Bill Text: CA AB34 | 2021-2022 | Regular Session | Amended

NOTE: There are more recent revisions of this legislation. Read Latest Draft
Bill Title: Broadband for All Act of 2022.

Spectrum: Strong Partisan Bill (Democrat 11-1)

Status: (Introduced) 2021-05-05 - In committee: Set, first hearing. Referred to APPR. suspense file. [AB34 Detail]

Download: California-2021-AB34-Amended.html

Amended  IN  Assembly  March 16, 2021

CALIFORNIA LEGISLATURE— 2021–2022 REGULAR SESSION

Assembly Bill
No. 34


Introduced by Assembly Members Muratsuchi, Eduardo Garcia, and Santiago
(Principal coauthor: Senator Glazer)
(Coauthors: Assembly Members Ting and Wood)

December 07, 2020


An act relating to communications. An act to add Title 26 (commencing with Section 101000) to the Government Code, relating to broadband, by providing the funds necessary therefor through an election for the issuance and sale of bonds of the State of California and for the handling and disposition of those funds.


LEGISLATIVE COUNSEL'S DIGEST


AB 34, as amended, Muratsuchi. Communications: Broadband for All Act of 2022. Broadband for All Act of 2022.
Existing law requires the Department of Technology to improve the governance and implementation of information technology by standardizing reporting relationships, roles, and responsibilities for setting information technology priorities. Existing law requires the Public Utilities Commission to develop, implement, and administer the California Advanced Services Fund program to encourage deployment of high-quality advanced communications services to all Californians. Existing law provides that the goal of the program is to, no later than December 31, 2022, approve funding for infrastructure projects that will provide broadband access to no less than 98% of California households, as provided.
This bill would enact the Broadband for All Act of 2022, which, if approved by the voters, would authorize the issuance of bonds in the amount of $10,000,000,000 pursuant to the State General Obligation Bond Law to support the 2022 Broadband for All Program that would be administered by the department for purposes of providing financial assistance for projects to deploy broadband infrastructure and broadband services.
The bill would provide for the submission of the bond act to the voters at the November 8, 2022, statewide general election.

Under existing law, the Public Utilities Commission has regulatory authority over public utilities, including telephone corporations. Existing law requires the commission to develop, implement, and administer the California Advanced Services Fund program to encourage deployment of high-quality advanced communications services to all Californians. Existing law provides that the goal of the program is to, no later than December 31, 2022, approve funding for infrastructure projects that will provide broadband access to no less than 98% of California households, as provided.

This bill would declare the intent of the Legislature to enact legislation that would enact the Broadband for All Act of 2022, to become operative only if approved by the voters at the November 8, 2022, statewide general election, to authorize the issuance of state general obligation bonds to fund increased access to broadband services to rural, urban, suburban, and tribal unserved and underserved communities.

Vote: MAJORITY2/3   Appropriation: NO   Fiscal Committee: NOYES   Local Program: NO  

The people of the State of California do enact as follows:


SECTION 1.

 Title 26 (commencing with Section 101000) is added to the Government Code, to read:

