Ren Art 11 §§4000, 4001 & 4002 to be Art 12 §§4200, 4201 & 4202, add Art 11 §§4100 - 4120, §2808, Pub Auth L;
amd Pub Serv L, generally; add §32-a, Exec L
Enacts the "omnibus telecommunications reform act"; reforms the competitive cable service; promotes the wide-spread development of high-capacity broadband internet access; increases the availability and quality of services in this key economic development area; ensures the safety, reliability and affordability of telecommunications services.
NEW YORK STATE ASSEMBLY MEMORANDUM IN SUPPORT OF LEGISLATION submitted in accordance with Assembly Rule III, Sec 1(f)
BILL NUMBER: A7509
SPONSOR: Pretlow TITLE OF BILL:
An act to amend the public authorities law, the public service law, and
the executive law, in relation to reforming the telecommunications
sector of the New York economy, by creating a broadband authority,
authorizing statewide cable franchises for the purposes of competitive
cable service, promoting the wide-spread development of high-capacity
broadband internet access, and increasing the availability and quality
of services in this key economic development area and ensuring the safe-
ty, reliability and affordability of telecommunications services
PURPOSE OR GENERAL IDEA OF BILL:
This bill makes fundamental reforms in the ever-changing world of tele-
communications to guarantee that residents of New York are provided with
universal access to telecommunications services at just and reasonable
rates, while requiring telecommunications companies to make investments
in telecommunications infrastructure and adequate staffing.
SUMMARY OF SPECIFIC PROVISIONS:
§ 1. Short Title. This Act shall be known as the "Omnibus Telecommuni-
cations Reform, and Consumer Protection Act of 2019.
§ 2. Legislative Findings.
§ 3. Amends the public authorities law by adding Article 11 to create
the New York State Broadband Development Authority.
§ 4. Amends the public service law by adding a new section 92-h to
create the Universal, Affordable and Secure Telecommunications Services
Fund.
§ 5. Amends the public authorities law by adding a new article 11-A to
create a statewide cable franchise.
§ 6. Amends § 215 of the public service law to require that cable fran-
chises submit a "neutrality report."
§ 7. Amends § 99 of the public service law by adding a new section on
anti-discrimination of service provisions.
§ 8. Amends the general business law by adding a new section 349-b-1 on
VOIP 911 disclosure.
§§ 9-10. Amends the public service law on telecommunications mergers.
§ 11. Amends the executive law on State Agency Telecommunications
Resource Management.
§ 12. Amends the executive law on State Authorities Telecommunications
Resource Management.
§ 13. Amends the public service law to require that the PSC complete a
study on the effects of telecommunications mergers on universal service.
14. Amends the public service law to require that the PSC complete a
study on the effects of any proposed sale of telecommunications networks
on universal service. § 15. Amends the public authorities law to require
a report on Broadband Deployment.
§ 16. Amends the public service law to require the PSC perform a study
on 911 Emergency Services. study on consumer protections in wireless
telecommunications services.
§ 18 Amends the public service law to study and then implement service
quality standards for all telecommunications providers.
§ 19. Applicability of other law.
§ 20. Severability.
§ 21. Effective date.
JUSTIFICATION:
The State has a responsibility, as a matter of public safety and consum-
er protection, to promote safe, reliable and affordable telecommuni-
cations services. This bill, therefore, has several goals including:
*guaranteeing that all New Yorkers are offered quality telecommuni-
cations services at just and reasonable rates;
*bridging the ever-widening chasm of the digital divide in rural, high-
cost and low income areas;
*promoting the deployment of high-capacity broadband networks throughout
New York State through the use of public-private partnerships which will
help to remove the barriers to development of universally deployed
world-class high-capacity broadband networks; and
* increasing competition in cable television services across the State,
resulting in increased investment in the state, lower prices and
* improved service offerings for consumers, while still preserving
municipal power to manage public rights of way and their ability to
collect a franchise fee and administer Public Education and Government
access channels.
To reform the telecommunications industri, in New York State to ensure
consumer protections and public safety by providing telecommunications
access for all New Yorkers, we need a strong and fundamental reform of
the entire system. This bill begins that process. A comprehensive plan
is needed to lead the State into the next phase of telecommunications.
