Calif. Senators Seek Changes to Internet Discrimination, Affordability Bills

California state senators pushed back on two digital equity bills Tuesday. Multiple Communications Committee members during a livestreamed hearing raised concerns about the Assembly-passed AB-2239, which would ban digital discrimination as the FCC defines it. Also, the committee scaled back the Assembly-approved AB-1588, which had proposed to update the California LifeLine subsidy program to support broadband for low-income households. The committee directed the LifeLine bill’s sponsor to find a compromise with industry opponents and other stakeholders over the summer recess that runs from July 3 to Aug. 5.

The Senate panel voted 11-4 to advance the digital discrimination bill to the Judiciary Committee. But in addition to Republican members voting no, three Democrats said they were not voting on the measure: Sens. Josh Becker, Bill Dodd and Dave Min. The Judiciary Committee was expected to vote on the bill later Tuesday.

Assemblymember Mia Bonta (D) accepted amendments by the Communications Committee to her bill, though she said they wouldn’t be adopted until the Judiciary panel clears the measure. The committee had recommended clarifying that the prohibition on digital discrimination applies to the same covered entities in the FCC order and to delete rules proposed for California Public Utilities Commission broadband programs (see 2406250041). Bonta noted that the amended definition of covered entities is “missing some key guardrails” that she hopes to add to the bill later.

Dodd said he worried about bill opponents saying the bill’s inclusion of a disparate impact standard, rather than a disparate treatment standard that considers intention, will spur unnecessary litigation and discourage broadband deployment. He asked why Bonta wouldn’t accept an amendment that switches to the treatment standard. Some other members also raised liability concerns after the California Video & Broadband Association (CalBroadband) mentioned the issue on behalf of cable members. Other ISP groups including USTelecom and CTIA also opposed the bill.

“The Chicken Little refrain” that a given policy will discourage deployment and innovation “has been used time and time again by industry,” Bonta replied to Dodd. “We cannot fall for that. It is time for us to be able to apply a very high standard of disparate impact,” which considers situations when a seemingly neutral practice has a disproportionately negative impact on one group over another. Dodd insisted that applying disparate impact could create "a real problem of ... litigation and unintended consequences." But Bonta said "the real life consequences" are people of color not receiving "the kind of internet service that they need.”

Last week’s U.S. Supreme Court decision reversing Chevron is another reason California should act, Bonta said. The SCOTUS ruling makes Bonta “question whether or not the FCC” can “continue operating at their full strength,” she said. California must “step into that space right now and lead.” Some others have said the SCOTUS ruling could have implications for state authority (see 2407010036).

The committee voted 14-4 to advance AB-1588 to the Appropriations Committee after author Assemblymember Lori Wilson (D) accepted amendments and agreed to summer talks. The bill previously proposed authorizing the CPUC to use state LifeLine subsidies for broadband, expand the contribution base to include VoIP lines and authorize the CPUC to make rules for calculating and collecting surcharges. But the committee recommended deleting the current text and instead require “the CPUC to establish an expedited process by which an existing regulated telephone service provider that offers broadband services or has an affiliate that offers broadband services can become” an eligible telecom carrier for the purposes of providing Lifeline services.

“As Congress has failed to act” to fund the federal affordable connectivity program (ACP) and there’s “no expectation that they will do so in the near future, it is incumbent that the state take immediate action to ensure we continue to close the digital divide,” Wilson said. LifeLine “is an existing program for essential communication” and today broadband is essential, she said.

Chair Steven Bradford (D) shares concerns about ACP ending and wants to ensure low-income communities can afford internet plans, “but we need to make sure that we get the language right and to ensure that the changes to LifeLine provide meaningful benefits without burdens on our ratepayers,” he said. The committee is “committed to work on this bill and ensure that we strike the right balance as it moves through the process,” added Bradford.

Industry looks forward to working over the summer with Wilson, lobbyists for CalBroadband, USTelecom, CTIA, the Wireless Infrastructure Association and the California Communications Association said. CalBroadband is “dedicated to working with the author” to determine the appropriate subsidy for low-income Californians and “what if any increase in the current CPUC surcharge authority is needed," said Amanda Gualderama, director-legislative and regulatory advocacy. Other issues include what provider requirements, eligibility parameters and legislative guardrails on the CPUC are needed, she said.

Prior to the Communications Committee hearing, the panel scrapped an AT&T-backed bill about carrier of last resort (COLR) relief that was originally on the agenda (see 2407010052).

Updating California’s COLR policy remains a matter for the legislature, despite the failure of AB-2797, sponsor Assemblymember Tina McKinnor (D) said in an emailed statement Monday. “Unfortunately, we did not have enough time to reach an agreement this year. We will continue to work on this issue with stakeholders to get it right for our constituents.” Most people have transitioned from copper to modern networks, McKinnor added. “But for those 5% that have not, we cannot pretend we’re protecting people by leaving them on an old and inferior network.”

However, U.S. Rep. Anna Eshoo (D) applauded the COLR bill’s demise. “My constituents scored a win with the withdrawal of state legislation that would have allowed AT&T to leave them without a landline to call 911 in an emergency and communicate daily in their rural settings where there is poor or non-existent broadband,” Eshoo said. Although it denied COLR relief to AT&T last month, the CPUC simultaneously opened a rulemaking that considers updating COLR rules for modern technology (see 2406200065). Comments are due this fall.