AB470 - Telephone corporations: carriers of last resort.

Amended IN Senate July 17, 2025 Amended IN Assembly June 19, 2025 Amended IN Assembly May 05, 2025 Amended IN Assembly April 22, 2025 Amended IN Assembly March 17, 2025 CALIFORNIA LEGISLATURE— 2025–2026 REGULAR SESSION Assembly Bill No. 470 Introduced by Assembly Member McKinnor February 06, 2025 An act to add Article 1.5 (commencing with Section 2878) to Chapter 10 of Part 2 of Division 1 of the Public Utilities Code, relating to communications, and making an appropriation therefor. LEGISLATIVE COUNSEL'S DIGEST AB 470, as amended, McKinnor. Telephone corporations: carriers of last resort. Existing law vests the Public Utilities Commission with regulatory authority over public utilities, including telephone corporations. Existing law authorizes the commission to fix just and reasonable rates and charges for public utilities. Existing law requires the commission, on or before February 1, 1995, to issue an order initiating an investigation and open proceeding to examine the current and future definitions of universal service in telecommunications. Pursuant to that provision, the commission issued a decision involving carriers of last resort, including the withdrawal process for carriers of last resort, defined as a carrier who provides local exchange service and stands ready to provide basic service to any customer requesting basic service within a specified area. This bill would require the commission, in consultation with the Office of Emergency Services, to adopt a process through which a telephone corporation acting as a carrier of last resort is authorized to seek relief from their carrier of last resort obligations in a census block where the United States Census Bureau reports no population and where the telephone corporation provides no basic exchange service to any customer address located within the area, and in a census block that is well-served, as defined. The bill would require the commission, on or before December 15, 2026, to adopt a map designating well-served areas. The bill would require that the process include specified notice and challenge requirements. The bill would require a telephone corporation to meet certain requirements during specified time periods following the date that amended status is granted by the commission, as provided. The bill would create the Public Safety Agency Technology Upgrade Grant Fund, provide that moneys in the fund are continuously appropriated to the commission for purposes of public safety agency technology upgrade grants, and authorize the fund to accept donations from nongovernmental entities. The bill would exempt specified services and locations from its provisions. Existing constitutional provisions require that a statute that limits the right of access to the meetings of public bodies or the writings of public officials and agencies be adopted with findings demonstrating the interest protected by the limitation and the need for protecting that interest. This bill would make legislative findings to that effect. Under existing law, a violation of an order, decision, rule, direction, demand, or requirement of the commission is a crime. Because a violation of a commission action implementing this bill’s requirements would be a crime, the bill would impose a state-mandated local program. The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement. This bill would provide that no reimbursement is required by this act for a specified reason. Digest Key Vote: MAJORITY Appropriation: YES Fiscal Committee: YES Local Program: YES Bill Text The people of the State of California do enact as follows: SECTION 1. (a) The Legislature finds and declares all of the following: (1) The state encourages the deployment of advanced telecommunications capability to all Californians by utilizing regulatory forbearance measures that promote competition in the local telecommunications market, or other methods that encourage infrastructure investment. (2) All Californians deserve reliable, affordable, fast, and safe communication options, no matter who they are, where they live, or why they need to be connected. (3) The transition to advanced fiber optic networks is key to creating equity and positive impacts on California education, health care, agriculture, public safety, workforce development, and the economy. (4) Californians are moving swiftly to abandon the legacy network because it does not provide the benefits of modern communication technologies, with more choosing to use advanced services every year. (5) California must develop a responsible and equitable transition plan that ensures all Californians have access to the connectivity they need. (6) The transition should include a phased approach that over time ensures customers have access to communication services that are equally or more reliable and affordable, before transitioning away from the old legacy network. (7) As part of the transition, no Californian will be left without reliable voice service in their home, including the ability to contact 9-1-1. (8) The purposes of this act are to ensure California’s longstanding commitment to universal service is not compromised by changes to the telecommunications marketplace and to ensure the public may benefit from the transition away from legacy networks. To that end, this act establishes a comprehensive and robust process for a telephone corporation to seek changes to its obligations as a carrier of last resort for eligible areas only, and requirements to ensure the public benefits from those changes. (b) By choosing to enact legislation affecting a narrow scope of areas with robust competition or no direct impact to an existing population, it is the intent of the Legislature to allow the Public Utilities Commission to continue commission Rulemaking 24-06-012 (June 20, 2024), Order Instituting Rulemaking Proceeding to Consider Changes to the Commission’s Carrier of Last Resort Rules, for areas that are not eligible areas under this act. SEC. 2. Article 1.5 (commencing with Section 2878) is added to Chapter 10 of Part 2 of Division 1 of the Public Utilities Code, to read: Article 1.5. Carriers of Last Resort 2878. For purposes of this article, all of the following definitions apply: (a) (1) “Alternative voice basic service” means a retail service made available through a technology or service arrangement by a provider that provides, as a stand-alone service or as part of a bundled service, all of the following: (A) Voice access interconnected with the public switched telephone network. (B) Access to emergency 9-1-1 service and E-9-1-1 service in compliance with current state and federal laws and regulations. (C) Compatibility with a backup power source. (D) A billing option with monthly rates and without contract or early termination penalties. (E) Access to the California Relay Service pursuant to Section 2881 for deaf or hearing-impaired persons or individuals with speech disabilities. (F) Access to customer service for information about service termination, repair, and billing inquiries. (G) Free access to 800 and 8YY toll-free services with no additional usage charges for such calls. (2) “Alternative voice basic service” shall be a separate definition from “basic service,” as defined in commission Decision 12-12-038 (December 24, 2012), Order Instituting Rulemaking Regarding Revisions to the California High Cost Fund B Program, and does not