This comprehensive legislation is a start to that process. Specific
provisions are described below.
I. BROADBAND DEPLOYMENT AUTHORITY/MAPPING Broadband technologies, which
enable the high-speed transmission of electronic information, play a
fundamental role in the State's economy. These broadband services are
essential for electronic commerce and telecommuting, and are critical
for 21st century learning and medicine. However, broadband technologies
are not evenly dispersed and utilized among the state's citizens. Rural,
inner-city, and low-income households may be unable to reap the benefits
of broadband access. In order to develop a strategy for encouraging the
cost-effective deployment of broadband technologies in the state, the
legislature intends to identify factors preventing the widespread avail-
ability and use of broadband technologies.
This bill will guarantee adequate service quality by telecommunications
and cable companies in rural, high-cost and low income areas. Often
social access is just as important as physical access. In other words,
even as broadband is deployed, the costs are so high that most citizens
cannot afford to use the technology. Such a cost prohibitive deployment
must be addressed.
As other states have found, due to the complexity and expense of estab-
lishing universal broadband access, the creation of a new public author-
ity is necessary. This public authority, the Broadband Deployment
Authority, will manage, regulate, and assist with funding of the wide
array of infrastructure enhancement projects necessary for universal
broadband access. This is not a new concept as other states have already
moved ahead with the creation of similar public authorities. Virginia
created the Innovative Technology Authority with an operational arm
known as the Center for Innovative Technology. The Authority has powers
to promote various technology projects' and is authorized to disburse
funds to broadband enhancement projects throughout the state.
The Innovative Technology Authority/Center for Innovative Technology is
considered nation-wide model for broadband deployment authorities.
ConnectKentucky was based off these institutions and has made impressive
strides in its effort to establish 100 Broadband availability throughout
their home state by the end of 2007. Maine has created the ConnectME
authority tasked with establishing universal broadband access in that
state, with power to designate and redesignate base-level broadband
access speeds, designate un- and under-served areas, distribute funds,
and level assessments on telecommunications providers to support those
fundL By creating this authority, and the requisite broadband infras-
tructure the economic future of New York will be greatly enhanced.
However, in order to deploy broadband to the places in greater need, the
State needs a comprehensive system of mapping. Therefore, the Empire
State Development Corporation and the Public Service Commission, in
conjunction with the Geographic Information Services Clearinghouse of
the Office of Cyber Security and Critical Infrastructure Coordination
will be appropriated $250,000 to complete a survey of broadband avail-
ability in New York State. The survey shall collect and inter part
statistically reliable geographic, demographic, and telecommunications
technology information to identify any broadband deployment disparities
in the state. The survey shall also produce a statistically reliable
profile of the following: Households and businesses in the state with no
available broadband options; Households and businesses in the state with
access to broadband options, but who choose not to purchase an option;
and Purposes for which broadband is used by households and businesses in
the state. The survey will be conducted at the census tract level or
such smaller administrative units as is reasonable. After the initial
survey is complete, the Empire State Development Corporation, Public
Service Commission; and the Geographic Information Services Clearing-
house will provide updates every six months to track the expansion and
progress of broadband access across the State.
II. COMPETITION OF CABLE TELEVISION SERVICES
The State has a responsibility to promote adequate, affordable and effi-
cient cable services to its residents and encourage the optimum develop-
ment of community-service potentials of the cable television medium.
Technology is ever-changing and it is imperative that the State of New
York allows for many sources of technological competition to provide the
goal of adequate and affordable cable services to residents. This Act is
a step in providing a balanced approach to providing consumers cable
choice and allowing for areas of the State to have access to developing
broadband technologies. Currently, other states have enacted laws to
provide choice for cable service including: California, Indiana, New
Jersey, Michigan, Kansas, North Carolina, South Carolina, Texas and
Virginia.
