ALJ/KOT/oma Date of Issuance 12/22/2010

BEFORE THE PUBLIC UTILITIES COMMISSION OF THE STATE OF CALIFORNIA

Order Instituting Rulemaking to Consider Modifications to the California Advanced Services Fund Including Those Necessary to Implement Loan Program and Other Provisions of Recent Legislation.

FILED PUBLIC UTILITIES COMMISSION DECEMBER 16, 2010 SAN FRANCISCO OFFICE RULEMAKING 10-12-008

ORDER INSTITUTING RULEMAKING

1. Introduction

On September 25, 2010, Governor Schwarzenegger signed into law Senate Bill 1040. This emergency legislation amended Section 281 of the Public Utilities Code. As amended, Section 281 extends and modifies the California Advanced Services Fund which is part of a program that the Commission had previously established for the purpose of encouraging deployment of "broadband" communications infrastructure to all Californians. This rulemaking is instituted to implement the provisions of the Senate Bill 1040, such as the increased overall funding for the program and the new consortia grant and broadband infrastructure revolving loan accounts. The rulemaking will also address other possible changes to the program, including those suggested in a pending petition by the Commission's Division of Ratepayer Advocates to modify one of the Commissions earlier decisions regarding the fund (Decision 07-12-054).