The Regulatory Mix, TMI’s daily blog of regulatory activities, is a snapshot of PUC, FCC, legislative, and occasionally court issues that our regulatory monitoring team uncovers each day. Depending on their significance, some items may be the subject of a TMI Briefing.



In a blog posting, FCC Chairman Tom Wheeler offered some details about a proposed Order to reform universal service support for rate-of-return carriers. Tagged as a “bipartisan solution,” the proposed Order is the result of a joint effort by the Chairman and Commissioners O’Reilly and Clyburn and various representatives of rate-of-return carriers. It reflects two agreed-upon principles: assuring that funds go to the delivery of service and a focus on maintaining existing service and bringing broadband to unserved areas.

Wheeler said that the proposed Order would create a voluntary path for rate-of-return carriers that prefer the predictability of defined support amounts over a ten-year term. Similar to the approach used for price-cap carriers, the model-based support would have defined milestones for efficient, accountable deployment. For carriers that choose to continue receiving support based on traditional rate-of-return principles, the proposed Order would provide more certainty, increase fiscally responsible management of the fund, and ensure that a reasonable portion of support is spent on new buildout to connect those that remain unserved. To better meet the needs of consumers, the FCC would, for the first time, provide support for stand-alone broadband without a voice service subscription, building on the framework of its longstanding rules.

To limit the universal service fund’s burden on ratepayers, the proposed Order would adopt budget control mechanisms to ensure that rate-of-return carriers collectively stay within the established rate-of-return budget. As such, it reflects the so-called “Walden Rule,” that we should limit the use of ratepayer funds to support service in an area that is served by an unsubsidized Internet provider. The proposed Order would also lower the authorized rate of return for incumbent carriers to better reflect current financial market conditions. A Further Notice included with the Order would seek comment on additional reforms that would further guard against waste.


Proposed Assembly Bill 2773 would change the definition of “high-speed broadband services” minimum speed from 384 kilobits per second to 500 kilobits per second for the purpose of the California Teleconnect Fund. Existing law (PU Code §884) says that it is the intent of the Legislature that any program administered by the Public Utilities Commission “that addresses the inequality of access to high-speed broadband services by providing those services to schools and libraries at a discounted price, provide comparable discounts to a nonprofit community technology program.”

Proposed Assembly Bill 2184 would prohibit the imposition by the state and any political subdivisions of the state of a tax on Internet access or use of Internet access. The proposed bill, called the California Internet Tax Freedom Modernization Act of 2016, is intended “to provide California consumers with certainty that Internet access will never by burdened by rates of taxation that are discriminatory in nature.”


The Utilities Commission has approved a settlement agreement resolving all issues in its review of the Qwest Corporation d/b/a CenturyLink QC (CenturyLink) 911 service outage affecting Washington residents on April 9-10, 2014. The Commission said it is satisfied that the settlement “appropriately reflects the severity of the April 2014 outage and resulting violations and furthers the goal of compliance with the statute and Commission rules.” CenturyLink agreed to pay a penalty of $2,854,750 and will designate a compliance officer responsible for monitoring its compliance with the settlement. Until all Public Safety Answering Points (PSAPs) in Washington have completed the transition to Next Generation 911 (NG911), CenturyLink will:

  • submit quarterly reports detailing (1) the maximum number of messages its PSAP Trunk member (PTM) threshold counter can process; (2) the frequency of manual review; and (3) the counter value as of the reporting date;
  • annually perform a 911 Circuit Diversity Audit as outlined in the FCC’s December 2013 Report and Order in PS Docket No. 13-75 and report the results to Staff; and
  • submit to Staff annual IP transition status reports.

The State’s Attorney General previously asked the Commission (UTC) to reject the proposed settlement and impose the maximum regulatory penalty of $11.5 million on CenturyLink. See the Regulatory Mix dated 1/13/16.


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