Other states have also moved statewide franchise bills through the
legislative process including Pennsylvania, Connecticut, Georgia,
Missouri, New Hampshire and Tennessee, among others. Contrary to various
reports, this bill protects all municipal power, save the power to
approve the franchise, and sets the fees, public access and other social
protections at a ceiling so that municipalities, community groups and
other interested parties have the most progressive and comprehensive
franchise possible. In the end this section is to protect the consumer
and strengthen the economy, while preserving locality's power to regu-
late franchises. The GAO, FCC and other studies show that only statewide
franchises cause rate reductions of 20-25%. In addition, Towns, cities
and villages will receive a 4031 increase in payments from cable compa-
nies.
A. ADDITIONAL CONSUMER AND LOCAL GOVERNMENT: PROTECTIONS
While other states have enacted laws to provide choice, this bill would
require other important protections to protect local input, community
input, citizen access to television channels, the free flow of ideas and
information on broad-brand networks and other consumer protections This
is the most progressive statewide cable franchise in the country that
will protect consumers, bring choice, protects the power of munici-
palities and require social responsibility on behalf of cable providers.
1. It maintains and exceeds financial commitments to local governments.
The Ant has a progressive franchise fee schedule that includes a 5%
franchise fee, free cable and Internet service to municipal buildings
and agencies and a separate fund to maintain and build quality PEG chan-
nels. Finally, tax loopholes and other financial gimmicks used by the
cable companies to reduce municipal payments are outlawed.
2. It maintains municipal oversight to tailor the provider's commitment
to the community's needs. The Statewide franchise will allow munici-
palities the various powers to retain all their historic powers includ-
ing:
*The power of municipalities to exercise its power over public rights of
way;
*Receive, mediate and resolve cable service quality complaints from a
franchise holder's customers within the municipality;
*Require a franchise holder who is providing cable service within the
municipality to register with the municipality, maintain a point of
contact, and provide notice of any franchise authorization transfer to
the municipality within fourteen business days after the completion of
the transfer; and
*Establish guidelines regarding the use of, public, educational, and
governmental access channels within the municipality.
3. It protects and allows for progressive public access. In many parts
of the State, PEG channels are woefully inadequate in providing access
and programming opportunities to citizens. This bill would create a
strong system of PEG channels for it provides the necessary funding and
channel space. The Act will require that the current regulations govern-
ing PEG channels be followed including additional PEG channels and
services not contained in the current regulations. For example every
statewide franchise will have to allot analog channels of six megahertz
bandwidth. In addition, the Act would create a separate fund specif-
ically for PEG channels to maintain a reliable service and community
network. This is the most progressive language in the State or country.
4. It requires a continued commitment to the community. The Act will
require cable operators to provide free cable and high speed Internet
service to hospitals, schools, firehouses and other important
community/municipal organizations. In addition, the Act includes anti-
redlining provisions. If the PSC finds that a cable operator is redlin-
ing, the Commission may terminate the franchise as well as impose fines
and Penalties on the cable operator.
B. REQUIRING COMPANIES TO PROVIDE COMPETITIVE SERVICES AND STOPPING THE
"CHERRY PICKING" PROBLEM-et
Contrary to various reports, this Act would mandate that cable operators
fulfill their obligation to provide choice by requiring certain build
out dates as well as impose fines to any company that is found to
discriminate against a class or race of people by not providing service
to communities. Specifically, any evidence of redlining by a company
results in significant penalties.
This bill will require that the franchisee provide service to a majority
of New Yorkers to ensure that competition is offered throughout the
State. This bill would require that any statewide franchise provide:
service to over half the State's consumers (including in the upstate,
western, central and downstate portion of the State) within three years
of receiving a statewide franchise, and service to over 85% of New York-
ers within five years. This is among the most progressive deployment
requirements in the country.
C. WHY THE NEED FOR THE STATEWIDE FRANCHISE?
It has been argued that there is no need for a statewide franchise
because any company can file for a local franchise now and further, that
it is unfair to companies that have had to file for local franchises to
now compete with a state- wide model. However, the technology and market
has changed considerably since the first cable franchises. It took years
for cable companies to offer cable service and broadband service to the
entire State, so a local franchise-by-local franchise approach will not
deploy and create the competitive market that consumers deserve. More-
over, a review of franchises throughout New York has shown that many
municipalities get shortchanged. This bill sets protects municipalities
by statutorily. requiring the financial and community incentives that
are needed in franchises. Finally, and most importantly, in the end the
consumer wins because of lower cable rates.
