Date: 03/25/2014

Final
BILL SUMMARY for HB14-1329

HOUSE COMMITTEE ON BUSINESS, LABOR, ECONOMIC, & WORKFORCE DEVELOPMENT

Votes: View--> Action Taken:
Adopt amendment L.001. The motion passed without o
Refer House Bill 14-1329, as amended, to the Commi		Pass Without Objection
PASS



01:57 PM -- HB 14-1329

Representative Williams and Representative Murray presented House Bill 14-1329, concerning the exemption of certain internet-protocol-enabled services from oversight by the Colorado Public Utilities Commission (PUC). This bill deregulates certain telecommunication products, services, and providers. Specifically, the bill eliminates the authority of the PUC, in the Department of Regulatory Agencies, to regulate:

The bill also amends and adds statutory definitions for certain telecommunication products, services, and providers subject to regulation and exempt from regulation. Finally, the bill clarifies that it does not affect the scope or effect of PUC authority relative to the wholesale telecommunications market, federal telecommunications programs, or basic emergency service (commonly known as 9-1-1).

The following individuals testified on the bill:

01:58 PM -- Bill Levis, representing AARP, testified in opposition to HB 14-1329, HB 14-1331, and HB 14-1328. Mr. Levis discussed his previous work experience involving consumer advocacy and utilities regulation. He stated that the AARP is concerned that the bills do not offer enough consumer protections. He discussed the issue that VoIP-based phones do not pay for Telecommunications Relay Service (TRS), the telephone services that allows persons with hearing or speech difficulties to receive a call, and the issue that telecommunications customers using a VoIP service will not pay into the High Cost Fund. He discussed the court opinions in Verizon v. Federal Communications Commission (FCC) as it relates to the bills.

Mr. Levis stated the AARP's findings that deregulation has not yet caused consumer rates to go down, and discussed the rate increase trends in other states after similar legislation has passed. He discussed the importance of maintaining the High Cost Fund and stated that there are three funding sources already in place to deploy broadband, including: the federal Farm Bill, the Connect America Fund, and EagleNet. He cited FCC Commissioner Michael O'Rielly's March 6 blog post entitled "Duplication Alert: Broadband Pilot Projects." Mr. Levis mentioned that there are other telecommunications industries based in the state, including Dish Network, Liberty Media Corporation, Level 3 Communications, and the Zayo Group.

02:08 PM

Mr. Levis began responding to questions from the committee. Representative Kraft-Tharp asked him to explain his statements that cell phones do not work and that the bills will get rid of landlines. He discussed the concerns the hearing impaired population has with cell phones. He discussed AT&T's stated goal to be an all-wireless network by 2020 and the FCC's trials of the impact of technology transitions. Mr. Levis stated that the current telecommunications atmosphere in the state is competitive, thriving, and that nothing needs to be done. He cited the Prism surveillance program as an additional reason to be concerned about all-wireless technology.

Representative Kraft-Tharp asked the witness to clarify his remarks about landlines. Mr. Levis stated that the telecommunications in Colorado are focusing on digital products, not on basic service. He stated his concern that there are no incentives in the bills to keep landlines. He cited the precedence set in other states where telecommunications have been deregulated, that these states do not reregulate. Mr. Levis stated that deregulation is not necessary. He said that the bill is rushed, driven by the industry, and that consumers were not involved in the stakeholder process, including AARP. In response to a question from Representative Rosenthal, he discussed the FCC trials further.

02:16 PM -- Katie Fleming-Dahl, representing Colorado Common Cause, testified in opposition to HB 14-1329, HB 14-1331, and HB 14-1328. Mr. Fleming-Dahl discussed the purpose of her organization. She stated that VoIP should be regulated the same as telephone exchanges. She stated that telephone service needs to be available and reliable. She stated that it was a mistake to codify deregulation. She said that if VoIP is to replace landline service, then the standards that regulate landline services should be transferred over to VoIP service. Ms. Fleming-Dahl discussed her organization's concerns around 9-1-1 service, stating that VoIP does not guarantee correct call routing and address recognition. She said that HB 14-1329 maintains the same level of protections for 9-1-1 basic service, but that the same level of protections should exist for VoIP service. She stated that consumer protections should come with the transition to VoIP service. On HB 14-1331, Ms. Fleming-Dahl discussed a Demos survey which reported rate increases from 8 percent to 100 percent in states that deregulated telecommunications, and also noted the up to 400 percent rate increases of some California telecommunications providers post-deregulation. She discussed a Colorado Fiscal Institute report that indicated high levels of economic inequality in Colorado, and stated her organization's concern that these bills may price the senior and low-income populations out of communication. She stated that the removal of the Carrier of Last Resort requirement was dangerous, particularly in crisis situations. Ms. Fleming-Dahl discussed HB 14-1328, and stated that there are other funding mechanisms in place for broadband build-out. She said that local governments would benefit from the repeal of the law that keeps them from building broadband independently.

