CPUC begins rewrite of California broadband infrastructure subsidy rules

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California’s broadband primary infrastructure program, the California Advanced Services Fund (CASF), is in for an overhaul by the California Public Utilities Commission. Last year, the California legislature passed and governor Jerry Brown signed assembly bill 1665, which pumped more money into the fund but also placed severe, incumbent-centric restrictions on how it can be spent.

It’s up to the CPUC, though, to decide the detailed objectives, rules and procedures for the program. Yesterday, commissioner Martha Guzman Aceves posted a scoping memo and ruling, which outlines extensive changes proposed by CPUC staff, and a schedule for reaching a decision.

There will be two phases. Because of deadlines set by the new law, the first order of business will be to create a new program that will fund what the legislature broadly defines as broadband adoption initiatives. As Guzman Aceves’ ruling states, funded activities…

Could include increasing access to free publicly available broadband, after-school broadband access and digital inclusion for communities with low adoption. Grants from this Account could be for digital literacy training programs and public education to communities with limited broadband adoption, including low-income communities, senior communities, and communities facing socioeconomic barriers to broadband adoption.

Phase 2 will focus on broadband infrastructure subsidies. Industry lobbyists wrote and lawmakers approved sharp restrictions on where broadband projects can be funded, what kind of infrastructure is allowed and who can apply for the subsidies. AB 1665 lowered California’s broadband speed standard to 6 Mbps download and 1 Mbps upload speeds, which had the effect of reducing the number of eligible homes from somewhere in the hundreds of thousands range to the low ten of thousands. It also carved special privileges for incumbents, with substantial perks for AT&T and Frontier Communications.

Other issues will be rolled into the two phases, including changes to the public housing and regional broadband programs, and establishment of a line extension program, which would funnel money through individuals to Internet service providers for relatively small extensions of existing systems. It’s a program that was pushed by cable lobbyists, who don’t want to deal directly with the CPUC.

I’ll do deeper dives in the coming days on the draft rules proposed, as a starting point, by CPUC staff, but you can read through everything by clicking the links below. The first milestone comes on 16 March 2018, when comments are due on the adoption and public housing program proposals. The schedule outlined by Guzman Aceves calls for both phases to be wrapped up before the end of the year.

Scoping memo and ruling of assigned commissioner, Martha Guzman Aceves, CASF program changes, 14 February 2018

Appendix A, AB 1665 changes to CASF program

Appendix B, CPUC staff proposals for broadband adoption, public housing and loan programs

Appendix C, CPUC staff proposed changes for broadband infrastructure grant, line extension and regional broadband consortia programs