D. THE STATEWIDE FRANCHISE PROVIDES CHOICE, CREATES COBS AND SPURS THE
ECONOMY
The Cable Choice Act provides residents all the consumer protections and
statutory requirements for adequate, efficient and affordable service
while providing choice of service providers. This carefully constructed
legislation will promote and facilitate the deployment of advanced tech-
nologies and new reliable and affordable services to all classes and
communities and protect New York's ability to compete in the national
and international marketplace for industry and jobs.
III. PROTECTING THE NEUTRALITY OF THE INTERNET
The proposal includes net neutrality language - whereby networks would
not be able to favor one particular network destination or class of
applications over others--to ensure that the free flow of ideas of the
Internet. Although the Federal Government has eliminated net neutrality
rules, the State has every right and obligation to build this important
consumer protection in as a condition of a new model of cable and broad-
band deployment.
Net Neutrality is not in itself a new idea. Its roots date back to the
1050's with Common Carrier legislation for telegraphs; Those laws made
it unlawful for anyone owning or operating a telegraph line to refuse to
receive dispatch from any other company or person owning or operating
any telegraph line in the state, or refuse or willfully neglect to tran-
smit the same in good faith, without partiality. The offense would
result in the forfeiture of all right and franchises associated with
telegraph transmission in the state.
In 2005 the Federal Communications Commission incorrectly decided that
common carrier status need not apply to telecommunication providers.
There is no logical reason to overturn statutes that have worked for
over 140 years, Our legislation will update an existing statute in order
to ensure consumer protection and public safety by providing equal tele-
communications access for all New Yorkers.
IV. PROTECTING 911 EMERGENCY SERVICES
This legislation also protects and will require the further enhancement
of 911 emergency services. The ability to call 911 during an emergency
saves lives everyday in New York State. Many New Yorkers who use VoIP
(Internet phone service) as their primary phone assume that emergency
911 works the same for VoIP phones as traditional phones, but this is
mostly not the case, Consumers must be made aware of any limitations of
their 911 service before an emergency occurs. Disclosure of the limits
of VoIP's 911 services will allow New Yorkers to avoid the tragedies
that have occurred in other states when customers wrongly believed that
VoIP would work the same as traditional phone service when placing a
call to 911. For example, in Texas a child recently witnessed a violent
crime in her home, but was unable to access 911 emergency services from
the family's VoIP telephone, The Attorneys General of the States of
Michigan and Texas have brought suit against the largest provider of
VoIP telephony to require it to fully disclose the limitations of such
services to current and prospective customers.
Furthermore, New York's existing Enhanced 911 (E911) system greatly
enhances public safety by automatically identifying the caller's phone
number and location. Nearly all consumers with traditional wireline
Phone service and most consumers with wireless cellular phones currently
have access to E911. However, outside of New York City, most VoIP
subscribers do not enjoy the benefits of E911. With an increasing number
of New Yorkers using VoIP phones, it is important that the State studies
the technological challenges facing the extension of E911 to VoIP
services and other issues that could degrade the effective ness of New
York's E911 networks in the future. E911 services are essential to the
public safety of all New Yorkers. E911 is distinguished from tradi-
tional 911 in that it provides the Emergency Operators the caller's
phone number as well as their location. As such it is necessary for New
York State to perform a comprehensive study to ascertain the current
availability and reliability of its 5911 services. As the telecommuni-
cations industry migrates from copper wire-based infrastructure to fiber
optic-based infrastructure, it is equally important that New York take
steps to safeguard the current availability and reliability of E911
while looking secure and expand the service with new and emerging tech-
nologies. After such a study is performed, the public will be better
informed of the policy issues surrounding E911 as well as possible
legislative actions necessary to ensure its availability.
