CPUC Workshop - 2020-10-07
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California Public Utilities Commission
Follow its sittingsSpeaker 3
But some things seem impossible to dispute. First large portions of Frontier service territory are in rural California. Large portions of those areas and across their service territory have medium household incomes below $50,000 a year. Large portions of those rural low income areas and Frontier is the only provider of both voice service and VoIP service. When a customer reports a service outage our general order 133 requires the carrier to repair 90% of those outages within twenty four hours.
Since 2014 there have only been a few months when Frontier met that standard. I am very concerned that Frontier is not providing high quality reliable and reasonably reasonably priced service to many of its customers and that many of those customers have no other option. In reviewing this application California law requires us to determine among other things whether granting the application will maintain or improve the quality of service. I'm also disappointed that Frontier seems to be focusing on maintenance rather than improvement. For example, it writes that the company will continue to provide the same services at the same rate under the same tariff terms and conditions as it does currently.
And elsewhere that restructuring will be for all practical purposes impresittable to customers. In the restructuring plan it filed with the bankruptcy court though. Frontier seems to recognize that some of its service needs to be better. It proposed to create a virtual separation under the same ownership structure of select state operations where the reorganized debtors will conduct fiber deployment, which they called Invesco, from those state operations where the reorganized debtor would perform broadband upgrades and operational improvement, which it called Improveco. I really do not want this restructuring to be status quo for customers.
I want all Frontier customers in California to look back at this application as the moment when they started getting the service they deserve and are paying for. I'm deeply concerned that Frontier intends to prioritize fiber investments in Invesco in those parts of its service territory that are already highly profitable. The wealthier urban and suburban areas that it serves. And that frontier intends not to prioritize new fiber in improved co in those parts of its service territory that are more expensive and less profitable to serve. If that happens the digital divide will get wider.
Fortunately this application can only be approved as the Commission can ensure not just aspire to or hope for but ensure that a reorganized frontier provides the best service to everyone in its service territory. I would like to know and hear from all of our local leadership and for those that aren't here today from Kern County, Lassen, Riverside and all the other counties that they serve. I want to challenge everyone in this meeting and discussion Commission staff, Frontier, interveners, panelists, members of the public to think creatively and constructively about how we can do a better frontier. I want to emphasize that this workshop is the start of a discussion. Practically speaking the way we're going to include segments by the panelists and by the parties is through a workshop report which our Communications Division staff will prepare and which we will be taking party comments on.
I look forward to this event but just as importantly I really look forward to seeing everyone's comments on the workshop report. So with that I want to thank you and look forward to this great discussion.
Speaker 3
And Ms. Bryan, before you transfer over to the first presentation, I did want to see if any of my fellow commissioners I see that Commissioner Rexhauffin, President Thatcher and commissioner Randolph are all on. And if they had any remarks to make before, I would open it to them.
Speaker 5
This is commissioner Randolph. I don't have any remarks. Thank you very much for convening this workshop, commissioner
Speaker 6
This is Commissioner Rex Johnson. Nothing more except to underscore how important what Commissioner Guzmanischevich just said that we're looking at ways that the application will not just maintain for service quality, but improve service quality that needs to be the metric.
Speaker 3
President Batcher? Okay. Not seeing maybe she's not on voice yet. Okay. Ms.
Bryant or Yella, if you're back on, I think we're ready to to the Frontier presentation.
Speaker 4
Sounds good. Thank you, Commissioner. We will go ahead and move to the presentation for Frontier at this time. Allison, you may begin.
Speaker 8
Sorry, I was on mute. I'm just trying to I took the presentation, but I'm trying to I don't see how I can advance it. I'm not seeing the same menu on the left hand side that you showed me before. Can you hear me?
Speaker 8
Just to the next page please. As we're doing that, I just would like to say thank you to President Batcher and the other commissioners for allowing Frontier the opportunity to present at today's event. I'm Allison Ellis, SVP of Regulatory Affairs. On behalf of Frontier, we also have Kevin Seville, our General Counsel Patrick Roswell, our Outside Counsel and Charlie Born, who is our Director of Government and External Affairs here in California. Just to start the backdrop of why we're here today as Commissioner Guzmanafeva said, Frontier was in a position where we were facing significant and increasingly unsustainable debt obligations that were threatening our, future ability to provide services.
We as a company filed a Chapter 11 bankruptcy reorganization proceeding in order to address those financial issues that we were having. Kevin Seville will talk about those in more detail in a couple of slides, but we have asked the commission to approve a corporate restructure associated with that reorganization effort. In terms of Frontier's presence in California, so we operate three incumbent traditional local exchange carriers, Frontier California, Frontier Communications of the Southwest and Citizens Telecommunication of California. We've actually been in the state since the 1930s, but we took a larger role in the state in 2016 when we Verizon's landline company there. As you can see from the map, we have a varied service territory in California that spreads essentially the entire state.
We serve some of the most rural and sparsely populated, areas of the state, as well as some of the more urban and suburban densely populated communities, particularly in the southern part of the state. We have about 2,800 employees in California and those employees are supported by a workforce of, an additional 14,000 people, who are in our, 25 state footprint. We offer voice, video and broadband services. Joe, if you could advance it, please. Although we are a traditional LEC, we are not a dominant voice provider in the state anymore.
Wireless cable and voice over IP providers have really captured the voice market. What we see in terms of our subscribership trend in California is very consistent with what similarly situated carriers have seen across the nation and we at Frontier have seen in the rest of our 25 state footprint. We customers are increasingly selecting wireless services and are cutting the cord entirely. As the CPUC's 2019 report showed, Frontier now serves only about 15% of the 5,000,000 regulated voice lines in California and the CDC review of voice subscribership backs this up. There are in California only 3.3% of consumers are wireline only.
As I said, while we're a traditional provider, we're not a dominant provider. We're also no longer rate regulated in the way that incumbent LEX traditionally were. We're an IRF carrier. What that means is that we are not guaranteed a recovery on either our investments in the state or the cost to provide service. Yet, we have continued to focus investment in California and since our acquisition of Verizon in 2016 had invested more than 1,000,000,000 in CapEx in the state.
Joseph, if you could please advance. We certainly appreciate as, a company that an area of substantial interest and significant interest for state and local leaders, regulators and consumers is the availability, and performance of broadband services. It is an area of focus for Frontier as well. We have a number of initiatives that have undertaken a significant effort to expand and enhance broadband services in California. Most significantly is the CAF II initiative where Frontier in, collaboration with the FCC committed to build tenone megabit service to approximately 90,000 households in some of the most rural areas of the state, which were identified by the FCC.
Our work, to expand that broadband is ongoing and must be completed by the 2021. A key thing to note about the CAF II initiative is that, prior to our acquisition of Verizon, Verizon was not willing to accept the FCC obligations. So by acquiring Verizon and assuming those obligations, Frontier was able to make the commitment to expand broadband availability in California. As of August 2020, we have completed about 74,000 CAF II locations, roughly 2,400 of those locations are in tribal areas, including the Yurok, Subobah, Morgan and Taurus Martinez reservations and many other rural areas across the state. We also in connection with the 2016 acquisition agreed to execute on a six year plan that goes through 2022 to expand broadband to an additional seven hundred and fifty seven thousand households.
We are making significant progress on fulfilling that commitment. As of the year end 2019, we exceeded our annual 2015 excuse me, 25.3 megabit commitment of meeting 200,000 households by that date. There is more to come on the 25.3 front with 250,000 households slated to be connected in the next two years. We've also performed well on our 6.1 commitment. We actually met that commitment two years early and we're on track with our 10.1 commitment and expect to be completed with our annual objective by the end
Speaker 8
year. These investments and the work here has expanded new and upgraded broadband to more than 15,000 households in tribal areas including Agua Caliente, Bishop and the Big Pine Reservations. And also again, a number of additional rural communities across the state that were not necessarily reached or identified through the FCC's mechanism. The last component of our broadband expansion is that Frontier has been a big participant in the CASF, the state CASF grant program. We have been awarded 13 grants to deploy broadband service to over 8,600 households.
And we currently have 10 grant applications for fiber to the premises grants pending with the commission. If those are approved, an additional 3,000 households will, be served with fiber to the premises facilities and it will also connect many anchor institutions in rural areas. Next slide please, Joseph. We understand that availability and expansion is only one part of the equation. However, adoption is another key component.
Frontier supports low income access to services. We participate in the Lifeline program. We offer two affordable broadband. I'm getting some feedback. We offer two affordable broadband offers and we have also partnered with the California Emergency Technology Fund on affordable broadband and adoption initiatives, including an initiative to distribute 50,000 Chromebooks to low income consumers.
And most recently, we're very proud of a joint effort that we undertook with CETS in response to
Speaker 8
COVID-nineteen pandemic. We worked to identify school children in high need school districts and have prioritized distribution of 5,000 Chromebooks to those students. We actually have an event next week scheduled to distribute Chromebooks to tribal school children. So, we've worked very hard to try to help address some of the connectivity issues that school children in particular have been having as a result of the pandemic. We are also continuing to focus on and look to improve our voice service quality.
