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A01667
THE GENERAL ASSEMBLY OF PENNSYLVANIA
SENATE RESOLUTION
No.
48
Session of
2019
INTRODUCED BY PHILLIPS-HILL, YAW, HUTCHINSON, COSTA, BAKER,
AUMENT, STEFANO, WHITE, BROWNE, HAYWOOD AND BARTOLOTTA,
APRIL 29, 2019
REFERRED TO COMMUNICATIONS AND TECHNOLOGY, APRIL 29, 2019
A RESOLUTION
Directing the Legislative Budget and Finance Committee to
conduct an audit on a review of the compliance of
telecommunication carriers with the Public Utility Code and
high-speed broadband universal service deployment mandates of
the Public Utility Code and to report their findings and
recommendations to the Senate.
WHEREAS, The purpose of 66 Pa.C.S. Ch. 30 was to ensure that
all areas of this Commonwealth have a modern, state-of-the-art
broadband telecommunications network by the end of 2015, with
incumbent local exchange telecommunications companies (ILETCs)
receiving substantially greater pricing and earnings flexibility
than the traditional rate-of-return form of regulation under
which the prices and earnings had originally been set to fund
the deployment of high-speed broadband networks throughout this
Commonwealth; and
WHEREAS, The intended goal of 66 Pa.C.S. Ch. 30 was to
promote an accelerated roll-out of a mass market and universal
broadband network that would establish this Commonwealth as a
national leader in broadband deployment; and
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WHEREAS, Chapter 30 of 66 Pa.C.S., which added sections 3001
through 3009, was enacted and made effective immediately through
Act 67 of 1993; and
WHEREAS, In 1993, telecommunications carriers operating in
this Commonwealth adopted an alternative form of regulation and
network modernization plans to replace existing copper-based
network infrastructure with a hybrid of fiber optic and coaxial
cables to deliver high-speed broadband at speeds of at least 45
megabits per second (Mbps) in both directions throughout 100% of
their urban, suburban and rural service territories by the end
of 2015; and
WHEREAS, In their first two biennial updates,
telecommunications carriers reiterated their commitment to
deploy high-speed broadband at speeds of 45 Mbps or greater to
customer locations within five business days even though the
statutory minimum for universal broadband availability was 1.544
Mbps; and
WHEREAS, In June 2000, telecommunications carriers filed
their third biennial update with the Pennsylvania Public Utility
Commission (PUC) requesting approval of substantial revisions to
their network modernization plans that would retain their
existing distribution system of obsolete copper wire pairs to
deploy high-speed broadband at 1.544 Mbps through digital
subscriber line (DSL) services instead of replacing the network
with a hybrid of fiber optic and coaxial cables to deliver high-
speed broadband at speeds of at least 45 Mbps in both
directions, while obtaining financial benefits as a result of 66
Pa.C.S. Ch. 30; and
WHEREAS, In March 2002, the PUC rejected the
telecommunications carriers' third biennial update and concluded
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that telecommunications carriers unilaterally changed the
broadband commitment without properly notifying the PUC, stating
that:
(1) half of the telecommunications carriers' customers
having the capability and willingness to pay for DSL service
could not subscribe to the service as a result of distance
limitations from the telecommunications carriers' central
offices;
(2) even fewer residential customers had DSL service
available to them at speeds of 1.544 Mbps or more; and
(3) the 1.544 Mbps bandwidth proposed by
telecommunications carriers for those customers was far below
the 45 Mbps bandwidth approved in their 1995 network
modernization plans and their first two PUC-approved biennial
reports in 1996 and 1998;
and
WHEREAS, In September 2002, telecommunications carriers filed
a petition to amend their network modernization plans to:
(1) deploy fiber or comparable technology to remote
terminals to make higher bandwidth services available for
purchase by more customers;
(2) make available, upon customer request, broadband
services of at least 1.544 Mbps within five days of a
customer's request; and
(3) make at least 45 Mbps service available within
commercially reasonable times and establish DSL deployment
benchmarks at various speeds and types of DSL to reach 45% of
rural lines by 2006;
and
WHEREAS, In July 2003, the PUC officially permitted
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telecommunications carriers to break the commitment to the
Commonwealth to deploy a 45 Mbps high-speed hybrid fiber optic
and coaxial cable broadband network and replaced that commitment
with a mandate to deploy broadband at a speed of 1.544 Mbps with
the following benchmarks regarding each urban, suburban or rural
exchange:
(1) 50% by 2004;
(2) 60% by 2006;
(3) 70% by 2008;
(4) 80% by 2010;
(5) 90% by 2012; and
(6) 100% by 2015;
and
WHEREAS, In July 2003, the PUC a Pennsylvania Public Utility
Commission (PUC) order also directed telecommunications
carriers to upgrade all central offices and existing remote
terminals and construct new terminals to provide broadband
service at 1.544 Mbps within five days of a customer request;
and
WHEREAS, Immediately following the sunset of 66 Pa.C.S. Ch.