V. ANNUAL TELECOMMUNICATIONS RESOURCES REPORTS BY AUTHORITIES AND AGEN-
CIES
Wide access to broadband services will serve the nubile interest and
promote economic development within New York State. This section will
have public authorities and agencies lease on a non-discriminatory and
commercially reasonable basis any excess capacity or bandwidth under
their control to public entities or certified telecommunications carri-
ers. This excess capacity will then be used to provide broadband
services to unserved, underserved, and distressed areas. This section
will also have public authorities_ and agencies report on the telecommu-
nications services they use that may be used in a telecommunications
demand aggregation program administered by the State Broadband Deploy-
ment Council created in•this legislat ion. Finally, this section will
require each public authority and agency to post on its website documen-
tation on the telecommunications infrastructure resources controlled by
the authority and agency.
It is wasteful for public authorities and agencies to let excess capaci-
ty go unused when it can be leased to public entities or telecommuni-
cations carriers in order to increase broadband access to under served
areas.
VI. PROTECTING UNIVERSAL SERVICE AND THE LEGACY SYSTEM
While new telecommunications technologies emerge daily, many New Yorkers
are forced to rely on the legacy system. New Yorks historic responsibil-
ity was and is to provide universal service at just and reasonable
rates. The Federal government has defined universal service as being
composed of the following parts: the high-cost support mechanism; the
low-income support mechanism; the rural healthcare support mechanism;
and the "E-Rate" which helps to provide telecommunications access to our
schools and libraries. New York currently provides minimal assistance to
elderly persons with help paying their phone bills as well as telecommu-
nications relay services (TRS) to the hearing impaired. New York does
not provide any E-Rate assistance beyond what it receives in federal
moneys. This situation is unacceptable. As part of a holistic approach
to reforming the telecommunications industry, implementation of all four
federal aspects of the universal service fund is necessary, as well as
expanding that definition to include high-speed broadband access to
unserved and underserved areas.
As demonstrated in the by Committee's various public hearing and inves-
tigations into Verizon's declining service quality,•it is necessary for
comprehensive reform of the telecommunications industry. Relying on
market forces to regulate the industry (legacy or burgeoning networks)
has so far proved inadequate. As the industry migrates from aging copper
wire networks to new, high capacity fiber-optic cables it is imperative
that the State have a free hand to regulate the industry. Through new
regulations the State can ensure service quality that will provide
instant access to emergency phone and Internet services throughout the
infrastructure transition and beyond.
Evaluating' service quality should encompass a wide number of criteria;
the length of time needed to repair out of service reports, wait times
for customer service phone calls, the time needed for installations,
missed repair appointments, and more. Along with Assembly Tonko's
service quality proposal, this legislation takes several steps to ensure
adequate service quality for New Yorkers. It requires the Public Service
Commission to issue reports that evaluate the impact of the sale or
transfer of the capital stock of telephone corporations on service qual-
ity in the relevant area along with looking at the impact on prices and
network, reliability. The bill also empowers a municipal government to
mediate cable television service quality complaints within the munici-
pality.
Thus, in order to accomplish the goals of universal service, it is
imperative that a system of support mechanisms remain in place and is
expanded to burgeoning technologies. for high-cost areas. The legis-
lation expands universal service to promote the goal of ensuring that
telecommunications consumers in New York have generally and readily
availa ble and, reasonably priced access to broadband telecommunication
services and other advanced communications services in a fair and non
discriminatory procedure.
Additional measures are needed to ensure that the State fulfills its
responsibility of providing universal service. First, the Public Service
Commission must approve of any sale, lease, or other form of acquisition
of said infrastructure, before that transaction can be finalized.
Approval of any transaction is contingent on the Public Service Commis-
sion's findings that the transaction will be in the public interest and
meet standards described in statute.
Second, the State must take a bard look at any sale of part of the lega-
cy system. Recently Verizon has sold off portions of their networks in
New Hampshire, Connecticut and Vermont. As recently as 2005, reports
surfaced that verizon and Frontier were looking to selling off portions
of their networks in Upstate New York. Reports have also indicated that
the companies that were interested in purchasing the lines are private
equity firms and speculators interested in generating quick profits,
rather than traditional telephone companies interested in operating the
business over the long term in the upstate region. Such a sale would
clearly have a dramatic impact on telephone service in upstate areas and
would have a pronounced effect on the policy of universal service. It is
therefore vital that the Department of Public Service, the Legislature,'
and the Governor understand the full range of issues and questions aris-
ing from the sale of a large sector of telephone networks on service
quality and public safety. among other issues.
