The California Public Utilities Commission approved a $7.7 million broadband grant while rescinding about $4.5 million for five previous grants awarded to now-stalled projects. The CPUC unanimously approved both items at its Thursday meeting. The $7.7 million grant under the California Advanced Services Fund will help pay for construction of a last-mile fiber broadband project in Occidental, estimated to bring 1 Gbps speeds to 458 households in a currently unserved area. The CPUC also agreed on a resolution taking back grants from five stalled projects covering parts of the Riverside, Sonoma, Mendocino, Monterey and Shasta counties.

Phone companies will face automatic daily fines of up to $25,000 in California for failure to meet service quality measures, ruled the Public Utilities Commission at its Thursday meeting. The CPUC passed the order in a 3-2 vote, with the two dissenting commissioners supporting an alternate proposed decision. Under the approved decision, phone companies will face the fines if they fail to meet the commission’s metrics for (1) out-of-service repair interval, (2) customer trouble reports and (3) answer time for trouble reports and billing and non-billing inquiries. The order requires telcos to submit federally mandated outage reports to the Communications Division. Companies can suspend accrued fees if they make investments in service quality in an amount equal to twice the fine, it said. The alternate proposed decision similarly imposed $25,000 daily automatic fines, but the fines wouldn't start to accrue until a company failed to meet the standards for three consecutive months. “Our decision today provides additional protection for those who have traditional landline telephone service, and it also calls for continued monitoring of the Federal Communications Commission’s proceeding on rural outages, and allows for workshops on how to deal with 911 service and other safety related issues,” said CPUC President Michael Picker. “There are many other actions underway that will continue our efforts to look at telecommunication issues, including a competition study, and a network exam. Clearly we’re not at the end of the discussion." Commissioner Catherine Sandoval, who wrote the alternate proposal, said the decision "advances the CPUC’s work to protect communities and compliance with California law.” At the meeting, however, Sandoval said she would soon release a dissenting statement.

Verizon and XO Communications sought to strike Windstream objections to their proposed transaction at the Pennsylvania Public Utility Commission (docket A-2016-2535279). Verizon and XO objected in a filing Tuesday to Windstream’s Friday amicus brief protesting the deal, with the combining companies saying Windstream should have filed a petition to intervene by the PUC’s April 25 deadline. "In effect, Windstream has attempted to disguise its late-filed ‘Protest’ to the Joint Application as an ‘Amicus Brief’ and to sandbag Joint Applicants with a pleading that is effectively factual testimony, without allowing the opportunity for discovery, responsive testimony or cross-examination," Verizon and XO said. In the disputed brief, Windstream said the deal “is neither necessary nor proper for the service, accommodation, convenience, nor safety of the public." In their main brief Friday, Verizon and XO said the deal "will result in a stronger company that will be better able to provide enhanced services to Pennsylvania customers." Verizon and XO dismissed criticisms of Core Communications and the Pennsylvania Office of Small Business Advocate (OSBA), both of which filed timely petitions to intervene. Neither entity "identifies a single customer or competitor of XO in Pennsylvania that has complained about the transaction," Verizon and XO said. "Neither intervenor identifies any valid basis to conclude that the transaction risks causing any harm.” But Core and OSBA said they saw no substantial public benefits. "XO is a major provider of transport and related services to other competitors, and its merger into Verizon can only result in the elimination of a substantial avenue for competitors to interconnect with Verizon on reasonable terms and conditions,” Core said in its brief. In a separate brief, OSBA said it’s “very concerned that the proposed transaction would result in the worst case scenario for XO's business customers: no benefits will emerge; rates will increase by more than they would have in the absence of the transaction; and the loss of a meaningful competitor in the market will result in not only [removing] a competitive option, but a potential diminution of available services for commercial customers.” All protesters said the deal could be approved with conditions. Windstream and OSBA separately asked for a condition requiring Verizon to continue making unbundled DS1 and DS3 capacity available over fiber or other IP-based technology. Windstream also sought a requirement that Verizon commit to complying with any requirements imposed on price cap ILECs in the FCC ongoing business data services proceeding. OSBA sought conditions requiring Verizon to file VoIP interconnection agreements per Section 252 of the Telecom Act and to cease retiring copper loops facilities serving business customers until it obtains PUC approval of a wholesale alternative on fiber "that mimics the economics of Ethernet over Copper (such as deployed by XO).” Core sought conditions requiring Verizon to offer transport for interconnection to all competitors at cost-based TELRIC [Total element long-run incremental cost] rates, and to offer IP interconnection at standard and reasonable terms and conditions to all Pennsylvania carriers.

