6. Comments on Proposed Decision

The proposed decision (PD) of the assigned Commissioner in this matter was mailed to the parties in accordance with Section 311 of the Public Utilities Code and Rule 14.2(a) of the Commission's Rules of Practice and Procedure.

On June 12, 2008, AT&T and the Small LECs filed Opening Comments. On June 17, 2008, AT&T and Verizon filed Reply Comments.

AT&T's Opening Comments reargue that "federal law preempts the California Commission from regulating broadband services."78 In addition, AT&T argues that "imposition of additional broadband reporting requirements is contrary to DIVCA."79

Finally, AT&T anticipates potential discrepancies between FCC requirements and those adopted by this Commission, arguing that "even if the Commission did have jurisdiction, which it does not, the proposed decision would not implement its intent to require only the submission of FCC data."80 On this matter, AT&T speculates that there will be conflicts between "the Commission's methodology for making a reasonable approximation using alternate geospatial areas"81 and the methodology adopted by the FCC.

The Small LECs state that although the "appreciate the clarifications made to the draft rules pertaining to extension applications,"82 they continue to assert "that there is an apparent conflict"83 between two sections of the DIVCA statute. The Small LECs state that they support the modifications to the bond requirements and the confidentiality protections for reported data, but that they "are concerned that the PD would implement modifications to reporting related to broadband tiers in a way that might not be fully consistent with FCC requirements."84

In its Reply Comments on the PD,85 AT&T identifies potential discrepancies between the PD's proposal for reporting on the availability of broadband service and the FCC's plan to adopt an order addressing this matter in four months.

Verizon's Reply Comments on the PD generally support AT&T's concerns over a conflict between state and federal reporting requirements. Verizon states:

Now that the FCC order is out, the Commission should reevaluate its own data filing requirements and templates to conform to the FCC's requirements. ... Verizon concurs with AT&T's assessment that the proposed amendments to General Order 169 would "overlay" the speed tier reporting requirement in such a way as to require franchises to "correlate speed tier data to the Commission's existing reporting structure" and "perform unique and significant analysis to fit the speed data into the Commission's existing structure."86

In response to the comments, we have re-evaluated the reporting requirements that are under consideration in this phase of the DIVCA proceeding. We have removed any inconsistencies between our reporting requirements and those adopted in the FCC's Form 477 Order.

In particular, to insure that there is no conflict, we have deferred any changes to the existing requirements concerning reporting on the availability of broadband services. We anticipate that the FCC data on availability will also serve the goals the DIVCA has set for the Commission. As a result, we will order the Communications Division of the Commission to prepare a resolution amending GO 169 after the FCC adopts requirements concerning the reporting on the availability of broadband services.

In addition, we have conformed the reporting requirements concerning broadband subscribership by speed tier and by census tract to those adopted by the FCC. Moreover, although we note that the Form 477 Order has cited this Commission's work favorably, we have taken the extra step to ensure that should a conflict arise between the processes for assigning a customer address to a census tract, we will defer to the federal methodology in order to ensure comparability of California's broadband statistics with those of other states.

Concerning AT&T's arguments that this Commission lacks jurisdiction to require the filing of reports on broadband, we find them unpersuasive.

AT&T states "As the FCC and the federal courts have recognized, `Congress intended to keep the Internet and information services unregulated.'"87 AT&T then argues that the federal intention to avoid regulation of the Internet preempts the state reporting requirement that we adopt.

AT&T's argument goes too far. AT&T's argument would appear to require us to conclude that the FCC's reporting requirement does not constitute regulation of the Internet and information services, but the identical reporting requirement adopted by the Commission is intrusive regulation inconsistent with national policy. Logically, the reporting requirement cannot both "not be" and "be" regulation.

More importantly, as discussed above, the broadband reporting requirements do not conflict with the federal requirements. We have authority under DIVCA to collect data regarding broadband subscribership and availability. Moreover, the Commission is merely seeking the same data that the FCC is requiring franchise holders to provide to the Commission. Therefore, there is no validity to AT&T's argument of preemption as there is no conflict between federal and state requirements.

78 Opening Comments of AT&T California on Proposed Decision of Commissioner Chong Mailed May 23, 2008 (Opening Comments) at 2.

79 Id. at 6.

80 Id. at 7.

81 Id. at 8

82 Opening Comments of Calaveras Telephone Company (U1004C), Cal-Ore Telephone Co. (U1006C), Ducor Telephone Company (U1007C), Foresthill Telephone Co. (U1009C), Happy Valley Telephone Company (U 1010 C), Hornitos Telephone Company (U1011 C), Kerman Telephone Co. (U1012C), Pinnacles Telephone Co. (U1013C), The Ponderosa Telephone Co. (U1014C), Sierra Telephone Company, Inc. (U1016C), The Siskiyou Telephone Company (U1017C), Volcano Telephone Company (U1019C), Winterhaven Telephone Company (U1021C) on Proposed Decision Mailed May 23, 2008, June 12, 2008

83 Id.

84 Id.

85 Reply Comments of AT&T California on Proposed Decision of Commissioner Chong Mailed May 23, 2008 (Reply Comments on PD of AT&T), June 17, 2008.

86 Reply Comments of Verizon California Inc. (U1002C) to Comments on the Proposed Decision, June 17, 2008 at 1-2 (footnotes omitted).

87 Comments of AT&T on PD at 2 (footnote omitted).

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