No quick changes for Californian broadband subsidy program

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Glaciers are slow, but reliably arrive.

Because it was tagged as urgency legislation and then approved by a two-thirds vote of the California legislature, senate bill 740 took effect the moment it was signed by Governor Brown. Even so, don’t expect any immediate changes to the way the California Advanced Services Fund (CASF) is managed or broadband construction subsidies are given out.

Eleven months ago, the California Public Utilities Commission began the lengthy process of changing CASF eligibility rules, under the assumption that the legislature would allow it. Even so, it’s still going to take six months to a year to finish rewriting the rules. Only then will the CPUC give cities and independent ISPs a chance to apply for CASF grants and loans.

An early draft of new rules was floated back in March. The general idea was to require something like the same level of financial scrutiny and collateral that telephone companies have to meet in order to be certified by the CPUC. The draft generated a fair number of comments and counter-comments that the CPUC administrative law judge working on the draft is still digesting.

Passage of SB 740 means the guess work ends and the CPUC can move ahead with writing rules to comply with it. The work done to date provides a good foundation, but it’s still many months from being complete.

Meanwhile, the CPUC is chewing through the CASF subsidy proposals submitted last February. If you take SB 740 at face value – it appears to reaffirm current CASF policy and practice – it should have no effect on the pending applications. But don’t bet the ranch that the incumbent cable and telephone companies that have been complaining bitterly about some of the proposals won’t try to use the new law to raise objections, legitimate or not.

Assembly bill 1299, which was also signed by the governor, doesn’t take effect until January. That gives the CPUC some breathing room to write rules for the public housing broadband programs it creates. Since it’s a relatively small amount of money – $20 million for broadband facilities and $5 million for marketing – and it has similarities with the regional broadband consortia program, writing those rules might not take so long.

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