California Lawmakers Pass PUC Transparency Changes, Punt Telecom Review

“PUC reform is officially dead,” Assemblymember Mike Gatto (D) tweeted at midnight PT. He referred to the death of his AB-2903, an omnibus bill that was one part of the four-bill package and included a proposed review of the state’s telecom regulatory structure. Gatto, a major critic of Frontier Communications transition woes, blamed the clock for the bill's not passing. He tried to save the bill after the deadline by doing a “gut and amend” on another bill -- stripping its language and replacing it with the CPUC reform measure -- and adding an urgency clause to allow a post-midnight vote, but he was unable to get needed Republican support, a Gatto spokesman told us.

"Our bill tried to narrow down the scope of the CPUC, focusing on utilities safety and oversight, and it's unfortunate that this bill wasn't able to get passed,” the Gatto spokesman said. Gatto’s term is up. Also apparently dead is another CPUC reform bill (SB-1017) aimed at increasing public access to utility-supplied documents at the agency. AT&T, CTIA and other industry officials had raised concerns that measure could result in confidential and sensitive information (see 1608110007). It didn’t get a vote Wednesday.

Legislators did pass two CPUC process reform bills in the package negotiated between Brown and lawmakers (see 1606270076). The Senate voted 32-6 Wednesday to pass SB-512, which would make documents, testimony and correspondence about commission proceedings more readily available to the public. Last week, legislators passed SB-215, aimed at tightening ex parte communication rules and precluding conflicts of interest of commissioners and administrative law judges. The legislature also passed two CPUC reform measures not part of the official package, including SB-62, creating a new safety advocate office at the CPUC, and AB-2168, requiring the commission to post reports of utility inspections and audits on its website.

“What's left of the package isn't hugely significant,” emailed Tellus Venture Associates President Steve Blum, a community broadband consultant for cities. “Telecoms regulation in California is still a muddle of laws and regulations that have accumulated over the past 100 years, and nothing was done this legislative session to either simplify and clarify that muddle, or make the CPUC more efficient or effective.” The failed AB-2903 “would have made significant structural changes to CPUC regulatory oversight, at least where transportation is concerned, and opened the door for the same for telecoms,” Blum said. An early draft specified what the telecom review should include, but that language was stripped out Aug. 17. Meanwhile, the failed SB-1017 “would have been a nice change, but not a major one,” Blum said.

One takeaway “is that it is very difficult to overcome entrenched interests,” said Blum. “To make changes in California's telecoms regulatory structure, people will have to accept that business will be done differently -- that's true whether you're AT&T or Caltrans. But entrenched interests are very good at fighting defensive battles and broad coalitions will be needed in the future if changes are to be made. A few activists or aggrieved residents are not sufficient.”

Brown will probably sign SB-215 and SB-512, said Blum. They “will make the CPUC's work more open, but also more complicated,” he said. Blum predicted Brown also will sign AB-2168, but not SB-62, because it wasn't part of the original reform package and “since it's the sort of ad hoc rearrangement of the bureaucracy that Brown generally opposes.”

Some praised surviving CPUC reforms. “For the first time, CPUC Commissioners will have a statutory duty to promptly report the content of their ex parte communications and will face penalties for violations of the rules,” Sen. Mark Leno (D) said in an Aug. 25 news release on his SB-215. That bill “seeks to change the agency’s culture that has been too cozy with utility executives and less accountable to California consumers,” he said. The Utility Reform Network Executive Director Mark Toney said the bill “will put an end to the secret, back-door meetings that have tainted the CPUC's decision-making process and its reputation.” The CPUC didn't comment.

In other telecom votes before the buzzer, the Assembly voted 79-0 for final passage of AB-2570, requiring the CPUC to adopt a portability freeze rule for the state LifeLine program by Jan. 15. Other recently passed telecom bills waiting to be signed by the governor include SB-1137, a bill that would define ransomware as a form of extortion; SB-745, which requires the CPUC to prioritize unserved housing developments and other changes to grant programs provided by the California Advanced Services Fund; and AB-1549, a dig-once bill requiring the California Department of Transportation to notify broadband companies about highway construction projects so they can install broadband conduit as part of each project (see 1608240019). SB-745 and AB-1549 will likely be signed by Brown, who was involved in their development, and the governor probably also will sign AB-2570, which was “watered down enough” from its original language, Blum said.