Senate Bill 740 (Padilla, D -Pacoima), which proposes to add $90 million to the California Advanced Services Fund (CASF) and expand eligibility beyond telephone companies and wireless licensees of the California Public Utilities Commission (CPUC) for broadband providers to serve Californians across the state, has cleared a major hurdle this week. On Monday, the Assembly Utilities and Commerce (U&C) Committee heard the bill on a motion of reconsideration, and passed it by a vote of 11-4 after the cable industry withdrew opposition to the measure.
After failing passage on July 1st by a vote of 5-3-7, SB740 now goes on to the Assembly Appropriations Committee, where it will be heard in the next few weeks.
Supporting the measure this week were Assembly members Bonilla, Bradford, Brown, Buchanan, Fong, Garcia, Gorell, Roger Hernandez, Quirk, Rendon and Skinner. Assembly members Chavez, Beth Gaines, Jones and Patterson opposed the bill.
The California Cable & Telecommunications Association (CCTA) had objected to the expansion of eligibility for CASF grants for any entity that is not a telephone corporation that may seek to provide a competitive but subsidized broadband service in areas that are currently served by an existing broadband provider, according to committee documents. The author’s amendments authorize entities that are not telephone corporations to provide access to broadband to an unserved or underserved household as defined by the CPUC. CCTA also objected to the expansion of eligibility for CASF funds to local governments.
"There have been cases when local governments deploy broadband systems to compete with the existing providers of broadband services in order to achieve financial gain. The new language prioritizes and targets funding for households and communities that have no broadband services, guarantees existing providers the option to upgrade service before a new entity receives funding,” stated a committee staff analysis on the measure. “SB740 amendments also require the PUC review of actual levels of existing broadband service before funding is awarded." CCTA removed its opposition to the bill after the amendments by the author, Senator Alex Padilla, were published last week.
Assembly member Roger Hernandez praised the amendments which fixed what he thought were "unintended consequences" of the original bill. He approved of the new right of refusal and clarifications on when a local government can apply for CASF funds from the CPUC.
Assembly U&C Chairman Bradford, who presented the bill for reconsideration for the author, noted the progress made on the bill to clarify the definitions of unserved and underserved areas and issues relating to "overbuilds." He made the point that "the digital divide is more than just not having a computer or Internet in the home, but accessing many of those life resources like continuing education, seeking employment and keeping in touch with family and friends" which includes rural and urban areas.
The assembly committee hearing was filled with broadband advocates, particularly rural broadband representatives who believe that their areas have suffered market failure for critical broadband services of sufficient speed for economic development and socio-economic benefits to their communities. They have complained that mapping data submitted to the Federal Communications Commission and the CPUC by existing broadband providers is inaccurate as to their rural areas.
Paul Smith with Rural Counties Association testified that while not a perfect compromise, the amendments did allow the CASF to get new funds for rural California for broadband deployment, and he supported it.
Among those speaking in support of the Assembly bill were representatives of Mayor Ed Lee, the City and County of San Francisco, Sonoma County Supervisors, CPUC, Non-Profit Housing Association of Northern California, California Center for Rural Policy, Gold Country Broadband Consortia, Southern California Tribal Chairman/Tribal Digital Village, Access Humboldt, Connected Capital Area Broadband Consortia, Los Angeles Regional Broadband Consortia, Central West, and Central Coast Broadband Consortium.
Should SB740 pass, it will provide funding for AB1299 (Bradford 2013) to go forward. AB1299 authorizes the CPUC to award CASF grants "to encourage deployment and adoption of high–quality advanced communications services" for those who reside in publicly supported housing communities in urban regions. AB1299 passed out of the Senate Energy, Utilities and Communications Committee on July 2nd, and was put on suspense in the Senate Appropriations Committee yesterday, after being presented by the Chairman. Support was put in the record and no opposition recorded. The Senate Appropriations Committee will take up items on suspense near the end of this month.