Third, before consent is given to any merger, the Public Service Commis-
sion must agree that such merger is within the public's interest. The
Public interest requires that the Public Service Commission's analysis
of mergers and conclusions drawn there arise from objective valid veri-
fiabie empirical evidence, rather than from unsupporte d statements of
policy or conclusory observations. It is additionally in the public
interest to require a portion of the benefits of telecommunications
mergers to be returned to the state's ratepayers as refunds, reinvest-
ment in the infrastructure, providing E-911 services or to finance
repairs, maintenance or new construction that might otherwise be
unfunded. Finally, requiring the Public Service Commission to conduct
its analysis upon an enumerated list of public interest factors
increases the participation of the public and other stakeholder groups
in such proceedings, which enhances the transparency and accountability
of the merger analysis process.
VII. ANTI-DISCRIMINATION IN ACCESS TO TELECOMMUNICATIONS SERVICES
Pursuant to section 228 of the public service law, cable television
companies are authorized to install their facilities upon private prem-
ises under reasonable conditions. This statutory authorization, however,
does not apply to any other types of telecommunications service provid-
ers. This bill would permit all types of telecommunications service
providers to install their facilities upon private premises, under
reasonable conditions, in recognition of the current range of telecommu-
nications service choices available to consumers and the potential for
expansion of such services. The bill would thereby allow equal access by
telecommunications service providers to install their facilities in
private premises so that consumers will in turn have full access to,
variety of telecommunications services.
VIII. WIRELESS TELECOMMUNICATIONS
Wireless technology has developed rapidly across the globe. For many
people across the State wireless telephone service is now their primary
mode of communication. Many other customers, especially older ones, use
cell phones primarily for safety in the event of emergencies during
travel. Assemblyman O'Donnell sponsors legislation that will give
consumers protections such as disclosure of terms, conditions of
services and charges, 5-911 service, and coverage maps and areas.
Alongside Assemblyman O'Donnell's legislation there should also be a
study into wireless telecommunications service providers to ensure
consumer protection, health and public safety. With the expansion of
wireless telephone service it is in the public's best interest for the
Public Service Commission to go forth with a study and report their
findings to the Legislature in 180 days after this bill shall become
law. Taken together this legislation will provide the resources for
modernizing the State's telecommunications network, provide choice for
consumers, and protect the legacy system.
PRIOR LEGISLATIVE HISTORY:
2024 01/03/24 A3682 referred to corporations, authorities and commis-
sions
2023 02/03/23 A3682 referred to corporations, authorities and commis-
sions
2022 01/05/22 A3472 referred to corporations, authorities and commis-
sions
2019-2020 A3693 referred to corporations, authorities and commissions
01/03/18 A1958 referred to corporations, authorities and commissions
02/08/16 print number 2118a
02/08/16 A2118 amend and recommit to corporations, authorities and
commissions
01/06/16 A2118 referred to corporations, authorities and commissions
01/15/15 A2118 referred to corporations, authorities and commissions
2015-2016 A2118A referred to corporations, authorities and commissions
2013-14 A4143-A report to commissions and authorities.
2009-10 A1875 referred to corporations, authorities and commissions;
A.3980 (2007-2008). However, note: Reference to wireless telephone and
consumer protections
A. 2030 of 2007(O'Donnell); telecommunications service and consumer
protections standards A.3704/3705 of 2007(Tonko). Includes elements of
A.6524 of 2006 (Brodsky);
A.9807 of 2006 (Brodsky);
A.9808 of 2006 (Brodsky);
A. 9809 of 2006 (Brodsky);
A. 1423 of 2007 (Brodsky) and
A. 7932 of 2006 (Brodsky).
FISCAL IMPLICATIONS:
Not known
EFFECTIVE DATE:
This act shall take effect immediately