We have met some of the metrics, the twenty four hour out of service restore all metric continues to be a challenge. However, we have consistent with the CPUC's rules invested twice the amount of applicable fines for not meeting that metric in service quality targeted projects and improvement efforts. We're on track assuming that the commission approves our 2019 project proposal to spend 6,800,000.0 in targeted investment on service quality. These projects have all been reviewed by the commission and approved by the commission and are a step that we're taking to ensure that we can address some of the voice quality issues that we have had in some of our you know, more difficult to serve areas of our footprint. Joe, if you could turn it to the next slide, I'd like to turn the presentation over to Kevin Seville who can address the next few slides.
Speaker 10
Thank you, Allison. And my name is Kevin Seville. I am the General Counsel of Frontier Communications. And as Ms. Ellis indicated, you know, we do appreciate the opportunity to make this presentation to the commission.
Ms. Ellis is focused on some of the California specifics in terms of our operations in the state. I want to just take it to the Frontier Communications corporate level and provide some additional background. So Frontier Communications with its operating subsidiaries is a telecommunications company providing telephone, internet and video services in 25 states including California. In 2019, the company had revenue of approximately $8,100,000,000 but we experienced a loss of approximately $5,900,000,000 Frontier also had significant debt, which amounted to approximately $17,500,000,000 of outstanding funded debt and the company was paying annual interest expense of approximately $1,500,000,000 per year.
To address these unsustainable levels of debt tend to better position Frontier to meet its customer needs and to compete in a changing telecommunications marketplace. Frontier proactively engaged in an effort to negotiate a restructuring of its debt with its creditors. These discussions culminated in an agreed upon restructuring plan that had the support of more than 75% of its unsecured note holders. And turning to Page six of the presentation, the first bullet point there with that agreed upon restructuring plan with the bondholders Frontier did file for Chapter 11 on April 14 with the United States bankruptcy court in the Southern District Of New York. The Chapter 11 bankruptcy filing enables Frontier to restructure that $17,500,000,000 of debt and reduce it to approximately $6,500,000,000 With that restructuring, the senior note holders will become the new shareholders of the company.
On May 22, we filed an application with the commission asking that the organizational change be approved. The fundamental change that is before the commission is replacing our existing shareholders with a new widely held diverse group of shareholders and the expectation is that when we emerge from Chapter 11, the company will be publicly traded. On August 21, the bankruptcy court after soliciting votes approved the plan of reorganization and one of the key components of this plan of reorganization is that with the exception of the unsecured note holders, all other creditors and third parties engaged in business with Frontier have their claims unimpaired. What that means is that effectively all of our collective bargaining agreements with the unions, all of our contracts with our vendors, all of our third party stakeholders will be made whole following the emergence from the Chapter 11. We will emerge from Chapter 11 after we secure the necessary regulatory approvals.
We're hoping to do that in early twenty twenty one. The reason for that is the longer we stay in Chapter 11, the more administrative and legal costs we incur in the bankruptcy process and the more exposed we are as a company in terms of competitors taking our customers. So, if I could get you please to turn to the next slide. The benefits of the restructuring are that the reorganized Frontier will be a stronger better capitalized company. It allows Frontier to remain viable and continue to offer telecommunications services as an alternative option to California consumers.
It will also enable the company to be positioned to better respond to the dynamic and unanticipated economic events such as COVID-nineteen, changes in the economy and certainly changes in a very dynamic competitive landscape in California. As I mentioned, the restructuring is positive for our California stakeholders in that California is a very important state to Frontier and having shed $1,000,000,000 a year in interest in reducing our debt overall will enable us to have a stronger financial focus in California. And then as I mentioned, all of the existing contracts and arrangements we have in place will be unimpacted by the Chapter 11 and our operating subsidiaries will continue to operate in accordance with their existing regulatory authorizations issued by the commission. Conversely, denying or delaying the position will significantly hurt Frontier and the public interest, because with the status quo, as I indicated, the company has unsustainable levels of debt and insufficient capital resources to be able to continue to fulfill its obligations to its customers and to the state and to really effectively respond to competitive issues. If our application is denied or delayed, it would potentially mean less competition within the California telecommunication marketplace, including us providing voice service as an alternative.
It will also impede our ability to work and focus on improving voice service quality, which we know is an important issue for the commission and it will impact impede our ability to fulfill our build out requirements with respect to broadband. So let me turn to Mr. Rosbold to cover the last slide.
Speaker 11
Thank you, Kevin. And hopefully everyone can hear me on the phone here. So good morning, commissioners. I miss seeing you all in person, but I really appreciate the opportunity to present today and to provide these opening remarks. My role here is to provide an overview of the statutory standards and give a sense for how Frontier has applied those standards in its application.
And so as you know, what triggers the application here isn't the bankruptcy itself and isn't the restructuring, it's the transfer of control that's involved at the parent company level, which involves a substitution for the current ownership for a new set of owners, which will be similarly situated to the current ones in the sense that they will be widely dispersed owners likely to be publicly traded just like today. But nevertheless, event, which is linked to the restructuring, does trigger the requirements of Public Utilities Code eight fifty four. So that's the primary statute, as you know, that governs transfers of control. Frontier also filed under Section eight fifty three, which permits the commission to limit some of the aspects of Section eight fifty four where they aren't applicable or aren't appropriate for the particular transaction. And indeed, the commission did that here with the scoping memo, excluded a few of the subsections of Section eight fifty four from the analysis, notably Section eight fifty four(two) which is sort of a relative rate of return regulation, a concept that if the cost structure of a company changes by virtue of typically a merger or acquisition that there has to be more of a numerical analysis of how to allocate those benefits.
In this case, we're dealing with an IRF company, a company that's in a deregulatory status and so that standard doesn't apply and the commission did find that in the scoping memo. Then there are a couple of other aspects that were excluded from eight fifty four. And the remaining eight fifty four factors as you know pertain to issues that analyze the effects of the restructuring and the transfer of control on various aspects of Frontier's operations. The unifying concept though is that all of those factors should relate to the effects of the restructuring, the effects of the transfer of control. So I guess in light of those that overview of the statute, there's a few I think key points that distinguish this matter from probably most matters the commission addresses under eight fifty four.
The first one is just the narrow focus of the transaction at issue, which is to say that we're not talking about approving the reasonableness of the bankruptcy itself, that's a matter for the bankruptcy court. We're also not talking about the effects beyond the restructuring. We're just focused on there's a transfer of control that will effectuate a restructuring, which has in our mind pretty clear benefits to Frontier into the state of California. And so it's not a situation where you have a merger or acquisition where you can sort of compare the pro form a entity that would come out of this to the existing entity and ask yourself the question, which one is a preferred outcome. In this situation, Frontier has an opportunity to shed a level of debt that would be crippling going forward.
So it's very difficult to argue in our view that Frontier would be better off continuing down that path and we think the facts are pretty clear not just here but throughout the country that Frontier will be far better off if it's able to avail itself of this and we'd be very concerned if we wind up in a situation where that deleveraging does not occur. I think it would not be a pretty picture for Frontier down the road. The second thing that's just a complicating factor procedurally, but which simplifies things to some degree is just the presence of the bankruptcy and the bankruptcy court weighing in on the merits of the plan. So that's something that's been approved. That's not a layer that typically exists in a merger and acquisition situation, which is the typical eight fifty four application structure.
So in this case, we're now sitting here a month or more separated from the approval of the plan, which the bankruptcy court has already determined balance the interests of the stakeholders that are affected by the plan itself. And then the third thing which Kevin hit on, I think just can't be lost here is that there are 25 states involved here and there are significant benefits that will occur if this is approved and approved quickly. And so we appreciate very much the Commission setting a schedule that would allow that to occur and holding events like this and indeed potentially at the hearings in a few weeks at a time that would allow for a timely resolution of this matter because the benefits are contingent nationwide on getting all of the approvals necessary. So that's I wanted to highlight some of the unique features of this particular situation that might be different than your typical August situation. And I think with that, we've come to the end of our presentation and we just look forward to doing some good listening today.
And all of us will be available for questions should that be appropriate and we'll be here throughout the day and into the night to listen to the feedback. So thank you, Commissioners.
Speaker 4
Thank you, Frontier, for the presentation. Commissioner, do you have any questions or does the president would like, to say anything?
Speaker 3
Yes. President Batcher, if you, like any I know your sound was off earlier, but you'd be open to you now if you'd like.
Speaker 12
Oh thank you very much Commissioner Guzman Aceves. I don't really have any questions at all. Sorry to be late to this forum. Very helpful presentation from Frontier. So I thank you.
I think that time is better spent with our panelists. So, thank you.
Speaker 4
Great. With that, we will now move to communication staff presentation led by Mikayla Pangilinen. Mikayla is a Senior Regulatory Analyst in the Communications Division. Mikaela, you may start.
Speaker 7
Please standby while we navigate to the slide. Thank you. Please stand by. Going to splash up the slides in just a second here.
Speaker 14
Okay, great. Looks like it's up. So, can you go back to the first slide, the previous slide? Yes. Okay, great.
Thanks. So, we'll start first with a quick discussion about Frontier as a company using several maps developed by our CIS team. The maps are for illustrative purposes and not to scale. Next slide, Joe. Just to make sure everybody understands.