Frontier Communications will face more hearings in California over its troublesome transition after acquiring Verizon’s wireline business there and two other states (see 1607080045). The California Public Utilities Commission scheduled three public hearings on call completion issues, including 911 and access, CPUC Administrative Law Judge Robert Mason said in a ruling Tuesday. The hearings will be Tuesday in Guerneville, Sept. 9 in Middletown and Sept. 20 in Santa Cruz.

The New York Public Service Commission should reject utilities’ claims that wireless companies face no barriers attaching equipment to poles, the Wireless Infrastructure Association said in PSC docket 16-M-0330. WIA earlier this month supported a CTIA petition to apply existing pole attachment requirements to wireless providers so the industry can quickly deploy small cells and distributed antenna systems (DAS) that are critical to 5G services (see 1608020029). In replies Monday, WIA said utilities “fail to recognize that their costs for wireless attachments are not the only economic barrier to broadband deployment. Many municipalities have also sought fees to access public rights of way that were never imposed on the utilities in deploying their own plant and infrastructure and which are improper relative to the limited municipal authority reserved by federal and State law.” But New York utilities said jointly the wireless industry testimony failed to convince them there’s a problem. The utilities said “it is clear that CTIA and the other wireless telecommunications providers have not met the burden for the relief sought in this proceeding.” They said wireless commenters still haven’t “provided demonstrable evidence that would support a new generic Commission proceeding concerning wireless attachments.” Doing nothing isn't an option, CTIA said. “If the Joint Utilities’ unabashed invitation to do nothing were accepted by the Commission, New York would find itself in a place where the utilities’ self-interest reigned supreme over the public interest, denying New Yorkers the benefits of advanced mobile broadband deployment.”

Verizon could need to increase capital expenditures if states act against the company due to investigations of copper service quality and fiber upgrade policies, said 556 Ventures analyst William Ho. Verizon has highlighted how much it already spends building and maintaining its network in ongoing investigations in New York, New Jersey, Pennsylvania and Maryland. Also, in a District of Columbia Public Service Commission rulemaking that followed a two-year probe, the telco warned about the potential cost of proposed copper abandonment rules (see 1607260027). The worst-case scenario for the telco “may be that regulatory judgments or edicts require fiber technology,” Ho emailed Friday. “If they weren't planned for, there may be increases in subsequent years’ capex projections.” To keep spending stable, Verizon could shuffle money from other areas, he said. The company might need to reconsider how its business plan balances repairing older copper and installing new fiber, he said. Ideally for Verizon, fiber would be the norm for telecom networks, the analyst said. “Copper as we have in today's world is less efficient and costlier than fiber in terms of future proofing and operations/maintenance.” In the next three to four years, Verizon could use 5G fixed wireless to spread and keep up its network at less cost, he said. “It makes sense in some places as the cost to serve and operational costs like truck rolls and copper maintenance may be nullified.” Verizon wouldn't comment. Replies are due Monday in the D.C. PSC copper abandonment rulemaking, and the state probes are in various stages of comments. The Maryland PSC will determine next steps in its Verizon inquiry after it gets a response from the Communications Workers of America to Verizon’s July testimony about a practice in which it moves customers with major copper problems to fiber (see 1607140027), a commission spokeswoman said. The PSC sent a letter last week asking CWA to respond to the Verizon testimony by Sept. 6. Separately, the New Jersey Board of Public Utilities staff is reviewing comments from a public hearing last week in which the state's Division of Rate Counsel backed state action and Verizon claimed it had invested $100 million over the past two years in “proactive preventative maintenance” of its network (see 1608050043). Meanwhile, the Pennsylvania Public Utility Commission asked for CWA testimony by Sept. 29 and Verizon testimony Dec. 1, ahead of hearings scheduled the week of Feb. 6 (see 1607180020), according to the proceeding schedule. In New York, Verizon told the state commission last week it's spent hundreds of millions more dollars than it makes on its network there (see 1608010047).

