CPUC Votes 5-0 to Consider Flat-Rate Intrastate USF
California Public Utilities Commissioners all OK'd a rulemaking asking if the state should switch to a connections-based USF contribution mechanism. Meeting virtually Thursday, they also all supported requiring open access for middle-mile infrastructure funded by the California Advanced Services Fund (CASF) and a $1.3 million fine for Frontier Communications for 2019 service-quality failures. Commissioner Darcie Houck, at her first CPUC meeting, supported all three items.
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The USF rulemaking will consider replacing the current 7.75% aggregate surcharge on intrastate revenue with a flat rate based on number of connections by Jan. 1 for California’s public purpose programs (see 2103010040). Comments are due in 30 days. “This truly is becoming a dire situation,” said CPUC President Marybel Batjer. She was troubled by the agency doubling surcharges last year for two programs and is most concerned now about the deaf and disabled program possibly becoming insolvent.
"We need to modernize our surcharge to keep up with the changing market, and it's critical we have a sustainable and predictable source of funding,” said Commissioner Cliff Rechtschaffen. Steady funding is critical as the CPUC tries to increase enrollment in the California LifeLine program, said Commissioner Genevieve Shiroma. Commissioner Martha Guzman Aceves said it’s “long-overdue reform,” and hopes the commission moves quickly to a proposed decision.
Cable said the CASF open-access mandate is unlawful, while public advocates said it would increase competition (see 2102230018). Nondiscriminatory access to middle-mile infrastructure “really has led to successful projects throughout the state,” said Guzman Aceves. The assigned commissioner for R.20-08-021, Guzman Aceves said the docket will be reassigned to Houck.
The CPUC plans to vote on Frontier’s bankruptcy reorganization at its next meeting March 18. Former Gov. Jerry Brown (D) urged the commission Wednesday to address internet problems in the decision. The CPUC proposed conditional OK of the deal (see 2102180031).
“I would recommend that you require the company 1) to improve bandwidth and 2) upgrade the switches located in the more remote areas,” Brown emailed commissioners and the service list for docket A.20-05-010. “Even within the cities and towns of Colusa County, internet service infrastructure is way below what it should be. Extensive upgrades are imperative.” The CPUC should monitor to ensure investments happen fast, he said.
Since moving to Colusa County in January 2019, Brown has “been able to get varying degrees of internet service from Frontier, with several outages along the way,” he said. “The local service technicians have been responsive and extremely helpful," and service "steadily improved" to 8.2 Mbps download and 0.62 Mbps upload, he said. "In the past, service was significantly less, with period outages.” But the county administrator and school officials told Brown that service is “way below adequate,” including hundreds of students with no internet connectivity, the former governor said: “This is an intolerable situation.”
“Frontier has made significant commitments to improve service and expand broadband services in its California service territory under the settlements reached with the parties participating in the proceeding," a spokesperson emailed. "Hundreds of thousands of households in communities across the state will ultimately benefit from these commitments with Frontier’s emergence from Chapter 11. Our focus is to continue working collaboratively toward a timely approval by the California PUC on March 18 so Frontier can successfully complete our restructuring."
Shiroma aides plan to virtually meet Frontier General Counsel Kevin Saville and other company officials Tuesday, said a company filing Thursday. The Utility Reform Network (TURN), CPUC Public Advocates Office (PAO), Communications Workers of America District 9, California Emerging Technology Fund (CETF) and Yurok Tribe plan to join, it said. They have Monday meetings with Batjer, Rechtschaffen and Guzman Aceves offices, similar Wednesday filings showed. TURN and PAO suggested technical edits to the proposed decision but otherwise supported conditional OK in Thursday comments. CETF urged quick approval.