02:24 PM -- Patricia Yeager, representing The Independence Center and the Colorado Cross-Disability Coalition, testified in opposition to the bill. Ms. Yeager discussed her hearing impairment and stated that she is dependent on landline service to be connected to the world and to be able to hear the person on the other side of the call. She discussed her participation in the efforts to make cellphones accessible for the hard of hearing. Ms. Yeager stated that, in her experience, landlines provide a clear ringtone, but that she does not hear her cellphone when it rings. She discussed her experience living through the Waldo Canyon Fire and discussed the problems with cellphones in crisis. She stated that she requires both a cellphone and landline to make her feel safe living in Cheyenne Canyon. She stated her opinion that the technology behind next generation (NextGen) 9-1-1 is not yet a viable replacement for 9-1-1 as we know it. She asked the committee to consider three points: cellphones do not have adequate accessibility for the deaf and hard of hearing; NextGen 9-1-1 is not tested enough for large-scale crises; and that the PUC needs to have regulatory authority to ensure these provisions are in place before the funding mechanisms for basic service and TRS are pulled. Ms. Yaeger responded to a question from Representative Exum on the bill's language around 9-1-1 service.

02:32 PM -- Erik Mitisek, representing the Colorado Technology Association, testified in support of the bill. He discussed the importance of IP infrastructure to the state's economy and responded to questions from the committee. Representative Ryden asked the witness to speak to the concerns about the bills' impact on landlines. He offered an analogy likening the telecommunications transition to VoIP to the introduction of the telegraph. Reprsentative Kraft-Tharp asked the witness to address previous witnesses' concerns about 9-1-1 and accessibility. Mr. Mitisek discussed the work being done in the medical services devices industry in catching up to VoIP; he stated that innovative products will be coming to the market to solve that gap. He discussed the current conversation around Food and Drug Administration approval of these devices. Mr. Mitisek addressed the concerns around 9-1-1, stating that the telecommunications industry depends on their success in 9-1-1 and that self-regulation has been successful in that area. He brought up the example of how the FCC has been instrumental in solving regulatory telecommunications issues, like the transfer of a consumer's phone number when that consumer changes their carrier. Representative Williams discussed the avenues still available to telecommunications consumers. Representative Rosenthal asked a question about the telegraph comparison, and referenced historical problems with consumer protection in the face of large businesses. Representative Murray reminded the committee that VoIP is not currently regulated. She stated that Mr. Mitisek made a good point around the FCC's regulatory authority. She stated that that there is nothing in this bill that cannot be changed in future sessions if the legislature finds problems with the way telecommunications industries are operating in the state.

02:50 PM -- Michael Price, representing the Coalition for a Connected West, testified in support of the bill. Mr. Price stated that the bill package will encourage investment in underserved areas of the state. He said the telecommunications conversation was an important one for the state to be having, because internet access has a tremendous impact on the state's economy. Mr. Price responded to questions from the committee about 9-1-1 and accessibility. He stated that consumers can rely on the FCC to work with providers to ensure a smooth transition.

02:58 PM -- Milt Doumit, representing Verizon, testified in support of the bill and offered to take questions from the committee. Representative Exum asked Mr. Doumit to address the issues of hearing impairment. He stated that the telecommunications market is explosively competitive, and discussed the current applications available to perform text-to-voice and text-to-braille functions.

03:00 PM -- Joe Benkert, representing the Boulder Regional Emergency Telephone Service Authority, testified neutrally on the bill. He discussed the bill's treatment of emergency service and discussed the 9-1-1 landscape in the state. Representative Williams responded to a question from the witness about the bill's intent around emergency service. She stated that she believes the language maintains status quo and PUC will maintain the same authority it has today to regulate 9-1-1.

3:05 PM

Representative Williams distributed and discussed Amendment L.001 (Attachment A) which would allow the PUC regulatory authority over "slamming," where a subscriber's telephone service is changed without their consent.

140325 AttachA.pdf140325 AttachA.pdf
BILL:HB14-1329
TIME: 03:07:40 PM
MOVED:Williams
MOTION:Adopt amendment L.001. The motion passed without objection.
SECONDED:Exum
VOTE
Exum
Hamner
Holbert
Navarro
Nordberg
Rosenthal
Ryden
Szabo
Wright
Kraft-Tharp
Williams
YES: 0 NO: 0 EXC: 0 ABS: 0 FINAL ACTION: Pass Without Objection



03:08 PM

The sponsors made closing remarks.

BILL:HB14-1329
TIME: 03:09:03 PM
MOVED:Williams
MOTION:Refer House Bill 14-1329, as amended, to the Committee on Appropriations. The motion passed on a vote of 10-1.
SECONDED:Hamner
VOTE
Exum
Yes
Hamner
Yes
Holbert
Yes
Navarro
Yes
Nordberg
Yes
Rosenthal
No
Ryden
Yes
Szabo
Yes
Wright
Yes
Kraft-Tharp
Yes
Williams
Yes
Final YES: 10 NO: 1 EXC: 0 ABS: 0 FINAL ACTION: PASS