Okay, next slide. So here we're showing a map of the various carriers of last resort in California. One of which is Frontier. In 1995, the California Public Utilities Commission granted Frontier the authority to operate as a carrier of last resort and as an incumbent local exchange carrier. So as a carrier of last resort, Frontier must provide basic phone service on a non discriminatory basis.
After Frontier acquired Verizon's assets in 2016, Frontier expanded its service footprint, which now covers which now covers 44 California counties. Next slide. Frontier service territory also includes federally recognized tribal lands in 22 counties in California and about 21,100 households reside in these lands within Frontier's service territory. Next slide. Frontier also acquired the video franchise that Verizon previously held.
The video franchise encompasses five California counties, which are Ventura, Los Angeles, Orange, Riverside and San Bernardino representing the same locations as where Verizon built its BIOS network. These same counties also represent the largest concentration of Frontier subscribers of fixed broadband internet access services. Next slide. For this map, we wanted to show that Frontier offers the higher advertised down stream speeds of at least 100 megabits per second for fixed broadband internet access services in looks like Southern California, and also in pockets of, Shasta, Plymouth, Modoc, Caloosa and Sacramento County. Otherwise, Frontier mostly offers advertised downstream speeds of less than 100 megabits per second in California.
Next slide. For this map, we want to show that the California Advanced Services Fund Program subsidizes the cost of building infrastructure to provision broadband internet access services to unserved households. This program has about a $300,000,000 budget to spend on eligible projects in 2022. Since November 2018, the Commission has approved CSF infrastructure grants for 13 projects for Frontier located in 13 different counties. Most of these approved projects for Frontier consisted of last mile type of projects ranging in award amounts of about $41,000 to $11,000,000 But Frontier receives a much larger portion of government support from the Federal Communications Commission's universal service program.
California's portion of the money Frontier received from various governments is a very small portion of that, which we will discuss later. Next slide please. The California High Cost Fund B program subsidizes the cost of basic phone service paid by residential households living in areas in California in which the cost of provisioning basic point service is high. So, Frontier is one of the two carriers of last resort along with AT and T offering basic point services in areas subsidized by the California High Cost Fund B program. Frontier has about 59% of the total number of phone lines supported by the California High Cost Fund B program.
And as you can see and as Commissioner Guzman established pointed out earlier, Frontier's service tori is well represented in highly populated areas of Southern California, especially the Inland Empire, but a good deal of the areas, are in rural locations. Next slide. This map, represents, the out of service repair interval as reported by Frontier. The, and it includes all three of those companies listed up there. The CPC established uniform minimum standards of service and reporting requirements for our Public Utility Telephone Corporation in general order 133D.
The out of service repair interval measures the average interval between the time a telephone corporation responds to out of service trouble report and the restoration of the customer service. The standard is 90% of the out of service trouble report restored in twenty four hours or less. The map reflects the reported results aggregated at the county level and for the entire year of 2019. It does not reflect allergists that occurred on Sundays, federal holidays, catastrophic events and or declared disasters because they are excludable under General Order 133B. In 2019, just in case it's difficult to see, there exists no county in which Frontier reported meeting the out of service standard at the county level meaning as you can see the map shows there are no green colored counties.
For most of the counties Frontier reported that it resolved less than 60% of the outages within twenty four hours. Next slide. This map, uses Frontier's reported out of service data to show their twenty nineteen average outage duration. As with the previous out of service repair interval map, the average outage duration map reflects the Frontier's reported results aggregated at the county level and for the entire year of 2019. The map also similarly excludes outages happening on Sundays that are holidays catastrophic events and are declared disasters.
Looking at this map, it appears that consumers in Mendocino, Palma, Shasta, Sonoma, Santa Clara, Kern, and Ventura County experienced longest outage durations and service restoration times. So, have eight minutes remaining for this portion before we begin Panel one, So, perhaps it'll be best to open it up for questions if anybody has any. We have Dion Good, our mapping extraordinaire on hand to answer questions as needed, as well as Gregory Rubenstein from our service quality team if there are any questions that I cannot answer. Yaela, do you want to prompt?
Speaker 4
Hi. Yes, thank you very much, Mikayla, the presentation. Do we have any questions from any of our commissioners at this time?
Speaker 3
No questions. I don't know if there's anything on the chat, any clarifying questions that we should look at from the public.
Speaker 4
We do not have any questions at this time that we've received from the email. We can open the phone line if we want. Operator, do we have any speakers or any callers on the line at this time?
Speaker 12
Yes, thank you. I show no participant callers in the queue at this time. Please stand by, it may take a few moments for questions to come in.
Speaker 3
I have a question while we're waiting. Has maybe this question also goes to the Frontier representative. But one of the areas that we have also been looking at in addition to the subsidies from state and federal government that we've talked about, high cost fund B and CASF. Frontier also receives and participates in the Lifeline program and I know Allison you spoke to some of this. Can you speak to some of what you envision for the future particularly for the broadband participation in the Lifeline program.
Speaker 8
Well I can tell you that we you know we continue to advertise the Lifeline program and to seek to connect customers with it. Here let me turn my video back on. Sorry, can you swing down? Yes. So, continue to advertise the Lifeline program.
We continue to, you know, seek to enroll qualifying customers in it. But what we have seen over time is that participation in the program, the rates of participation continue to go down. We took that into account actually when we developed our Frontier Fundamentals Broadband offering and we did that in consultation with the California Emerging Technology Fund. And we actually lowered the qualification barriers and decoupled it from the Lifeline program because what we have found throughout our experiences is true not just in California, but in other states, is that the qualification process is really quite difficult for customers and that in and of itself is a gating criteria. So, know, or barrier to utilization of the program.
So, when we developed the Frontier Fundamentals Program, we streamlined the qualification process and we mapped it to programs where there was a high amount of participation in the state and just made it a little bit easier to, not a little bit easier, a lot easier to qualify for without all of the various, you know, documentation. So, you know, looking into the future, unless there are significant changes with the Lifeline program, I would expect that the rate of participation in that program will continue to hold steady if not, you know, continue to decline.
Speaker 4
Great. So let's check thank you, Alison. Can we check the phone line one more time to see if we have any callers? Operator, do we have any callers?
Speaker 4
It doesn't appear that we have any callers just yet. I think what we can do is we can take a quick break and then we can move on to the first panel discussion at 11:00. Is that okay with everybody? So we will take a quick break and then we will move to panel discussion at eleven. Thank you everyone.
Will let the public know when we are open for questions, input or comments. You may also send your questions or input for the panelist by email by sending it to telco. Events cpuc. Ca dot gov. Karen, you ready?
Speaker 12
I am. Thank you, Yela, and good morning, everyone. Our guests for this first panel have been asked to bring their perspectives on their experience with Frontier in their community. I will introduce all of the speakers and then each will speak before we take questions. Each of them has unique and very impressive qualifications as leaders within their communities, and at this time of pandemic and wildfires, I would like to thank each of them for taking the time to be with us today.
Our first panelistcan you advance the chart please, Robert? Go, sorry. Thank you. That's the one I want to see. Thank you very much.
Our first panelist is Dori Biet, who is Northern and Southern Miwok and resides on the Tuolumne Rancheria. She's a former Councilwoman who now specializes in California Indian land issues at both the state and the federal level. Ms. Beats is a planner and emergency manager for the Tuolumne Meewok Tribal Council, and this position involves her in every aspect of community development and emergency preparedness. Jose Ramirez is the City Manager for the City Of Livingston, where he has been for almost over seventeen years.
He is active in many civic leadership organizations and is also serving as a board member on numerous county agencies for economic development and with groups serving children and families and solving housing issues. He works with both the School of Engineering and the School of Social Science at CSU Fresno. Early in his career he was an Emergency Management Coordinator for the Bureau of Reclamation. Next we'll be hearing from Matt Rantanen who is the Director of Technology for the Southern California Tribal Chairman's Association, where he has led tribal digital village network for almost twenty years. Mr.
Rantanen is Cree from First Nations Canada and is also of Finnish and Norwegian descent. He is the Director of Partnering and Business Development at Arcadian InfraCom. Mr. Rantanen is very active federally where he is the Co Chair of the Technology and Telecom Subcommittee of the National Congress of American Indians, and is also a member of the FCC's Native Nations Broadband Task Force. Now we'll move up to Mono County where Fred Stumpf is the supervisor of District 2.
He was first elected to the Board of Supervisors in 2012. Thank you, Joe, if you could show the overview chart. And Supervisor Stumpf was reelected in 2016. He has a long career in public service and spent over thirty five years with various fire agencies. His last fire protection assignment was as the chief of the Long Valley Fire Protection District.
Our last speaker today is Kevin Goss, the District two Supervisor from the Plumas County Board of Supervisors. He was first elected to the board in 2013. Supervisor Goss is also a small business owner in Greenville and has experience with negotiating infrastructure builds with public agencies. The North Fire Complex is in Plymouth County now. So I do not know if Supervisor Goss is with us at the moment but I've been in touch with him and we certainly appreciate his time today.