30 on December 31, 2003, the PUC issued a statement of policy to
clarify the duties and obligations of ILETCs regarding final PUC
orders issued under former 66 Pa.C.S. Ch. 30 and reinforced that
previously approved plans would remain in effect and were fully
enforceable in all aspects upon all ILETCs; and
WHEREAS, Act 183 of 2004 repealed 66 Pa.C.S. §§ 3001-3009 and
added §§ 3010-3019 to provide additional economic and regulatory
incentives to ILETCs to further facilitate the deployment of a
Statewide broadband network by:
(1) encouraging earlier completion of existing network
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modernization plans;
(2) reducing the inflation offset under the companies'
price cap form of rate regulation;
(3) eliminating outdated PUC filing and reporting
regulations; and
(4) establishing several funds and programs to further
facilitate broadband deployment beyond the deployment
commitments contained in the certain companies' network
modernization plans, including:
(i) a bona fide retail request (BFRR) program;
(ii) a business attraction or retention program;
(iii) the Broadband Outreach and Aggregation Fund;
and
(iv) the Education Technology Fund;
and
WHEREAS, In February 2005, this Commonwealth's largest
telecommunications carriers carrier filed a revised network
modernization plans plan with the PUC to comply with Act 183 of
2004; and
WHEREAS, The plans were plan was approved by order entered in
May 2005 to:
(1) require the telecommunications carriers carrier to
retain their its commitment of broadband availability to 100%
of the total retail access lines by December 31, 2015, under
the same benchmarks as outlined in the third supplement to
their its network modernization plans plan approved by the
PUC in August 2004; and
(2) allow telecommunications carriers the carrier to
reduce the inflation offset of the its price stability
mechanism from 2.93% to 0.5% to generate additional funding
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dedicated to the deployment of high-speed broadband service
at 1.544 Mbps through urban, suburban and rural areas of
their its service territories;
and
WHEREAS, In December 2011, this Commonwealth's largest
telecommunications carriers filed plans to announce their
intentions carrier filed a plan pursuant to statute to announce
its intention to use other technologies, including fixed
wireless, to meet the statutorily mandated broadband deployment
benchmarks, stating their its commitment to inform the PUC about
deploying technologies to make broadband available to customers;
and
WHEREAS, The filing was approved by Secretarial Letter dated
August 2012; and
WHEREAS, On September 7, 2012, David K. Ebersole and the
Office of Consumer Advocate filed a joint petition seeking a
declaratory order and asserting that this Commonwealth's largest
telecommunications carrier did not meet its:
(1) legal obligation to the Greensburg community service
area (CSA) 1125 BFRR for accelerated deployment of advanced
services; and
(2) legal broadband deployment obligation because it
directed the BFRR applicants to apply to the
telecommunications carrier's wireless affiliate for wireless
4G LTE broadband services, which caused the Greensburg CSA
customers to believe, for approximately two years, that they
would be receiving wireless DSL service to meet their request
filed in July 2010;
and
WHEREAS, In February 2013, the PUC approved a final order and
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concluded that the PUC cannot specifically require
telecommunications carriers the carrier to deploy DSL service to
meet the BFRR of the Greensburg CSA l125 customers or to set a
specific price for the retail broadband access service offered
those customers as part of the request; and
WHEREAS, The PUC approved this Commonwealth's largest
telecommunications carrier's joint venture with its wireless
affiliate to provide retail broadband access service to rural
BFRR customers; and
WHEREAS, The largest telecommunications carrier's joint
venture agreement with its wireless affiliate changes a
potential alternative provider of broadband service into the
carrier's designated provider, which may constitute illegal
cross-subsidization under 66 Pa.C.S. § 3016(f)(1) and the
corresponding PUC regulations under 52 Pa. Code § 63.143(4)(i);
