California Assembly Bill AB2545 Latest Draft

 BILL NUMBER: AB 2545AMENDED BILL TEXT AMENDED IN SENATE AUGUST 17, 2010 AMENDED IN SENATE JUNE 22, 2010 INTRODUCED BY Assembly Member De La Torre FEBRUARY 19, 2010 An act to add Section 41127.9 to the Revenue and Taxation Code, relating to telecommunications. LEGISLATIVE COUNSEL'S DIGEST AB 2545, as amended, De La Torre.  Emergency Telephone Users Surcharge Act: prepaid mobile telecommunications service.   Prepaid communications services: taxes: fees: surcharges: report.   Existing provisions of the Warren-911-Emergency Assistance Act establish the number "911" as the primary emergency telephone number of use in the state. The existing Emergency Telephone Users Surcharge Act generally imposes a surcharge on amounts paid by every person in the state for intrastate telephone service that is imposed at a percentage rate, not less than 0.5% nor more than 0.75% as annually estimated to provide revenues sufficient to fund "911" emergency telephone system costs for the current fiscal year. Surcharge amounts are paid to the State Board of Equalization on a monthly basis by the telephone service supplier and are deposited into the State Treasury to the credit of the State Emergency Telephone Number Account in the General Fund. Under   Under  existing law, the Public Utilities Commission (PUC) has regulatory authority over public utilities, including telephone corporations, except to the extent regulation of commercial mobile radio service is preempted by federal regulation. This bill would require the PUC  to open proceedings or expand the scope of existing proceedings to determine an equitable manner for collection of the surcharge from users of prepaid mobile telecommunications services, and would require the PUC to advise the board of its determination   , within 60 days of the effective date of the bill, to   conduct a public process to consult with, and hear comments from, interested parties, as described, for the purpose of developing recommendations for an equitable and uniform method of collecting state and local communications taxes, fees, and surcharges from prepaid communications end-user consumers, and to report those recommendations to the Legislature.  This bill would also make legislative findings and declarations regarding equitable contributions to the funding of  911 systems   state and local communications services and programs  by consumers of prepaid  mobile telecommunications   communications  services. Vote: majority. Appropriation: no. Fiscal committee: yes. State-mandated local program: no. THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:  SECTION 1.   (a) The Legislature finds and declares all of the following:   (1) Maintaining effective and efficient telecommunications services, 911 systems, and telecommunications-related public policy programs across the state benefits all citizens.   (2) Communications taxes, fees, and surcharges, including the Emergency Telephone Users Surcharge, state public policy program surcharges, and local 911 fees and utility user taxes are important funding mechanisms to assist state and local governments with the deployment of a variety of important communications services and programs to the citizens of this state.   (3) Prepaid communications services are an important and growing segment of the communications industry.   (4) Providers of communications services are required to collect and remit communications taxes, fees, and surcharges on various types of communication service revenues, as provided by existing state or local law.   (5) Under existing law there is a method for collecting communications taxes, fees, and surcharges from postpaid communications end-user consumers. However, there is no uniform method for collecting communications taxes, fees, and surcharges from prepaid end-user consumers.   (6) Consumers purchase prepaid communications services at a wide variety of retail locations and other distribution channels, as well as through service providers.   (7) To ensure equitable contributions to the funding of state and local communications services and programs from end-user consumers of prepaid communications services, there should be standardization with respect to the method used to collect communications taxes, fees, and surcharges from end-user consumers of prepaid communications services.   (b) It is the intent of the Legislature in enacting this act to provide for an interested parties process under the direction of the Public Utilities Commission to develop recommendations for an equitable and uniform method of collecting communications taxes, fees, and surcharges from end-user consumers of prepaid communications services. Because collection and administration of communications taxes, fees, and surcharges falls within the jurisdiction of multiple state and local public entities, and establishing a uniform method of collecting these taxes, fees, and surcharges from prepaid communications end-user consumers could significantly affect a variety of industry sectors, it is the intent of the Legislature that the interested parties process include regularly scheduled meetings with, and opportunities to comment from, stakeholders, including representatives from affected government entities and industry sectors.   SEC. 2.   