Joe, can you please advance to the next slide which shows the questions for panelists? Oh, excellent, thank you. So these are the questions that the panelists have been asked to consider this morning. You can see that we would like the panelists to describe their experience with Frontier, what they have done with that experience and the suggestions and specifics that they might have for this Commission going forward. That concludes my introduction.
Ms. Beech, we're ready to hear from you now. Joe will advance the slides when you ask him. But if you can speak now and we'll see if we can hear you.
Speaker 15
My name is Dori Beats. On behalf of the Tuolumne Band of Miwok Indians, I'm here to provide our input, not only on the historical relationship that we have had with Frontier Communications, but some ideas of how Frontier can move forward when providing service to not only our tribe, but all tribes. I serve as the tribe's planner and emergency manager. I am a tribal member, and I reside here on tribal lands. Next slide, please show.
We are a federally recognized tribe located in Tuolumne County here in California. We oversee and manage approximately 2,000 acres of land, some of which is in tribal trust and other that is in tribal fee. We have approximately four ninety six tribal members with 100 homes currently on tribal trust land. We are growing with at least another 50 homes needed or planned in the near future. In addition to critical buildings such as our tribal government offices, tribal public safety, which includes both fire and security, our health clinic, we have several businesses, including a casino, a hotel, RV resort and a gas station.
We are the second largest employer in Tuolumne County. Next slide, please, Joe. Just for location purposes, this is where we're located within Tuolumne County, within California. And we are the pink area of land within Tuolumne County. Next slide, please, Joe.
Speaker 15
There we go. So I want to talk a little bit about our experience with Front Frontier. I have lived here since 1993, spent a lot of my summers here as a child of my grandparents, but I was a resident that used to use Frontier. Since I can remember, Frontier has consistently provided subpar service to our residents and the tribe and our business endeavors. Some of the issues our tribal government has seen over the years include, in 2004, Frontier was unable to provide simple in town point to point T1 service to allow telecommunications to function properly at our health clinic, which is located on tribal fee lands in the town of Tuolumne.
Up until 2005, Frontier was unable to provide even common PR1 PRI service. When we opened our casino in 2005, Frontier actually refused to install fiber to our new facility. Discovery and failure to properly ground their own gear caused a massive outage in 2010. There were continuing errors that were never repaired on T1 trunk lines used for telephone communications, coupled with zero interest in upgrading the cable plant that was actually located on the Rancheria. There was poor installation of all the equipment, not late circuits, refusal to ground equipment, poor wire management.
All of these instances resulted in having no choice for a tribal government side. And in 2001, we switched all of our tribal government and business communications to Comcast, leaving only a few POT lines and DSL lines as backup. It has issues, especially with power outages, but it's better than what we had or had been offered by Frontier. Today, we still have circuits coming in from Frontier that are purchased via third parties to facilitate operation of their equipment on tribal premises, wide area gaming circuits that are still failing regularly to this day. Our business entity side and the IT department staff are actually pleased to no longer rely on Frontier for communications, as it was a constant fight to get service that was even capable of facilitating any of our business needs.
On our residential side, not all of our 100 homes have chosen to keep Frontier, simply because of the low quality of service. I am one of those homes that relies completely on self-service only. It takes days often to get a service person to respond. The voice quality has been lacking over the years. But for emergency services, we support having landlines in our homes, especially for our elders.
It's vital. We have been left with little choice and feel stuck to do with what we are given. I tell a story about my mother who retired from AT and T. In fact, my grandmother, who was travel chair in the 70s, retired from Maumelle. She was a telephone operator and worked in Sonora.
My mother then retired from AT and T as a systems engineer. My mother has often gone out to the box to fix things herself, and she is 78 years old. The most recent impacts of COVID include distance learning and working from home, where parents and kids have to rely on the internet. And that has truly taken a toll. On weekends, some of our parents have had to drive their kids down to our tribal halls, sit in the car to use our business Wi Fi so that their kids can get their work done, as they have no or inadequate internet service in their homes provided by Frontier through the VFL line.
What can we do? Next slide, Joe, please. Some of the suggestions for going forward. Tribes are stakeholders. We are governments that should be respected as such.
Understanding that we have to grow. It is our responsibility to provide for our members. We cannot responsibly continue to grow without providing adequate services. It was great to hear that there has been some areas within tribal communities California that Frontier has done well. But we would like you to work with us on identifying those opportunities and constraints.
And maybe we have solutions to your problems or vice versa. We would like the opportunity to figure out how we can both provide much needed service. We want to create more opportunities, and we would like you to be more proactive. Don't just ignore us and think we will go away. As a tribe, we are not going anywhere.
As a service provider, we think you should include tribes when improving or upgrading your infrastructure. We have seen where you've improved infrastructure around us and not included us. I run the planning and development department. And years ago, I met with a rep from Frontier, who told me they never improved the infrastructure, simply because they didn't see the value. And they were apprehensive, not understanding how the bills would get paid.
And so we are beyond that. Moving forward, Frontier could really show meaningful interest in upgrading the Tuolumne area to facilitate modern levels of broadband service and increase reliability. Moving forward, if you cannot provide the service we need, then it should be made available to others who will. Moving forward, we need fiber to each of our homes. A fiber deployment would show proper initiative as it is modern and meaningful upgrade to a network that is barely functional currently today.
Slide, please, Joe. In closing, I want to thank the commissioners. I want to thank Karen. I want to thank all the staff and everyone on behalf of the tribe for inviting us for including tribes in this discussion in the workshop. I'm happy to answer any questions.
And I really do appreciate the time today.
Speaker 12
Thank you very much, Ms. Zeke. We will take questions when all of the speakers have finished their presentations. Mr. Ramirez, are you ready for your remarks?
Speaker 17
Absolutely. Thank you very much. First of all, I'd like to thank President Batgier and Commissioner Ocevaz for this opportunity, very much appreciated. I also would like to start by just saying that we need and deserve affordable high speed and reliable broadband. So with that, I would like to talk a little bit about the City Of Livingston, so the commissioners and those of you who are listening online can get a little sense of our community.
We're a very diverse community. 20 of our population is Punjabi, 10% German Mennonite, 10% Portuguese. We have a small population now. We used to have a bigger population of Japanese. This is the original Yamato Colony startup.
We our biggest employer here is Foster Farms. Foster Farms is our world headquarters is located here. And 3,700 employees work not even a mile from where my office is currently. This is also home to Gallo Cheese and the Gallo family. And we're also the sweet potato capital.
So to put all that in perspective, have a lot of immigrants here constantly going back to their home country back and forth. So you can see some of the challenges as it relates to just educating them and making sure that they have access to the Influencers and Highway. So I just want to I've been here in the City Livingston since 2011 and I've had a lot of experience back and forth with, in this case, Frontier. I would like to say and I know that Frontier and management and their new CEO would love for me to just communicate what the truth is and what the facts are. And I would love to say that we've had a good relationship and that we've made a lot of progress.
I would say that we've made just a little bit of progress. And so let me just kind of lay it out. Every week we get some type of complaint from our residents and as it relates to Frontier service. Unfortunately, and I know given and this is pre COVID, a lot of there's been a lot of closures of customer service facilities directly in these different municipalities up and down the state, I'm sure. And so we understand the challenges there, but not having that access to that customer service component really brings a lot of challenges to us.
But now I'm going to pivot and just specifically talk about the municipality side. We've had a lot of different challenges. We've been wanting to have an open and reliable way of communicating information, broadcasting our council meetings and other meetings that we have, again, pre COVID and more importantly now. And so we've endured a lot of different issues with our connectivity. And then back in 2013, we decided to upgrade with T1 line as well.
And we got it done, but the period of time that it took to actually get that done was a challenge. So fast forwarding to now, we've I've been trying to get Frontier's attention and so I've used different ways to do that. I've reached out to my congressmen, to former employees. And finally, I reached out to CTF and was able to make contact with them. It was December 18.
And I basically reached out to them and said, look, there's an opportunity to partner here. There's some grants out there. And I would really love to find ways where we can partner up and work towards bringing more reliable high speed broadband. So I reached out to or actually Amy, the washer, who's the external affairs manager reached out to me. And we went back and forth.
And the last communication that I received from her was on 04/15/2020. I know that COVID played a lot of role playing a lot of havoc and all these different things. But going with six months with no communication on my last communication and checking in, I think that is not acceptable. However, I want to move from here and talk about some of the good things that have happened since then. Through CTF, of course, they talked a little bit about providing the 50,000 Chromebooks initiatives and so there's been some movement there to help a lot of the school district needs in this area and so I thank them for that.
I also thank them for mentioning the potential of having some partnering with the CASF grants in the future and that we might get some investment here. And I just want to I think there's a lot of opportunity. I
Speaker 17
the partnership and collaboration as my former colleague mentioned is the best way to go. And there are only provider in this area. I'm sure that there's other competitors, but in terms of actually investing here, is a big lift. So again, value the opportunity to work with them in the near future to connect broadband to all. So thank you.
Speaker 12
Thank you, Mr. Ramirez. I appreciate your comments. Mr. Rantanen, are you ready to speak?
Can you. Perfect we can hear you just fine too.