Minnesota unveiled $500,000 in grant funding for its Internet Broadband Expansion for Students program. The Minnesota Department of Education sought applications by Sept. 9 from public school districts, charter schools and education districts for projects to expand broadband access for students. Applicants may apply for a Broadband Expansion Off-Campus Learning Grant, and -- if eligible to receive general education transportation sparsity revenue under Minnesota statute -- also may apply for a School Bus Internet Access grant, the Office of Broadband Development said in an email newsletter Friday. The maximum grant per applicant is $50,000.

A bureau of the California State Library should consider the appropriate regulatory structure for telecom oversight by a revamped California Public Utilities Commission, said proposed legislation that surfaced Wednesday. Assemblymember Mike Gatto (D) filed an amendment stripping original language of a bill on damages from the California energy crisis in 2000, and inserting in its place another piece of the CPUC reform package worked out between Democratic legislators and Gov. Jerry Brown (D). The amended AB-2903 would require the California Research Bureau by Jan. 1, 2018, “to conduct a study of telecommunications service governance to determine what regulatory structure would provide the appropriate regulatory oversight of telecommunications services and to assess the overarching goals of the various programs carried out by the commission, including a discussion of whether the commission, as a whole, is strategically aligned towards a clearly articulated public goal. The bill would require the study to review specified matters and to take into account the history of telecommunications service regulation in the state and changes in technology to make recommendations for guiding principles that clearly define California’s goals for the regulation of the telecommunications industry.” Other provisions include a requirement that CPUC appoint an ethics ombudsman and a prohibition on public utility executives becoming CPUC commissioners within two years of utility employment. At a hearing Wednesday, the Assembly Appropriations Committee voted 12-5 to pass SB-1017, another part of the CPUC reform package. The bill aims to increase public access to utility-supplied documents at CPUC. At the hearing, AT&T, CTIA and other industry officials raised concerns about the measure in its current form, saying the bill could result in disclosure of confidential and sensitive information. The bill’s sponsor, state Senator Jerry Hill (D), committed to addressing confidentiality concerns in amendments now in the works. “We’ll be there,” he said. The committee placed two other parts -- SB-215 and SB-512 -- in the committee’s “suspense file,” a category reserved for bills deemed to be costly, for a vote expected later in the month. The three bills already cleared the Senate and the Assembly Utilities and Commerce Committee (see 1606300027). The committee also placed on suspense the Senate-passed SB-745, which makes various changes to grant programs provided by the California Advanced Services Fund, including a requirement that CPUC prioritize unserved housing developments.

Google delayed fiber builds in multiple California cities while it explores alternative technologies, said a staff report by the city of Palo Alto. It could be six months or more before Google resumes its fiber network build in the Bay Area, the report said: “Google indicated that they are exploring more innovative ways of deployment that overcome some of the challenges they are facing in their current builds. It is the City’s understanding that the cities of Mountain View, San Jose, Santa Clara and Sunnyvale are also being delayed.” A Google representative notified the Palo Alto staff about the delay July 18, the report said. “The fiber ball is entirely in Google’s court,” emailed a San Jose spokesman. “We’ve taken care of all the environmental, permitting, and land use procedural issues needed for them to move ahead whenever they’re ready to.” He said the city and Google Fiber have had “a strong, productive working relationship” over the past two years, and the city remains optimistic Google will move forward with its plans to extend fiber into San Jose, “even if their original schedule gets modified so they can take advantage of technology advances that might be potentially less disruptive.” The delay follows Google Fiber’s acquisition of Webpass, a California CLEC specializing in point-to-point wireless broadband that could be combined with fiber to spread high-speed Internet to more homes (see 1606230046). Google Fiber last month opened shop in Charlotte (see 1607120030), and in June said it’s eyeing Dallas for further expansion (see 1606140047). Google continues "to work with city leaders to explore the possibility of bringing Google Fiber to the South Bay area," a company spokeswoman said. "This means deploying the latest technologies in alignment with our product roadmap, while understanding local considerations and challenges, which takes time."

The California Public Utilities Commission said it complied with a court order to immediately retrieve Form 477 and other data in the possession of third parties and to instruct all commission employees not to violate the preliminary injunction of U.S. District Court in San Francisco. Judge Vince Chhabria rebuked the CPUC last week for violating the temporary ban on disclosing the data, which includes information about phone and broadband deployment that AT&T, Comcast, CTIA, Verizon and other industry plaintiffs say is confidential (see 1608050015). CPUC retrieved the contested data Monday from Lee Selwyn, president of Economics and Technology Inc., it said in a status report (in Pacer) filed Monday.