TITLE 26. Broadband for All Act of 2022

CHAPTER  1. General Provisions

101000.
 This title shall be known, and may be cited, as the Broadband for All Act of 2022.

101001.
 (a) The Legislature finds and declares all of the following:
(1) Broadband is essential to modern life and is a public health imperative. Californians need access to and use of broadband to ensure their quality of life.
(2) The COVID-19 pandemic has only reinforced our reliance on broadband and the importance of closing the digital divide.
(3) On August 14, 2020, the Governor issued Executive Order No. N-73-20 calling for a California State Broadband Action Plan to develop a “Broadband for All” Action Plan that reflects the state’s belief that broadband is essential to economic and workforce development, public safety, education, and an engaged public.
(4) This plan focuses on achieving the following three long-term goals:
(A) Availability of high-performance broadband at home, schools, libraries, and businesses.
(B) Accessibility to affordable broadband and necessary devices.
(C) Accessibility to training and support to enable digital inclusion.
(5) Improving broadband access will improve the life of Californians by enabling individuals to work, study, communicate, apply for government services, operate home-based businesses, receive emergency information, and access health care.
(6) Broadband ensures California’s ability to compete on the world stage and spur economic development to rebuild our economy during the state of emergency caused by the COVID-19 pandemic.
(b) In enacting this title, it is the intent of the Legislature to provide a comprehensive and fiscally responsible approach for addressing the varied challenges facing Californians who have inadequate broadband access by doing all of the following:
(1) Encourage competition and provide for more affordable broadband access to all Californians.
(2) Encourage digital inclusion and digital literacy for all Californians.
(3) Encourage regional networks where possible and using the best available technology and innovation to modernize broadband speed and performance standards.
(4) Support telework and distance learning for all and enable telehealth.
(5) Leverage private, federal, or local funding to produce the greatest public benefit.
(c) It is further the intent of the Legislature that investments of public funds pursuant to this title will result in public benefits that address the most critical statewide needs and priorities for public funding.

101002.
 For purposes of this title, the following definitions apply:
(a) “Anchor institutions” include, but are not limited to, public schools, community colleges, public universities, public libraries, parks, general acute care hospitals, rural health clinics, fire stations, police stations, California Highway Patrol offices, sheriff’s offices, municipal buildings, state buildings, and fairgrounds.
(b) “Committee” means the 2022 Broadband for All Finance Committee created pursuant to Section 101022.
(c) “Department” means the Department of Technology.
(d) “Director” means the Director of Technology.
(e) “Eligible entity” means a city, county, city and county, special district, local educational agency, county office of education, community college district, public university, joint powers authority, regional district, and California Native American tribe on the list maintained by the Native American Heritage Commission for the purposes of Chapter 905 of the Statutes of 2004.
(f) “Fund” means the 2022 Broadband for All Fund created pursuant to Section 101003.
(g) “Open access” means a wholesale network operation that serves multiple service providers that resell broadband access services.
(h) “Program” means the 2022 Broadband for All Program established pursuant to Section 101010.
(i) “State General Obligation Bond Law” means the State General Obligation Bond Law (Chapter 4 (commencing with Section 16720) of Part 3 of Division 4 of Title 2), as it may be amended from time to time.

101003.
 The proceeds of bonds, excluding those issued in accordance with Section 101029, issued and sold pursuant to this title shall be deposited in the 2022 Broadband for All Fund, which is hereby created in the State Treasury. All moneys in the fund, notwithstanding Section 13340, are hereby continuously appropriated without respect to fiscal years for the support of the 2022 Broadband for All Program. Bonds shall be issued and delivered in the amount determined by the committee to be necessary or desirable pursuant to Section 101023.

101004.
 The Legislature may, from time to time, amend any law related to the program to which funds are, or have been, allocated pursuant to this title for the purposes of improving the efficiency and effectiveness of the program or to further the goals of the program.

CHAPTER  2. 2022 Broadband for All Program

101010.
 (a) The department shall develop and implement the 2022 Broadband For All Program to provide financial assistance, in the form of grants, to eligible entities for projects that deploy broadband infrastructure and broadband services.
(b) To better coordinate and maximize the effects of the financial assistance, eligible entities are encouraged to form regional groups, such as joint powers authorities, in applying for financial assistance under the program.
(c) The department shall give preference to applications that leverage other private, federal, or local funding or produce the greatest public benefit.
(d) The department shall give preference to applications that serve unserved or disadvantaged communities.
(e) At least 25 percent of the funds available pursuant to this chapter shall be allocated for projects serving unserved or disadvantaged communities.
(f) The department shall give preference to projects that include multiple benefits, including, but not limited to, the following considerations:
(1) The number of anchor institutions served by the project.
(2) The number of unserved or disadvantaged communities served by the project.
(3) The project is undertaken by a joint powers authority.

101011.
 (a) For the purposes of awarding funding under the program, the department shall require a cost share of not less than 50 percent of the total costs of the project by the eligible entity.
(b) The department may waive or reduce the cost-sharing requirement if the project does either of the following:
(1) Directly benefits a disadvantaged community.
(2) Serves an unserved area.