Speaker 13
Thank you everyone for for having me and Karen for organizing. And a good introduction there. I just will have a little bit of a correction on the intro. I was a two term member of the FCC's native nations broadband task force and and not currently active. So I just wanted to make sure people understood that.
But having been at the national level dealing with tribal information, tribal technology, and tribal opportunity and policy for the last eighteen years, you know, building and and deploying and designing a wireless and fiber travel network that's over 650 miles long for the last nineteen years. And I think it's tomorrow, starting my twentieth year with Tribal Chairman's Association, I have had a lot of experience working in and around the telecommunications issues that tribes face on a daily basis. And one of the things, you know, that I'd like to do is go out of order. I would like to go out of order and talk about today just because I wanna start on a good note. And that good note is that through the California Emerging Technology Fund during the COVID pandemic that we've been dealing with and with the announcements of schools being online and kids having difficulty engaging with their education and such.
The the folks at the ETF reached out to me we have a good relationship in the policy space asked if there were things that they could do to assist in Southern California tribal chairman's association member tribes and we had a discussion about the the opportunity to get access to some Chromebook. And, you know, through some talking and and working on numbers, we are going to be the recipient actually are the recipients of 350 Chromebooks for students in in the Southern California Tribal Tribes member tribes. It it fulfills most of the need. We we got another grant from San Diego Foundation, but I I did not know that Frontier's money was supporting that. So until we actually got into the conversation with with CETS and and so that is a good note that, we are, you know, receiving some of that goodwill from Frontier to support our students, 350 of our students.
And so I wanted to start with that. But now I would like to rewind and offer some experience as well as some constructive criticism and opportunity along the way. Hopefully, for, you know, a baseline to to work from for change, to be able to perform more effectively and responsibly in Indian country. So Southern California Tribal Chairman's Association is all the tribes in San Diego County. Many of the tribes in Southern Riverside County and part of San Bernardino County as well.
And back in 2001 we did not have any opportunity to get broadband to our tribal community. You know it was on the cusp of changing over from. Dial up service to potentially t one or bonded t one and moving into, you know, d s threes or o c threes, 45 megs on copper. It was right in that transition period of of when networks were starting to to step up the game to be able to support email with images and things. We were looking for a solution to be able to provide our people with access to efficient broadband at the time, and none of the carriers in the in our service areas were doing any of this that would support what we needed to do.
So the tribal digital village network was formed. And long story short, nineteen years later, 655 650 miles point to point, point to multipoint wireless network that's supported by AT and T Fiber on one end and CenturyLink Fiber on the other end. And the AT and T Fiber is actually through Scenic. So we're actually utilizing California's edge research and education network and and tying into the resources that California has provided, but nowhere involved is Frontier. Many times along the way, we had opportunity to work with Frontier, especially after the acquisition of Verizon's assets in California.
Right when that happens. A frontier representative and to be the tribal liaison. Came out. In the Indian country and in California and was told to engage with me. If you haven't seen me in person, I'm six foot four, about two hundred and seventy pounds and that guy, I'm easy to spot in the crowd.
Talk to that guy. So I had you know I've been doing this for a long time and I work with a lot of tribes and a lot of different levels and. She came to me and said hey you know. We just acquired these assets in California we want to make a difference. We understand that you're very engaged in a very very tied up with a lot of the different tribes in the efforts that are going on and you have this network etcetera etcetera.
What are the things that frontier can do to help you moving forward. And I have to say I'm you know I'm I'm kind of over that pitch. I've I've had that pitch from so many people and I give that response and I give a detailed list of things that can happen. Low hanging fruit for frontier to take advantage of. And it it just never it never happened to never materializes so within forty five to sixty days of meeting with that person and giving them multiple opportunities to make good in Indian country to set an example of how you're going to be moving through the future as a vendor to Indian country, potentially even a partner to Indian country in the telecommunications offering.
Disappearance gone forty five to sixty days that person evaporated I assume fired or moved on. Maybe because I gave her too big of a list of things to do I I don't know the circumstances but. And then you know cricket nothing. So you know empty promises and empty requests and empty. You know empty pitches.
Don't go very far in any country we're pretty used to it. That needs to be approved upon moving forward. If you engage a tribe and you talk about solutions and opportunities and feel that these are opportunities that that Frontier can be a part of and partner with the tribe to to find solutions, then, you know, follow through is is your next step to learn in in working with Indian country. Another another example of of issues with things that have happened with Frontier over time, California Advanced Service Fund serves California's efforts to try to get broadband in place for places in Indian country, other places as well. But we have some really amazing projects that are now full fledged companies.
We have companies that have taken on broadband that aren't broadband companies. We have a lot of different opportunities that are coming out of the woodwork that are not traditionally the pathways that you see communications solved, Which is what we need in this day and age to solve the communication problem that money has been put down the same hole for the last. Twenty five years and the result still haven't served Indian country. So we're seeing some creativity we're seeing some opportunity happen and we're seeing some. The real traction in getting efforts in the Indian country.
But we're also getting opposition from Frontier. This is our service area. We should be able to serve that with our rocket fast DSL legacy equipment that's full of flaws and failure. When there are companies that are providing 100 meg symmetrical through fiber to the home through a new creative process that is not a traditional broadband company And and seeking CASF funding help and getting opposition from a company that is only prepared to deliver six one. Now.
The California's fault we have not accelerated. With the times and set a standard for broadband sliding scale to be able to move into today today's needs for broadband. But legacy equipment, not upgrading networks, you know, fighting against alternative solutions and competition that brings in a much better product isn't acceptable for Indian country. We we have a third world problem in Indian country and in rural America. We don't want a third world solution.
We want a first world solution. We do not want legacy equipment to connect us on a limping broadband connectivity opportunity. We want to be at the speed that we should be able to be at which is the standards of today. We do not want to start somewhere back in the legacy process moving forward to today's standards over time we want to start today where we are today with those standards. We don't want to step into the in the history and learn the failures along the way.
We want to be in today's market. So hopefully that can be advice that investment in the in the infrastructure and support of the infrastructure upgrading gear and upgrading services is is part of being a telecommunications company. I've run a company for nineteen years for 24 different tribes that are my board of directors. And we are constantly evolving with power solutions, with connectivity solutions, with microwave gear solutions, with fiber management solutions. We are constantly evolving.
And we're small potatoes. So we expect those larger companies to be able to do the same. And that on that same sentiment, I've I've done a lot of work nationally to support tribes in getting a 2.5 gigahertz license, tribal priority license at the FCC. Personally touched conversations and interacted with about a 170 tribes in the process of doing that. Sadly I learned about several situations where frontier is arguing that they are the incumbent.
They should not have competition in their space. They should not have to fight against a tribe that's building their own network or partnering with somebody to bring in some solutions to be able to bring in broadband when Frontier isn't actually serving them, though they're fighting that it's in their service area. So take that to heart. We're going to find a solution. We would like to find the solution through you if you can advance your offerings and bring a solution that is relevant today.
And I guess lastly, I I would just like to make the comment that Tribes may be interested in. Portions of your in your. Your bankruptcy proceeding if you're carving sections of your network off. Or or facilities, you know, this is a precedent that's been set many times. Tribes have taken over components of telephone companies as they've dissolved assets or or broken up monopolies and different things.
We have a good example in in the Gila River community, the GRTI acquired a major portion of a phone company and and became the service provider for their own people as well as some of their surrounding population, non tribal. So consider this in your dealings moving forward that the tribes may become a partner and actually be poised to take over assets that you're no longer interested in managing so that the tribes can actually serve themselves. So I hope that was informative and and at least a little bit constructive moving forward for you. Thank you for your time.
Speaker 12
Thank you, Mr. Rantana. Our next speaker is Supervisor Stump. Joe, Supervisor Stump has charts available as well. Supervisor Stump, can you say something?
Are you ready to go?
Speaker 19
Good morning. I want to thank the Commission for the opportunity. I particularly wish to thank the Chair, Commissioner Guzman Necheves for reaching out to allow me to speak on this issue. I do have some PowerPoint, if you can put that up. I'm not seeing it on the screen.
Let me know when it's there. There we go. Yes. As stated, I am the District two supervisor in Mono County. Brief description of Mono County District 2, there is one incorporated community in Mono County, it's the community of Mammoth Lakes.
I am the only county supervisor that does not represent a portion of that community. District 2 is large. It is on the South end of the county. It is very diverse. It contains an area that is classified as officially disadvantaged.
It contains a tribe and I did speak yesterday with tribal chair Salk to confirm that I had his permission to represent the tribe and also to verify that the issues I am addressing are shared by that tribe. We have a large percentage of rural poor, we have seniors and the number of seniors on home delivered meals that are on fixed incomes has increased, in fact tripled during my time in office. And so it is a challenging district. I'm speaking to you today because of some of the challenges on an old fashioned telephone plugged into a Frontier landline because A) I have no cell service in the community that I live in and B) other phone failures have necessitated to use. So you get to see this little green thing plugged into my ear as an example of what I'm talking about.
Can I have the next slide please? This I will not spend a lot of time on, but my time on the board, the County has gone into an extensive strategic planning process. This is a representation of that process. Three things to note. Item one is to promote public safety and health.
