing people to
continue to dial 7 digits) over companies that have to
hand out numbers in the new area code that require
users to dial 11 digits in order to dial into the old
area code. What will be the impact if California
creates a law that so clearly violates FCC
regulations? The author and Committee may wish to
consider amending the bill to make the suspension of
the 10-digit requirement contingent upon a decision by
the CPUC to reverse the overlay in the 310 area code.
q On June 24, the CPUC temporarily suspended the
implementation of the 424 area code, but it did not
reverse the overlay. If the 10-digit dialing
requirement is reversed by this bill to allow people
to revert to 7-digit dialing and the CPUC does not
reverse the overly and eventually implements the 424
overlay (which was originally scheduled to take effect
on July 17), everyone will be required to switch back
to 10-digit dialing. Will this switch from having to
dial 7 numbers, then 10, then 7, then 10 numbers again
cause additional consumer confusion and/or
frustration, especially for those who will have to
reprogram their fax machines, computer modems,
automatic gates, etc. with each switch?
q If the 10-digit dialing requirement is reversed
until July 1, 2001 as this bill proposes and the CPUC
is correct in its assessment that the supply of
numbers in the 310 area code will be exhausted by late
1999, what happens? Will people and businesses who
want to establish service and get phone numbers in the
310 area code be unable to do so? Or will this
effectively force the CPUC to implement a more
traditional area code split in the 310 region? Prior
to adopting the overlay concept in May 1998, the split
proposal entertained by the CPUC would have roughly
allowed those north of Los Angeles International
Airport (Santa Monica, Venice, etc.) to keep their
310 area code numbers while forcing those south of the
airport (Torrance, Manhattan Beach, Carson, etc.) to
move into the new 424 area code.
While this bill only applies to 10-digit dialing in the
310 area code, absent FCC action in the very near future
this is probably not the last time the issue of the area
code overlay will come before the Committee. The CPUC
has already approved overlay plans to take effect in the
408 (scheduled for October 1999), 510 (April 2000), 650
(June 2000), and 415 (July 2000) area codes, and it's
currently trying to answer the "split or overlay"
question in the 707 and 818 area codes.
With that in mind, the Committee may wish to think about
how best to deal with the concept of the area code
overlay in the broader context. Should the Committee
only deal with it as it applies to the 310 area code, as
this bill proposes, and simply gamble that the FCC will
give California the authority to hand out numbers in
smaller blocks and do technology overlays, thus reducing
the need for area code overlays and/or splits in the
future? Or should the Committee take this opportunity to
simply preclude the CPUC from using area code overlays
anywhere in California, thus forcing it to rely on the
traditional area code split until such time that the FCC
gives the state control over its numbers, which will
minimize the necessity of any future area code changes?
1.No Dessert Until You Finish What's On Your Plate . Within
each area code there are 790 prefixes and 7.9 million
telephone numbers within each area code. Section 6 of the
bill requires the CPUC to develop a procedure to require
telephone companies to hand out telephone numbers only
from prefixes which have more than 25% of the numbers in
use.
The goal is to force companies to use up telephone
numbers in partially used prefixes before they begin
handing out numbers in sparsely used prefixes. This
provision will be useful if the CPUC is given the
authority to allocate numbers in blocks of 1,000 rather
than 10,000 because it will prevent telephone companies
from inefficiently using numbers in all blocks of 1,000.
2.Do We Have To Do It Again? The author and Committee may
wish to delete Section 4 of the bill, which requires the
CPUC to make a specified filing before the FCC. While
this section may have been appropriate at one time, the
CPUC made such filing on April 23 of this year, rendering
the section unnecessary.
3.Technically Speaking . The author may wish to accept the
following technical amendment: On Page 5, Line 20, the
reference should be to the Public Utilities Code, not the
Public Resources Code.
ASSEMBLY VOTES
Assembly U & C Committee (11-0)
Assembly Appropriations Committee (21-0)
Assembly Floor (70-6)
POSITIONS
Support:
City of Camarillo
City of Culver City
City of Los Angeles
Los Angeles County Board of Supervisors
Office of Ratepayer Advocates (ORA)
Santa Barbara City Council
Santa Monica City Council
Numerous Individuals
Oppose:
California Cable Television Association (Oppose unless
amended)
Cellular Carriers Association of California (CCAC)
GTE
MCI WorldCom
Professor Bill Neill, Ret., San Diego
Pacific Bell
PUC
Randy Chinn
AB 818 Analysis
Hearing Date: July 13, 1999