101012.
 (a) In applying for the financial assistance, the eligible entity shall do all of the following:
(1) Identify anchor institutions that have no or inadequate broadband access and that will be served by the project.
(2) Demonstrate that the eligible entity has sufficient resources to provide broadband service and maintain the broadband infrastructure deployed by the project for at least five years.
(3) Complete a feasibility study for the project.
(b) (1) An eligible entity receiving financial assistance pursuant to the program shall do both of the following:
(A) Provide anchor institutions served by the project with broadband service free of charge.
(B) Provide open access to the broadband infrastructure to other internet service providers at a fair and reasonable price.
(2) An eligible entity shall not transfer the ownership, maintenance, control, and operation of broadband infrastructure funded, in whole or in part, by the program to a private entity.
(c) (1) An eligible entity receiving financial assistance under the program may provide broadband internet access service.
(2) If an eligible entity imposes a charge for broadband internet service pursuant to paragraph (1), until the date on which all outstanding bonds sold under this title are repaid, the eligible entity shall remit an amount determined by the department for purposes of servicing the outstanding bonds issued pursuant to this title.
(3) In determining the amount remitted back to the department pursuant to paragraph (2), the department shall ensure that the amount is fair and reasonable and in consideration of the ongoing operating costs of the project.
(d) An eligible entity providing broadband internet service under the program shall do all of the following:
(1) Comply with Article 12 (commencing with Section 53167) of Chapter 1 of Part 1 of Division 2 of Title 5.
(2) Provide broadband internet service to all residents in the project area at a minimum speed of 100 mbps downstream and 20 mbps upstream at a cost that is fair, reasonable, and nondiscriminatory.
(3) Develop and implement an outreach program to inform residents in the project area of the availability and the cost of broadband internet service.

101013.
 (a) Not more than 5 percent of the moneys awarded in a grant by the department to an eligible entity may be expended for technical assistance, including for planning and monitoring for successful design, selection, and implementation of projects authorized under the grant.
(b) Not more than 5 percent of the proceeds of the bond may be expended by the department for administrative costs.
(c) Not more than 5 percent of the proceeds of the bond may be expended by the department to provide technical assistance to eligible entities to apply for the program.

101014.
 (a) Before accepting applications for financial assistance under this title, the department shall develop and adopt project solicitation and evaluation guidelines for the program. The guidelines shall establish project application metrics to weigh and evaluate an application to determine the success of a project proposed by the application that will be funded by the program. The guidelines shall include monitoring and reporting requirements and may establish the maximum amount that will be awarded as a grant under the program.
(b) (1) In developing the guidelines, the department shall conduct at least three public hearings to consider public comments. One of the public meetings shall be held in northern California, one in the central valley region, and one in southern California.
(2) The department shall post the draft guidelines on its internet website at least 30 days before the first public hearing.
(c) Before adopting the guidelines, the director shall verify that the guidelines are consistent with applicable law and the purposes of this title.
(d) (1) Upon the adoption of the guidelines, the department shall post the guidelines and the verification made pursuant to subdivision (c) on its internet website.
(2) The department shall transmit the adopted guidelines to the appropriate policy and fiscal committees of the Legislature.

101015.
 Notwithstanding Section 10231.5, the department shall provide an annual report to the Legislature, in accordance with Section 9795, that includes all of the following information:
(a) The remaining unserved and disadvantaged areas in the state.
(b) The amount of moneys expended from the fund in the prior fiscal year.
(c) The recipients of moneys expended from the fund in the prior fiscal year.
(d) The geographic regions of the state affected by moneys expended from the fund in the prior fiscal year, including information by county.
(e) The expected benefits to be derived from the moneys expended from the fund in the prior fiscal year.
(f) Details on the status of each project funded by the program, including whether the project has been completed and, if not completed, the expected completion date of the project or completion percentage to date, and identification of project milestones.
(g) Actual broadband adoption levels resulting from the program in the prior calendar year.
(h) The number of formerly unserved households subscribing to broadband service in areas covered by projects funded under the program.
(i) The number of subscriptions resulting from the program.
(j) The amount of moneys expended from the fund to match federal funds and information on efforts to leverage moneys in the fund.
(k) The amount remaining in the fund and the projected amount to be dispersed each future fiscal year to fund approved projects.