Item two is to promote quality of life. Item three is to try and create as much as possible a healthy regional economy. We have had successes. It is a component of our legislative platform that is extended to both our state representatives and our federal representatives. We have supported the creation of Digital three ninety five as has this commission, we for which we are very grateful.
We have actually functioned to run the local broadband consortium and we have deployed gigabit broadband to 95% of Mono households. Unfortunately, 5% does not include most of District 2. May I have the next slide, please? I'm going to cover three things here today and then follow-up with some recommendations and requests of reliability, responsiveness and commitment. I think some of my fellow speakers have already touched on these.
So I'm going to go ahead and let's move to the next one. The drivers for reliability. Much of my district is still served by aging copper wire infrastructure. When I say aging, it was there when Verizon owned the system and it is still there. It has not been improved.
There has been no effort to upgrade it. In fact, in another area of my district, unfortunately, typical of California this summer, there was a wildland fire that destroyed a whole set of above ground lines and what was replaced on those lines to those affected communities was copper wire infrastructure. It was not the opportunity to install fiber optic, although it could have been supported was not taken. Second, I want to say that there's a lack of route diversity and that is primarily due to Frontier's refusal to adopt Digital three ninety five. It should be used actively.
It is in both the Highway 6 and Highway 395 corridors, which I represent. I am informed that Frontier will bridge using Digital three ninety five manually if there's an outage. However, within the last month, there have been two outages due to disruptions to the South Of Us and Frontier failed to make that bridge. Power dependent equipment on behalf of Frontier, there is no backup. When power failures, particularly in the areas served by aging copper wire infrastructure, there is no backup, the phones fail.
And what brought this point to me home to me the most was I've had two constituent residents that have passed away. They were discovered and the person that discovered them could not use the phones. They would not work. I find that unacceptable. Nine eleven has to be available, particularly when you have a rural senior population and when it doesn't work, that is not acceptable.
Nine eleven outages, numerous landline cellular and power safety shutoffs each year are affecting the ability for residents to dial 911 and it is the only carrier is in many of these locations Frontier. May I have the next slide please? Responsiveness. We've already heard about a lack of follow through service issues, customer complaints, agency inquiries left hanging. I'm not going to belabor these points except to say ditto in Mono County.
The County itself relies on Frontier and all of these issues particularly for justice dedicated justice lines have been frequent and reoccurring, not to mention what local customers have to face when they have an issue. It is worth noting that many of my customers have to make long distance calls in order to report an outage, that in order to make those calls if they do have a cell phone they have to travel to an area where they have cell service. And if you're a homebound senior, both those things become problematic. COVID has only made this worse. So the ability to resolve long standing service issues, poor quality connections, inadequate service.
I do wish to state that I have personally met with Frontier technicians and they appear to know what needs to be done. They're just not empowered to either spend the money to do it or to create the upgraded infrastructure to facilitate proper functioning of the system. Lastly, we did hear about lifeline customer issues and I have to reference I have had many complaints from my residents about price increases and the difficulty in obtaining lifeline service as mentioned by one of the Frontier people themselves because of the complexity of the process. And that all changed after the switch from Verizon to Frontier. May I have the next slide please?
Here commitment, we have outside plant investment needs, obviously going back to the aging copper wire infrastructure. There is no indication in those areas that only have that as a choice what the long term plans are. The communications levels from Frontier to the local communities to the county have been minimal at best. They are very dismissive frankly of emails, etcetera. Encumbering of CAF II monies.
Well, understand that Frontier as they said earlier today has touted some of those movements, but it has not happened here. And it is impacting the ability to bridge the digital defied network in Mono County, again, made worse in the rural areas by COVID requiring homeschooling, online education and just the ability to visit. Many of our seniors are homebound and they need to be not just isolated completely, but have visits and they can't do that with the current infrastructure even using something like FaceTime or a program on the computer if you don't have high speed Internet and they don't. Lastly, I do want to just, and I'm going to come back to this state that I agree with my previous caller that CAF II monies need to be available to other entities. For Frontier to have a veto power over these two monies, the source of funding is just restricting what can happen.
I have local groups that are willing to form nonprofits to provide service within their but they cannot they're not capitalized and they are blocked frankly by Frontier's veto power. And if you do nothing else in this bankruptcy hearing but remove that veto power, you will enable shorter term turnarounds by more responsive local entities. And I really cannot push that point enough. May I have the next slide please? Here are some of our recommendations.
Do we force Frontier to resolve issues when we appear to get stonewalled? The typical response has been when complaints have been made, the individual issue has been resolved. Well, the individual issue may have been resolved by looking for an effective pair of copper wires to service a residence. However, the basic downfall and antiquity of the system remains. Potentially empower local techs.
Frontier needs to empower its local techs instead of being so centralized. They need to be able to do what needs to be done if they're going to be left in the position of providing the service. Create another venue to provide feedback. Government affairs representatives are not effective. The responses tend to be perfunctory and the as my previous speaker said, they just kind of disappear into the woodwork and support non incumbent broadband initiatives.
And I'm going to say again, require Frontier to relinquish CAF monies in geographies that are not being used. And frankly, Mono County was beneficiary of several public utilities commission grants to an entity called RACE Communications. Those grants appeared to have slipped through during the Verizon Frontier transition and if Frontier had opposed them, none of those projects would have occurred. And I believe that's my last slide. I am available for questions.
I want to extend my appreciation to my prior speakers for covering and reinforcing many of the points that I have addressed today. And I will be available for questions. Thank you.
Speaker 12
Thank you, Supervisor Stump. We'll go now from Mono County to Plumas County. Supervisor Goss, are you ready for your remarks?
Speaker 20
Yes, good morning. Thank you to the Commission and everybody for making this possible and giving me an opportunity to speak. I am on a landline because I cannot live stream because my Internet is too slow. So you just get my voice today. I do want to go back and complement all four of the previous speakers.
All of the issues that they spoke of are definitely happening here in Indian Valley, Plymouth County. A little background on Plymouth County, Indian Valley, thousand to 18,000 people in the county, one incorporated city on the Eastern Side and old logging communities, mining, which has turned into basically just the shred of what's left over of mining and logging and turned over to governmental agencies, so on and so forth. I've been serving on the Board for eight years. I am currently the Plymouth County Rec Representative for RCRC, Regional Council of Rural Counties is what it used to be called. But anyhow, going forward, I'd like to talk a little bit not so much about what the previous four speakers, I'm going to come in an angle from the small business side, which we own a pharmacy here in Greenville, and for more of the governmental side and a project that I worked on for a little over fifteen to twenty years with fellow supervisor, Robert Meacher.
We'll start off with the World 20 Project, which I'm not sure if everybody is familiar with, but it is a cooperative project with PG and E, Frontier, any communications company and Caltrans to beautify your community with new sidewalks and street lighting and so on and so forth. And we had spent fifteen to twenty years, like I said, in the works and planning this project and we're just getting ready to break ground and set forth with the project when, Frontier decided that they were going to pull out and put the, jeopardize the project, completely, which was a no go for me and a lot of others who had spent so much time on this. And went back and forth with Frontier for quite some time, went to the national level, all the while as they are advertising on the radio how that they support rural communities and have all of these different contests and everything to help out rural communities. And I'm listening to our reps saying, No, we're going to pull the plug on a 15,000,020 million dollars project. I worked diligently with them, and, we finally came up with a compromise, which we had to scale our project back, to just the Highway 89 corridor, and they reluctantly went ahead and put their lines underground, but we weren't able to do the whole full build out on our project, which was completely unfortunate because we were trying to attract small business to our town and tourism and so on and so forth.
But that was just a real prime example of how Frontier had has been dealing with us and that's just on that side of it, just the customer service side, so on and so forth. But the one thing that really did it for me is when I had a couple of new businesses come into town and set up shop and went to go get their Internet service hooked up and they were told that there were no more blocks available and that they would have to be put on a waiting list to be able to get Internet. Two of those businesses were right next door to my pharmacy, which I extended my wireless to them, which inevitably slowed my wireless down, but until they could get hooked up two to three months later, because there's no other providers. There is a wireless company, Digital Path here in the area that has some coverage area, but that's just if you're in front of a mountaintop. So we did work with them and to be able to get some Internet here, but the blocks are still unavailable.
It's, like Fred was saying earlier, all aged infrastructure, copper wire. I have heard that there is glass, there is fiber optic here in town. Going forward for Frontier, I would suggest that strongly suggest that you work with your partners because we have on either side of us up in Susanville to the north of us PSRAC, which is Plymouth Sierra Rural Electric Cooperative has pulled fiber optic cable from Reno all the way to the Diamond Mountain Casino over there and in Quincy to Feather River College. But those two cables stopped and dead ended because they couldn't make the circuit to connect in the loop through Frontier because they would not allow them to hang anything on their lines. And so I would strongly suggest, and a plan going forward for at least for Plymouth County is they make that connection and make that loop because the fire that happened outside of, the Hog Fire, I believe is what it was called, outside of Susanville burned up their copper lines coming over servicing Plymouth County and we were down our businesses all down for at least I think three days, putting out here at the pharmacy, putting out 1,000 prescriptions not knowing whether you're going to get paid or not is not exactly the way you want to do business.