encompass any obligations of any other service except as defined in this section. (b) “Amended status” means the status of a telephone corporation that has been granted relief from carrier of last resort status in a census block or census blocks. (c) “Amended status area” means a census block or census blocks for which a telephone corporation has been granted relief from carrier of last resort status. (d) “Broadband service” means a mass-market retail service by wire or radio provided to customers in the state that provides the capability to transmit data to, and receive data from, all or substantially all internet endpoints, including, but not limited to, any capabilities that are incidental to and enable the operation of the communications service, but excluding dial-up internet access service. (e) “Carrier of last resort” has the same meaning as defined in Section 275.6. (f) “Commitment letter” means an affidavit signed by an officer of a telephone corporation with legal authority to bind the telephone corporation to its obligations. (g) “Comparatively priced alternative voice basic service” means an alternative voice basic service that is competitively priced in relation to the relevant telephone corporation’s nondiscounted basic exchange telephone service when considering all the alternatives in the amended status area and the functionalities of the alternatives. (h) “Compliance” means following an applicable commission rule or order, corrective action plan, or other remedy, or completing a commission corrective action plan or other remedy, including payment of an applicable fine, for a census block subject to an application under this article. (i) “Eligible area” means a census block that is either of the following: (1) A census block that is well-served. (2) A census block where the United States Census Bureau reports no population and where a telephone corporation provides no basic exchange service to any customer address located within its telephone service territory. (j) “Eligible small business customer” means a traditional landline customer with five or fewer lines, that is not subject to a separate contract for copper-based voice services and fits the “microbusiness” definition in paragraph (2) of subdivision (d) of Section 14837 of the Government Code. (k) “Notice” means a written communication. (l) “Public safety agency technology upgrade grant” means a grant awarded to a law enforcement agency, as defined in Section 13670 of the Penal Code, for new technology, or an upgrade to existing copper-based systems, to transition to a modern communication system. (m) “Qualifying public assistance program” means any of the following programs: (1) The California Alternate Rates for Energy (CARE) program described in Section 739.1. (2) The State Supplementary Payment Program for the Aged, Blind and Disabled implemented pursuant to the Burton-Moscone-Bagley Citizens’ Income Security Act for Aged, Blind and Disabled Californians (Chapter 3 (commencing with Section 12000) of Part 3 of Division 9 of the Welfare and Institutions Code). (3) The Temporary Assistance for Needy Families program pursuant to Part A (commencing with Section 401) of Title IV of the federal Social Security Act (42 U.S.C. Sec. 601 et seq.). (4) The CalFresh program established pursuant to Chapter 10 (commencing with Section 18900) of Part 6 of Division 9 of the Welfare and Institutions Code. (5) Covered California, as described in Title 22 (commencing with Section 100500) of the Government Code. (6) Medi-Cal, as described in the Medi-Cal Act (Chapter 7 (commencing with Section 14000.4) of Part 3 of Division 9 of the Welfare and Institutions Code). (7) Supplemental security income benefits pursuant to Title XVI of the Social Security Act (Section 1381 of Title 42 of the United States Code). (n) “Small business security and alarm system technology migration assistance” means a voucher provided to an eligible small business customer for costs associated with transitioning alarm system services. (o) “Telephone corporation” has the same meaning as defined in Section 234. (p) “Well-served” means at least three different facilities-based service providers, not including the basic exchange offering over copper infrastructure from the telephone corporation that is acting as the carrier of last resort, offer alternative voice basic service in the relevant area, in compliance with commission rules developed and implemented pursuant to Section 776.2, and at least one of the service providers is a wireline provider, at least one two of the service providers offers a comparatively priced alternative voice basic service, offer alternative voice basic service at prices comparable to tariffed basic service, as confirmed by the commission, at least one of the service providers participates in the lifeline telephone service program pursuant to the Moore Universal Telephone Service Act (Article 8 (commencing with Section 871) of Chapter 4 of Part 1), and an alternative voice basic service is available to all of the broadband-serviceable locations in the area, as those broadband-serviceable locations are set forth in the most recent publicly available Federal Communications Commission National Broadband Map showing fixed and wireless broadband coverage. coverage or in other telephone, broadband, and wireless service data available to the commission. (q) “Voice over Internet Protocol” has the same meaning as defined in Section 239. 2878.1. (a) A telephone corporation that seeks to amend its status as a carrier of last resort under this article may submit a request to the commission for amended status in an eligible area, consistent with this article. (b) (1) Subject to this article and other conditions imposed by the commission consistent with this article, the commission shall approve approve, or amend and approve, a request for amended status from a telephone corporation. (2) Upon the commission approving a request for amended status from a telephone corporation pursuant to this article, the commission shall grant the telephone corporation relief from its carrier of last resort status and obligations within the amended status area, consistent with Sections 2878.2 and 2878.3. (c) In an existing proceeding, the commission shall, on or before December 15, 2026, adopt a map designating well-served areas. The map adopted by the commission shall include data from the wireless coverage maps adopted pursuant to commission Rulemaking 23-02-016 (March 1, 2023), Order Instituting Rulemaking Proceeding to Consider Rules to Implement the Broadband Equity, Access, and Deployment Program, or from the Federal Communications Commission’s National Broadband Map. Map, or from other telephone, broadband, and wireless service data available to the commission. (d) A telephone corporation shall be in compliance with General Order 133-E, Rules Governing Telecommunications Services, or a successor to that general order adopted by the commission, for the preceding 12 months in order to be eligible to request amended status. 2878.2. (a) In an existing proceeding, the commission shall, in consultation with the Office of Emergency Services, on or before December 15, 2026, adopt a process through which a telephone corporation seeking to amend its status as a carrier of last resort under this article may submit to the commission a request for amended status for [Text truncated for display. Full text available on Congress.gov.]