101016.
 (a) The Department of Finance shall provide an independent audit of the expenditures made pursuant to this title.
(b) The director shall publish annually a list of all program and project expenditures under this title and shall post the list on its internet website.
(c) If an audit pursuant to subdivision (a) of an eligible entity receiving financial assistance under the program reveals any impropriety, the California State Auditor or the Controller may conduct a full audit of any and all activities of that eligible entity.
(d) The department shall require adequate reporting by an eligible entity receiving funding under the program of the expenditure of funds.

101017.
 Moneys provided under the program shall not be used by an eligible entity to acquire land by an eminent domain proceeding.

CHAPTER  3. Fiscal Provisions

101020.
 (a) (1) Subject to paragraph (2), bonds in the total amount of ten billion dollars ($10,000,000,000), not including the amount of any refunding bonds issued in accordance with Section 101029, may be issued and sold for the purposes expressed in this title and to reimburse the General Obligation Bond Expense Revolving Fund pursuant to Section 16724.5. The bonds, when sold, issued, and delivered, shall be and constitute a valid and binding obligation of the State of California, and the full faith and credit of the State of California is hereby pledged for the punctual payment of both principal of, and interest on, the bonds as the principal and interest become due and payable.
(2) Notwithstanding any other law, the bonds authorized by this title may only be issued and sold for three years following the date on which this title takes effect upon approval by the voters, after which date the Treasurer shall not issue or sell any amount of bonds authorized by this title but not issued. This paragraph shall not be construed to impair the validity of any bonds issued and sold before the date specified in this paragraph.
(b) The Treasurer shall issue and sell the bonds authorized in subdivision (a) in the amount determined by the committee to be necessary or desirable pursuant to Section 101023. The bonds shall be issued and sold upon the terms and conditions specified in a resolution to be adopted by the committee pursuant to Section 16731.

101021.
 (a) The bonds authorized by this title shall be prepared, executed, issued, sold, paid, and redeemed as provided in the State General Obligation Bond Law (Chapter 4 (commencing with Section 16720) of Part 3 of Division 4 of Title 2), as amended from time to time, and all of the provisions of that law apply to the bonds and to this title and are hereby incorporated in this title as though set forth in full in this title, except that subdivisions (a) and (b) of Section 16727 shall not apply.
(b) For purposes of this title, the references to “committee” in the State General Obligation Bond Law means the 2022 Broadband for All Finance Committee created in Section 101022, and the references to “board” in the State General Obligation Bond Law means the Department of Technology.

101022.
 (a) Solely for the purpose of authorizing the issuance and sale pursuant to the State General Obligation Bond Law of the bonds authorized by this title, the 2022 Broadband for All Finance Committee is hereby created.
(b) The committee consists of the Controller, the Treasurer, and the Director of Finance. Notwithstanding any other law, any member may designate a representative to act as that member in the member’s place for all purposes, as though the member were personally present.
(c) The Treasurer shall serve as chairperson of the committee. A majority of the committee may act for the committee.

101023.
 The committee shall determine by resolution whether or not it is necessary or desirable to issue and sell bonds authorized pursuant to this title in order to carry out the actions specified in this title and, if so, the amount of bonds to be issued and sold. Successive issues of bonds may be authorized and sold to carry out those actions progressively, and it is not necessary that all of the bonds authorized to be issued be sold at any one time.

101024.
 There shall be collected each year and in the same manner and at the same time as other state revenue is collected, in addition to the ordinary revenues of the state, a sum in an amount required to pay the principal of, and interest on, the bonds becoming due each year. It is the duty of all officers charged by law with any duty in regard to the collection of the revenue to do and perform each and every act that is necessary to collect that additional sum.

101025.
 Notwithstanding Section 13340, there is hereby continuously appropriated from the General Fund in the State Treasury, for the purposes of this title and without regard to fiscal years, an amount that equals the total of the following:
(a) The sum annually necessary to pay the principal of, and interest on, bonds issued and sold pursuant to this title, as the principal and interest become due and payable.
(b) The sum necessary to carry out Section 101027.