So it's the redundancy needs to be upgraded. We need to have backup available. As Fred was talking, when the power goes out, we have issues. There's no backup. The technicians, just like Fred said, know how to fix it.
They know there's glass here, but there's no empowerment available to those folks. So again, I don't want to go over all of the other comments from all the other speakers and I'd rather get to the questions if you guys have any. And that'll conclude my comments. Thank you.
Speaker 12
Thank you very much, Supervisor Goss. And for you and all the other panelists, we appreciate your detailed remarks and your examples. We'll begin our question and answer period now. First, I will ask the commissioners for questions and follow-up, and then we will go to the phone lines where each speaker will have one and a half minutes. All five commissioners are present now and I'd like to take any questions from them.
President Thatcher, if you have any, you're a good place to start. Well, you very much, Karen, and I really appreciate this panel. Interesting, very telling. Greatly appreciate the frankness and the good recommendations that have been made. I have a question for both Fred and Kevin.
One I'd like to know what community you're calling from Fred and Kevin too. And both Plumas and Mono experience PSPS. I think that you said you represent the southern part of the county. And that part of County had several power shutoffs in the last last year as well as this year already And I'm assuming all lines go down at the same time. So you don't have power and you don't have any kind of communications abilities.
Is that correct?
Speaker 19
Okay. Yes, first I am calling from Crowley Lake, which is on Highway 395 about 10 miles south of Mammoth Lakes. It's where I live.
Speaker 12
I know 390 very well. I grew up in Carson City, Nevada. So Okay. And my my family is a pioneer pioneer family from Smith Valley. So I know and I was a ski racer, so I spent a lot of my youth at Mammoth.
Speaker 19
It'll be interesting to see how Mammoth deals with COVID and reopening. Public health, California public health as dealing with cold weather environments is something that they're having to learn about as we go forward. To your other questions, yes, several PSP events, circuit information through the original ones was very vague from SCE. This is an SCE County, not PG and E. To their credit SCE has improved that information quite a bit.
So we know which circuits will be impacted. Some circuits particularly seem to get hit every single time. And when the power goes out in those areas, yes, there is if phone service goes down with it due to a lack of power redundancy in the Frontier system. One of the reasons I do maintain an old landline is because I'm fortunate to have one of the main original Verizon offices in my community where the old phone system still will function even if the power is out. However, many of the other communities do not have that advantage, if you will, and suffer outages.
And when that happens, if that is in a community that also does not have cell service and much of my district does not have cell service. My cell service coverage in my area is confined to one company and I do not use that company because half my district is on AT and T and half is on Verizon. So I just picked AT and T to serve my folks. But when you have no high speed internet, you have no voiceover potential, even when you have power, you have no cell service and you have no telephone, You're down to driving down to the highway and flagging somebody down hopefully they have a satellite phone. Hopefully that answered your question thank you for asking.
Speaker 12
Yeah we've been the commission has active in making sure that there was good communication between both Edison and telecommunications companies that serve the Edison. Service area as well as PG and E so something that I'll I'll follow-up on. And Kevin, same question to you regarding the PSPS that Plymouth County has experienced and what happens to your community when it comes to no power and no phones?
Speaker 20
Sure, sure. First of all, I'm calling from Greenville, California, pretty much the center of Plymouth County. When the power does go down here, whether it's winter storm related or PSPET, PS related, Here in Greenville, there is a generator that kicks on at Frontier's thing here that does reenergize the line. So I will say that if you have a generator and you're available to get your power up and going or you have a old fashioned princess phone that plugs right in, you will be able to call out normally unless there is some damage to lines such as I alluded to earlier during the hog fire where the main line coming out of Susanville was completely damaged and took them three or four days to repair with no redundancy or no backup. But I will say that there is a generator here that does pop on and so when we are able to get our generator up and going here at our store, we do have Internet capability, though it be limited.
But yes, it is available.
Speaker 20
know, I have a refrigerator full of about 50 to $60,000 worth of medications that I also have to maintain. So it's it's critical that I have communications with my modem that will start my generator because I live about half an hour out of town. Either I have to come in and manually start up the system.
Speaker 12
Okay. Thank you both Fred and Kevin. Appreciate your answers. That's all, Karen. Okay.
Thank you very much. Commissioner Guzman Estevez, do you have questions for the panel?
Speaker 3
Thank you, Karen. And thank you again to all of the speakers and all the dedication that you have to your communities and all the customers that reside there. I have a lot of questions. Some of them are more for trying to understand why Frontier has really lacked a follow-up here. And I certainly, I think it was Matt that mentioned or maybe it wasn't.
I can't remember which of you mentioned the challenge process. Maybe it was Supervisor Stump and how that's an issue that I think is particularly outrageous in that not only is there a commitment to upgrade the infrastructure but when there is local innovation and they're coming in to really put a stop to that. So I certainly would like to hear more about those details. It doesn't have to be today because we need to ensure that in this process or in other of our processes that we are not allowing for that innovation to happen so that folks can actually get service. I did want to ask perhaps a question.
I think Matt was one of the folks who said, you know, Frontier has kind of put out this concept of ImproveCo and InvestCo. And my biggest fear is that the ImproveCo territories that might frankly overlap with your community Maybe something that they're looking to do less with or potentially sell down the line. I really don't know. But the fact that they've made this bifurcation is concerning. And, know, Matt, you made kind of an offering of a discussion of a potential option.
I wonder for Dory or Fred or Antonio or anybody else, Is that something that you think is an option for you? And I don't know if I'm being clear here, maybe you can maybe Dory, if you want to start and maybe go through the line quickly.
Speaker 15
I mean, we open to those ideas and suggestions? Absolutely. And I think that Matt hit on some very important and key points that we have
Speaker 17
Commissioner Seves, this is Jose Antonio. Absolutely, I'm open to that as well. I think that there's been a lot of lessons learned through this conversation. I know it's pretty tough to hear some of the comments, but communicating the truth and then using that as the base to move forward. My other concern for me is Frontier if we're not to move forward and Frontier was to start selling things off, would we be in a better spot?
I don't know if that'll be the case. So that's why I made a comment online here about the MOU between Frontier and CTF and the public benefits and getting them back towards economic health. So I'm definitely open.
Speaker 13
I can't yeah I can expand on that a little bit so. I think the biggest fear is that that we're going to see two different parts of frontier the part that they support and the part that they don't support. And the failure and the widening of the digital divide in that area where you're trapped in a frontier property that that doesn't have support and doesn't have a future. So we we would be more interested in having discussions with Frontier about, you know, carving off that asset and right of way and and the opportunity there to maybe do something locally instead of have it become dormant, but still part of the company that's fighting against you bringing in innovation.
Speaker 19
Yes, I would concur with those comments. When you talk about Frontier's future checking share price today, it's $0.26 a share. Verizon on the other hand is $59.66 a share, calls into question the viability of the company as a whole. My concern is as they spin off potentially pieces that are not producing for them that the situation just described by Matt could occur. From a county perspective, we are interested in any discussion that will enable any resident to have high speed internet and reliable phone service and communications.
Speaker 12
Thank you. Supervisor Goss, would you like to take part of that question?
Speaker 20
Yes. Just I would concur with everybody that spoke, but I would also say that we too would be interested at a county level of any kind of a maybe an independent district or an independent company or something. Mean, I don't think the county wants to get into the Internet business, not necessarily, not right now anyway. But it would be a proactive and productive conversation to be able to have with some of our partners and have Frontier at the table willing to maybe carve some of their stuff out or carve their sections of their infrastructure out to be able to give the citizens of Plymouth County good, fast, reliable Internet. I know that, a lot of folks I'm running for reelection and one of the individuals that's running against me is really high on the wireless aspect of providing Internet up here, which has its drawbacks as well.
But I think that if we can get some good fiber up here or activate the fiber that's already here and connect the other company together to us, I think, would be so beneficial and would look forward to those conversations.
Speaker 12
Thank you. Commissioner, do you want to maybe go to the other commissioners and then come back to you? Yes, please. Okay. Commissioner Rexhoffman, do you want to go with the question?
Speaker 6
Thank you. I don't know if we have the ability to have Allison or Kevin from Frontier respond to some of what we've heard. Would if so, I would like if they could respond briefly, Dory and Matt raised some very troubling concerns, which of course are not new, but particularly highlighted vividly how the lack of investment and the opposition that Frontier has been interposing to new creative approaches and service configurations to providing modern Internet speed while arguing for all legacy solutions. I don't know if Allison or Kevin are still on, if they could respond in particular to Matt's criticisms also Supervisor Stump who indicated that Frontier has not only been not proactive but it's actively blocking other solutions. If not, we can ask them to respond offline after this hearing.
Speaker 8
Yes, I'm happy to Commissioner to give a bit of a response. I mean, I think at the high level, the speakers are all illustrating some of the challenges that we face in serving some of our rural and low density footprint and the expense and difficulty associated with doing that is, you know, quite frankly, one of the reasons we've found ourselves in financial distress and needing to avail ourselves of the Chapter 11 bankruptcy reorganization process. We have worked to deploy services independently where we could, and we have also utilized CAF II funding and CAFF funding where that's been permissible. And I think in all of the areas represented today, there have been some, you know, CAF two investments. I guess I would just remind the commission and the participants that it's the FCC who identifies those locations, not frontier in terms of eligibility where the money can be deployed.