and
WHEREAS, The largest telecommunications carrier's customers
who receive wireless broadband services to satisfy a BFRR are
required to address any service or billing disputes with the
wireless affiliate, further raising cross-subsidization concerns
because the carrier's wireless affiliate which is an unregulated
provider of wireless competitive services and may or may not
receive dedicated funding only for the benefit of the carrier's
customers where broadband must be deployed, and the funding may
or may not be used by the wireless affiliate to offer
competitive wireless services to the general public; and
WHEREAS, The pricing for the wireless 4G LTE that is provided
through the this Commonwealth's largest telecommunications
carrier's joint venture is affected by certain data usage caps
and tiers, various equipment charges, service reliability issues
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and contract periods that may exceed the one-year contractual
term that is statutorily specified for the routine engagement of
retail broadband access service under the BFRR process and could
be considered cost prohibitive to rural customers that lack
access to alternative broadband service providers and who have
paid increased telephone fees for decades to telecommunications
carriers for the deployment of broadband services; and
WHEREAS, The promise by telecommunications carriers to bring
fiber Internet or comparable technology to their entire urban,
suburban and rural service territories has instead resulted in
an estimated 2,000,000 Pennsylvania homes having slower DSL
service, unreliable wireless service or no service at all; and
WHEREAS, The deployment and adoption of broadband technology
in rural communities is a central policy challenge facing this
Commonwealth; and
WHEREAS, Broadband service is an engine of economic growth
that offers rural communities the hope of economic development,
the promise of economic revitalization, the energy of an
educated productive citizenry and the benefit of a positive
quality of life; and
WHEREAS, Access to broadband and advanced telecommunication
technology is essential for full participation in economic and
social life for every Pennsylvanian; and
WHEREAS, Consumers in this Commonwealth continue to stress
the need for faster digital connections so that local businesses
can sell products globally, school children can receive a
quality education and farmers can operate high tech equipment,
especially in rural areas; and
WHEREAS, The Federal Communications Commission's Connect
America Fund offered funding to this Commonwealth's largest
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telecommunications carrier to build new broadband network
infrastructure or upgrade networks in areas where it might not
be as profitable, yet hundreds of millions of dollars in Connect
America Funds have been declined by the carrier; therefore be it
RESOLVED, That the Senate direct the Legislative Budget and
Finance Committee to conduct an audit on a review of the
compliance of telecommunication carriers with high-speed
broadband universal service deployment mandates under the Public
Utility Code; and be it further
RESOLVED, That the Legislative Budget and Finance Committee:
(1) determine whether telecommunications carriers have
fulfilled their commitments under the Public Utility Code 66
Pa.C.S. Ch.30 to accelerate broadband availability to 100% of
their total retail access lines in their distribution
networks by December 31, 2015;
(2) analyze efforts by the PUC and the Department of
Community and Economic Development regarding compliance and
administration of BFRR programs under 66 Pa.C.S. § 3014(c);
(3) examine joint venture arrangements under approved
NMPs for compliance with 66 Pa.C.S. Ch. 30 and analyze the
impact of joint venture arrangements on the quality and
affordability of service provided; and
(4) examine actions taken by the PUC under 66 Pa.C.S. §
30l5(a)(2) and 66 Pa.C.S. Ch. 33 in relation to violations of
66 Pa.C.S. § 3014(b)(3)(ii)(B), (c) or (k) or 3016(c) or (f);
and be it further
RESOLVED, That the Legislative Budget and Finance Committee
issue a report of its findings and recommendations to the Senate
within one year of the date of adoption of this resolution.
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