101026.
 The board may request the Pooled Money Investment Board to make a loan from the Pooled Money Investment Account, in accordance with Section 16312, for the purpose of carrying out this title less any amount withdrawn pursuant to Section 101027 and not yet returned to the General Fund. The amount of the request shall not exceed the amount of the unsold bonds that the committee has, by resolution, authorized to be sold for the purpose of carrying out this title, excluding any refunding bonds authorized pursuant to Section 101029, less any amount loaned pursuant to this section and not yet repaid and any amount withdrawn from the General Fund pursuant to Section 101027 and not yet returned to the General Fund. The board shall execute any documents required by the Pooled Money Investment Board to obtain and repay the loan. Any amounts loaned shall be deposited in the fund to be allocated by the board in accordance with this title.

101027.
 For the purposes of carrying out this title, the Director of Finance may authorize the withdrawal from the General Fund of an amount not to exceed the amount of the unsold bonds that have been authorized by the committee to be sold for the purpose of carrying out this title, excluding any refunding bonds authorized pursuant to Section 101029, less any amount loaned pursuant to Section 101026 and not yet repaid, and any amount withdrawn from the General Fund pursuant to this section and not yet returned to the General Fund. Any amounts withdrawn shall be deposited in the fund. Any moneys made available under this section shall be returned to the General Fund from proceeds received from the sale of bonds for the purpose of carrying out this title.

101028.
 All moneys deposited in the fund that are derived from premium and accrued interest on bonds sold pursuant to this title shall be reserved in the fund and shall be available for transfer to the General Fund as a credit to expenditures for bond interest, except those amounts derived from premium may be reserved and used to pay the cost of bond issuance before any transfer to the General Fund.

101029.
 The bonds issued and sold pursuant to this title may be refunded in accordance with Article 6 (commencing with Section 16780) of Chapter 4 of Part 3 of Division 4 of Title 2, which is a part of the State General Obligation Bond Law. Approval by the voters of the state for the issuance of the bonds described in this title includes the approval of the issuance of any bonds issued to refund any bonds originally issued under this title or any previously issued refunding bonds. Any bond refunded with the proceeds of refunding bonds as authorized by this section may be legally defeased to the extent permitted by law in the manner and to the extent set forth in the resolution, as amended from time to time, authorizing that refunded bond.

101030.
 Notwithstanding any other provision of this title, or of the State General Obligation Bond Law, if the Treasurer sells bonds pursuant to this title that include a bond counsel opinion to the effect that the interest on the bonds is excluded from gross income for federal tax purposes under designated conditions or is otherwise entitled to any federal tax advantage, the Treasurer may maintain separate accounts for the investment of bond proceeds and for the investment of earnings on those proceeds. The Treasurer may use or direct the use of those proceeds or earnings to pay any rebate, penalty, or other payment required under federal law or take any other action with respect to the investment and use of those bond proceeds or earnings required or desirable under federal law to maintain the tax exempt status of those bonds and to obtain any other advantage under federal law on behalf of the funds of this state.

101031.
 The proceeds from the sale of bonds authorized by this title are not “proceeds of taxes” as that term is used in Article XIII B of the California Constitution, and the disbursement of these proceeds is not subject to the limitations imposed by that article.

SEC. 2.

 (a) Section 1 of this act shall take effect upon the approval by the voters of the Broadband for All Act of 2022 set forth in Section 1 of this act.
(b) Section 1 of this act shall be submitted to the voters at the November 8, 2022, statewide general election in accordance with provisions of the Government Code and the Elections Code governing the submission of a statewide measure to the voters.
SECTION 1.

It is the intent of the Legislature to enact legislation that would enact the Broadband for All Act of 2022, to become operative only if approved by the voters at the November 8, 2022, statewide general election, to authorize the issuance of state general obligation bonds to fund increased access to broadband services to rural, urban, suburban, and tribal unserved and underserved communities, including to provide funding to close the digital divide faced by too many Californians.

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