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AB-1257 Small independent telephone corporations: ratemaking.(2021-2022)

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Date Published: 02/19/2021 09:00 PM
AB1257:v99#DOCUMENT


CALIFORNIA LEGISLATURE— 2021–2022 REGULAR SESSION

Assembly Bill
No. 1257

Introduced by Assembly Member Patterson

February 19, 2021

An act to add Section 275.7 to the Public Utilities Code, relating to telecommunications.


LEGISLATIVE COUNSEL'S DIGEST


AB 1257, as introduced, Patterson. Small independent telephone corporations: ratemaking.
Under existing law, the Public Utilities Commission has regulatory authority over public utilities, including telephone corporations, and can establish its own procedures, subject to statutory limitations or directions and constitutional requirements of due process. Existing law authorizes the commission to fix the rates and charges for every public utility and requires that those rates and charges be just and reasonable. Existing law requires the commission to exercise its regulatory authority to maintain the California High-Cost Fund-A program to provide universal service rate support to small independent telephone corporations, as defined, in amounts sufficient to meet the revenue requirements established by the commission through rate-of-return regulation in furtherance of the state’s universal service commitment to the continued affordability and widespread availability of safe, reliable, high-quality communications services in rural areas of the state.
This bill would state the intent of the Legislature that the commission adopt procedures to increase the efficiency of its ratemaking processes for small independent telephone corporations and allow, wherever reasonably possible, a small independent telephone corporation to request adjustments to its revenue requirement or rate design through either an advice letter or an application process. If a rate case is submitted by application by a small independent telephone corporation, the bill would require the parties to that rate case to participate in at least one day of facilitated mediation with a neutral administrative law judge pursuant to the commission’s alternative dispute resolution program. The bill would require a moving party, before filing a motion in a small independent telephone corporation’s rate case, to meet and confer in a good faith effort with all other parties to informally resolve the subject of the motion, and require that all motions include facts demonstrating the moving party’s good faith effort to meet and confer before filing the motion.
Under existing law, a violation of the Public Utilities Act or any order, decision, rule, direction, demand, or requirement of the commission is a crime.
Because the provisions of this bill would be a part of the act and because a violation of an order or decision of the commission implementing its requirements would be a crime, the bill would impose a state-mandated local program by creating a new crime.
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.
Vote: MAJORITY   Appropriation: NO   Fiscal Committee: YES   Local Program: YES  

The people of the State of California do enact as follows:


SECTION 1.

 (a) The Legislature finds and declares all of the following:
(1) California’s small independent telephone corporations, serving the most rural and hard to reach areas of the state, play an important role in ensuring all Californians have access to telecommunications services.
(2) These small independent telephone corporations help bridge the digital divide, thereby facilitating access to economic prosperity, health care, education, and the world for the rural communities they serve.
(3) California’s small independent telephone corporations have ensured connectivity for their customers during the COVID-19 pandemic.
(b) It is the intent of the Legislature that the Public Utilities Commission work diligently to streamline the process for small independent telephone corporations’ rate cases, making the process less cumbersome and less time consuming, thereby decreasing the regulatory burden on these companies and allowing them to continue serving their communities and territories without interruption.

SEC. 2.

 Section 275.7 is added to the Public Utilities Code, to read:

275.7.
 (a) For purposes of this section, “small independent telephone corporation” has the same meaning as defined in Section 275.6.
(b) It is the intent of the Legislature that the commission adopt procedures to increase the efficiency of its ratemaking processes for small independent telephone corporations and to allow, wherever reasonably possible, a small independent telephone corporation to request adjustments to its revenue requirement or rate design through either an advice letter or an application process.
(c) If a rate case is submitted by application by a small independent telephone corporation, the commission shall require the parties to participate in at least one day of facilitated mediation with a neutral administrative law judge pursuant to the commission’s alternative dispute resolution program. The mediation shall take place at least 30 days before the commencement of hearings and mediation shall be included as an event in the scoping memo for the proceeding.
(d) Before filing any motion in a small independent telephone corporation’s rate case, the moving party shall meet and confer in a good faith effort with all other parties to informally resolve the subject of the motion. All motions shall include facts demonstrating the moving party’s good faith effort to meet and confer before filing the motion.

SEC. 3.

 No reimbursement is required by this act pursuant to Section 6 of Article XIII B of the California Constitution because the only costs that may be incurred by a local agency or school district will be incurred because this act creates a new crime or infraction, eliminates a crime or infraction, or changes the penalty for a crime or infraction, within the meaning of Section 17556 of the Government Code, or changes the definition of a crime within the meaning of Section 6 of Article XIII B of the California Constitution.