Section 41127.9 is added to the   Revenue and Taxation Code   , to read:   41127.9. (a) No later than 60 days after the effective date of the act adding this section, the Public Utilities Commission shall conduct a public process for the purpose of developing recommendations for an equitable and uniform method of collection for state and local government imposed communications taxes, fees, and surcharges from prepaid communications end-user consumers. This process shall consist of regularly scheduled meetings and shall provide a reasonable opportunity to comment on oral and written recommendations before they become final. The Public Utilities Commission shall report its recommendations to the Legislature no later than 18 months from the date upon which the interested parties process has convened. (b) (1) For the purposes of this section, "communications taxes, fees, and surcharges" means any and all taxes, fees, and surcharges on communications services imposed or authorized by the state or a local government, including, but not limited to, all of the following: (A) The State Emergency Telephone Users Surcharge (SETUS). (B) The California High Cost Fund-A (CHCF-A) Administrative Committee Fund Surcharge. (C) The California High Cost Fund-B (CHCF-B) Administrative Committee Fund Surcharge. (D) The California Advanced Services Fund (CASF) Surcharge. (E) The California Teleconnect Fund (CTF) Surcharge. (F) The Deaf and Disabled Telecommunications Program (DDTP) Surcharge. (G) The Public Utilities Commission Reimbursement Account (PUCRA) Surcharge. (H) The Universal Lifeline Telephone Service (ULTS) Surcharge. (I) Any 911 tax, fee, or surcharge. (J) Any local utility users tax imposed by a local government. (2) For purposes of this section, "prepaid communications" includes both prepaid calling card telephone service and prepaid wireless service. (c) The Public Utilities Commission shall provide notification of, and an invitation to participate in, the interested parties process established in this section to interested parties, including, but not limited to, a representative or representatives of all of the following: (1) The State Board of Equalization. (2) The State Chief Information Officer. (3) The Controller. (4) The Department of Finance. (5) Local governments. (6) Local law enforcement agencies. (7) The wireless, wireline, and cable communications industries, including the CTIA-The Wireless Association, the California Communications Association, and the California Cable and Telecommunications Association. (8) Taxpayers and general industry, including the California Taxpayers' Association and the California Chamber of Commerce. (9) The retail industry, including the California Retailers Association. (10) Consumer representatives and consumer advocacy organizations, including the Utility Reform Network and the Division of Ratepayer Advocates. (11) Any other public or private entities as deemed appropriate by the Public Utilities Commission. (d) The interested parties process and development of recommendations shall include, but shall not be limited to, consideration of all of the following: (1) The mechanism for collection of communications taxes, fees, and surcharges. (2) The point of collection of communications taxes, fees, and surcharges. (3) The appropriate entity or entities to collect the communications taxes, fees, and surcharges and distribute the revenues to the appropriate account. (4) The costs of administration for state government, local governments, and industry sectors. (5) The date or dates on which the recommendations should take effect. (e) (1) A report to be submitted pursuant to subdivision (a) shall be submitted in compliance with Section 9795 of the Government Code. (2) The requirement for submitting a report imposed under subdivision (a) is inoperative on September 1, 2016, pursuant to Section 10231.5 of the Government Code.   SECTION 1.   (a) The Legislature finds and declares the following: (1) Maintaining effective and efficient 911 systems across the state benefits all citizens. (2) 911 fees imposed upon consumers of communications services that have the ability to dial 911 are an important funding mechanism to assist state and local governments with the deployment of enhanced 911 services to the citizens of this state. (3) Prepaid mobile telecommunications services are an important segment of the communications industry and should bear an equitable part of the responsibility for the funding of the 911 system. (4) Consumers purchase prepaid mobile telecommunications services at a wide variety of retail locations and other distribution channels, as well as through service providers. (5) To ensure equitable contributions to the funding of 911 systems from consumers of prepaid mobile telecommunications services, there should be clarity and standardization with respect to the collection and payment obligations of 911 surcharges for prepaid mobile telecommunications services. (6) Current law also requires several public purpose surcharges and user fees to be collected from end users and remitted to the Public Utilities Commission. (7) The Public Utilities Commission has the body of experience and comparative advantage over the State Board of Equalization regarding the collection of surcharges for prepaid communications services.   SEC. 2.   Section 41127.9 is added to the Revenue and Taxation Code, to read: 41127.9. (a) The Public Utilities Commission shall open proceedings or expand the scope of existing proceedings to determine an equitable manner for collection of the surcharge from users of prepaid mobile telecommunications services. The commission shall advise the State Board of Equalization of its determination. (b) For purposes of this section, all of the following shall apply: (1) "Prepaid mobile telecommunications service" means a telecommunications service or product that must be paid for in advance that provides the right to utilize mobile telecommunications service and that is sold in predetermined units or dollars of which the number declines with use in a known amount. (2) "Mobile telecommunications service" means commercial mobile radio service, as defined in Section 20.3 of Title 47 of the Code of the Federal Regulations, as in effect on June 1, 1999.