BILL ANALYSIS
SB 1712
Page 1
SENATE THIRD READING
SB 1712 (Polanco)
As Amended June 12, 2000
Majority vote
SENATE VOTE :30-3
UTILITIES & COMMERCE 10-0 APPROPRIATIONS 21-0
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|Ayes:|Wright, Pescetti, |Ayes:|Migden, Campbell, |
| |Calderon, Cardenas, | |Ackerman, Alquist, |
| |Frusetta, Maddox, | |Aroner, Ashburn, Brewer |
| |Mazzoni, Reyes, Vincent, | |Cedillo, Corbett, Davis, |
| |Wesson | |Kuehl, Maldonado, Papan, |
| | | |Romero, Runner, Shelley, |
| | | |Thomson, Wesson, Wiggins, |
| | | |Wright, Zettel |
|-----+--------------------------+-----+--------------------------|
| | | | |
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SUMMARY: Requires the California Public Utilities Commission
(CPUC) to study and report to the Legislature on whether the
definition of universal service should be broadened to include
video and data services. Specifically, this bill :
1)Requires CPUC, by February 1, 2001, to institute an order to
open a proceeding to examine and investigate the current and
future definitions of universal service.
2)Makes various findings and declarations concerning the
inclusion of two-way voice, video, and data service into
universal service.
3)Requires the proceeding to include public hearings and
encourage participation by numerous different interests,
including, but not limited to, consumer groups,
telecommunications providers, business and industry groups and
state and local agencies.
4)Defines the objectives of the study which include the
feasibility of redefining universal service to take into
consideration trends in convergence of voice, video, and data,
and technological changes that justify homogenization of
regulations and regulatory jurisdictions.
SB 1712
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5)Specifies that CPUC take into account that it does not
economically regulate many providers of voice, video, and data
services.
6)Specifies that recommendations made be consistent with Public
Utilities Code Section 709 and its assurances of universal
service commitment.
7)Requires CPUC to complete its investigation and report to the
Legislature by January 1, 2002.
EXISTING LAW requires CPUC to establish a class of lifeline
service necessary to meet minimum residential communications
needs and establish rates and charges for that service.
FISCAL EFFECT : CPUC indicates minor absorbable costs to
complete the study.
COMMENTS : According to the author, the purpose of this bill is
to require CPUC to review the existing definition of universal
service and consider whether it should be expanded to include
advanced voice, video and data services. He points out that
"advances in technology are bringing to the marketplace new
Internet accessing devices such as televisions, hand-held
computers and Internet phones."
A January 2000 report by the California Research Bureau (CRB),
"Profile of California Computer and Internet Users," estimates
that the information technology sector has contributed 35% of
the country's economic growth since 1998. The report goes on to
list the benefits of the information-technology innovation to
include increasing students' academic performance, expanding
individuals' ability to successfully participate in the labor
force, and expanding markets and increasing competition as
consumers use e-commerce. However, data provided in that same
report showed that, even though California is ahead of the
national average in percent of households with computers and
Internet access, only half of all Californians in 1998 had
computers at home and only 23.3% of the state's population
accessed the Internet. The report further showed that there are
significant gaps in terms of income levels, education, and
racial groups in computer ownership and Internet access. This
is commonly referred to as the "digital divide," the dichotomy
between those that have access to electronic technology and
SB 1712
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those that do not.
AB 3643 (Polanco), Chapter 278, Statutes of 1994, required CPUC
to open a proceeding to examine the current and future
definitions of universal service, and mandated that public
hearings be head so as to encourage participation from a broad
array of interests. Consequently, in 1996 CPUC issued Decision
96-10-066 (D. 96-10-066), which finalized its universal service
rules. D. 96-10-066 defines universal service as the concept
that basic service should be available to virtually everyone in
California at affordable rates. The decision defines basic
service as including 17 elements (i.e., the ability to place
calls, the ability to receive free unlimited incoming calls,
Lifeline, or discounted rates and charges for eligible
customers, and voice grade connection to public switched
telephone network). The definition of basic service does not
include access to video or data services.
Additionally, Chapter 278 called for a periodic review of the
basic service elements in order to insure that the definition is
kept current. D. 96-10-066 recommends CPUC undertake review of
the service elements three years after completion of an initial
review. This initial review consisted of the adoption of final
universal service rules in the proceeding. The triennial review
is scheduled for sometime this year. According to CPUC report
entitled "Universal Service Report to the Governor and the
Legislature," published December 1, 1999, the issues CPUC will
address is the definition of basic service, consistent with its
goals to provide for addition of new services to basic service
as new services become more widely used. CPUC intends on using
this bill as a vehicle for its review of basic service.
Analysis Prepared by : Jonathan Buttle / U. & C. / (916)
319-2083
FN: 0005531