And sort of similarly with the CASF, you know, it's the commission that makes the determination of whether the program, you know, the project is, you know, should be funded. I can tell you that from Frontier's part, we typically focus our CASF grant proposals on, you know, really those areas that are rural and underserved and where we are looking to be able to maximize the impact of the state funding and really be a good steward of that funding. We have made broadband improvements projects in many of these areas. Just actually this summer in Telomne, we upgraded this very old Sonnet network. The speaker is correct.
There was some old facilities there. We upgraded it to deploy a 10 gig circuit and that will be a big improvement for that area. It expands Ethernet access and capabilities there, and it also relieves broadband congestion. And, you know, those are that's just one example. There are other projects in other areas.
You know, in Plymouth County, we have a two phase project in the Northeast Area. One has already been funded by the commission. But then there is another project that we have actually pending before, the commission for approval. This is one of our fiber to the premises, projects, and you know that has the ability funded, to provide some significant additional capabilities in that community. So, you know, I definitely hear the panelists.
I'm not discounting the panelists' frustration or experience with Frontier in the past, But I do think it's illustrative just to point out that, you know, these are very difficult areas to serve. And, you know, we take our, you know, responsibility to do our best given the constraints that we just have as a private company that doesn't get a return on every investment that we make to improve services and expand them where we can.
Speaker 12
Thank you, Ms. Ellis. Commissioner Randolph, I'm looking at you. Would you like to take a question?
Speaker 5
Yes. One of the things I found striking about some of the comments was particularly Matt's comments about sort of the stop and start of the contact like, oh, we're going to be really enthusiastic about working with you and then we're going to disappear. Do you have do any of the panelists have examples of companies that are doing it correctly that might be sort of ones that you could recommend to Frontier in terms of good examples of community engagement from companies? Because I got
Speaker 5
be doing this all that well. So I would love to know if there's anybody who is is more effectively doing this kind of work.
Speaker 13
This is Matt. I'll I'll chime in on that real fast. The thank you, commissioner. The experience we've had with all of the carriers in in our region in Southern California has, you know, not been a 100% what we've been interested in dealing with. It's been very difficult to get to the right people at an organization to actually have meaningful conversations where we can find solutions for getting access to bigger broadband pipes, especially for the travel digital village network where we build our own resources because they're not building out to us.
Where we've had our best traction is through the state department, the CTO, and and the CIO offices of the state and having having those relationships and having those departments help us establish meetings and establish interaction with those carriers that we wish to engage with Carlos Ramos, back in the day, extended the state's, broadband pricing to tribes and, negotiation support, in getting into those meetings. And and we've taken absolute advantage of that offer back in the day, and it's how we have the the connections that we we have now. We have a connection to AT and T, which has migrated over to its Phoenix network connection which is you know far advantageous to us being on the scenic network and having access to all the resources of scenic as well. But even with CenturyLink in the in the Southeast part of the county. The the department helped us get in the door with and negotiate.
The state's rates. And then build a relationship where I can further with with that organization so. I believe the state has done a lot of work with us to be able to get a better result than I could get getting through the front door. I felt like I never got to the people that that could make these deals without that assistance so. Know, nobody none of them are perfect.
Some of them once engaged are much better than others.
Speaker 12
Do any of the other panelists have an example for Commissioner Randolph?
Speaker 19
This is Fred Stump and thank you for asking that question. We do have a local entity that serves has tapped into the Digital three ninety five fiber optic system has actually constructed fiber optics to homes. That's a race communication grant funding from the PUC enabled that company to reach out in several of the county communities. Their pricing is reasonable and in terms of functionality and reliability they are clearly superior to the areas served by Frontier. Frontier does advertise DSL in some communities, but that DSL relies again on old infrastructure and does not reach has a limited reach from where the pointable region is on there.
And the back to the Digital three ninety five component, it is there. It is just not being utilized currently by this company in a way that could alleviate some of the issues that I spoke about.
Speaker 20
I'll just chime in real quick, Kevin Goss. Just talking about the fiber optic that I was mentioning that was up to Susan Bill and out to Federal River College. It was put in by Plymouth Sierra Rural Electric, Cooperative who was an electrical company, mainly and then went into the digital arena, with the funds and was able to bring that fiber optic to Plymouth County, whereas it since has just stopped on either side of Indian Valley, Chester, Lake Alminaur. Lake Almina is one of the huge areas that is underserved well as well and is one of our most growing areas as far as folks coming up from the Valley and us growing our county populations. But anyway, Plymouth Sierra Rural Electric I think would be a good contact, good example.
Speaker 12
Commissioner Schiroma, do you have a question you'd like to ask the panelists or multiple questions?
Speaker 23
This question is for Frontier. If Allison is still on the line. So I live in Sacramento and years ago Frontier was in the South County area Elk Grove and anecdotally even then we just hear a lot of complaints. At that time, I was serving as an elected on the Sacramento Municipal Utility District Board. And we launched an initiative to garner 95% customer satisfaction from our customers.
So my question is for Frontier. Do you have a written policy on customer service satisfactionexperience? And You've heard the complaints and the complaints have been going on for years and our cab unit has received thousands of complaints. Do you have a root cause analysis for? What's going on other than just putting up with complaints?
Do you have? Have you ever done a root cause? Assessment of yourself. On what is causing it and what needs to change? I mean, if you haven't, that's also the answer to the question.
So written policy and then also have you done a deep root cause analysis on what's going on with that?
Speaker 8
Yes, I am. And I have actually turned on my video. Can you see me? Yes. Perfect.
So, yes, generally, I mean, we do look at the complaints that we get. We do a deep dive on various complaints to identify the areas and the issues that consumers are having with us. As you can imagine, because our services so particularized and you know, a situation is different based on somebody's distance to our equipment, sometimes the complaints are often quite specific to a specific customer. We do value customer service. We do value the providing good customer service and we measure ourselves on what customers are saying about their experience with us in the marketplace.
We have had a variety of initiatives over the last several years to work to improve how customers perceive their interactions with us. We've introduced a number of additional tools that enable customers to communicate with us in formats that they are increasingly at least in the more urban and suburban areas wanting to utilize such as through chat. With our new CEO, we have been implementing some additional focus on customer service. So you know, it absolutely is something that we care about. It's something that we train our representatives on.
It's something that we value as a company. But, you know, I think people can appreciate from their own personal experience. It can be highly frustrating when your telecommunication services don't work because, you know, we are all increasingly reliant on our various forms of communications and that leads to a high level of complaint, whether it's about Frontier or any other telecommunications provider. And just as an industry, it's an industry where there is a high level of customer dissatisfaction versus customer satisfaction. I'm certainly not using that as an excuse in any way, but just giving it as a context that if you look at how all communications carriers perform, the customer ratings of their service or their experience with the company are generally not as positive as any of the carriers would like.
Speaker 23
Thank you. And your policy, yes, I mean actually, where your Board of Directors has adopted a policy on customer service as a priority?
Speaker 8
We don't have to my knowledge, we don't have a board level approved customer service policy. But as I said, it is something that we train our representatives and technicians to. It's a part of our strategic initiatives. And so in that sense, it's something that management is very much aware of and very much focused on. And we have been seeing incremental improvements year over year, month over month, year over year, but we're certainly not at the level where we want to be quite yet.
The restructuring is actually a very important part of our ability to deliver an improved customer service experience to our customers. With the financial pressures that we have been shouldering for the last several years, obviously that puts a lot of pressure on the organization. Just generally, it puts pressure on the ability to go above and beyond and do for the customer what we would otherwise be able to do if we didn't have the financial constraints that we are currently trying to eliminate frankly.
Speaker 12
Thank you. Commissioners, I know that you have many more questions and follow ups, but we have planned for time from the phone lines and email for questions for this panel and we have many, many people on the phone. So with your permission I'd like to move to the phone part now, if you don't mind. We will now open this time for public input question or comment. Each speaker on the phone will have one and a half minutes to speak or ask questions of the panel.
So, you will hear a bell sound when your time is up and I ask you to please respect that time because there are many of you there. I will ask Yella to help me with the emails after the callers have spoken. Operator, can you please announce the first caller?
Speaker 22
Good morning, commissioners and good morning, panelists. Thank you so much for the panel. It's been a wonderful conversation to really get you all together. Just a couple of thoughts and hopefully questions actually. So TURN is I guess what I hear is a theme that the Commissioner has commented on as well, which is a lack of cooperation by Frontier with third party projects.
All of you are thinking creatively. All of you are working to try to resolve the situations locally. And there does appear to definitely a lack of cooperation by Frontier on many levels and that is troubling. Turn sympathetic to the high cost and the COLA obligations that Frontier faces to serve these areas, we're cognizant of those and we are sympathetic to those. But we also believe that there's lots of tools that Frontier has to address the high cost of serving these areas.
There's funding federal and state funding and work that the Commission has done and we all have done to try to help Frontier serve these areas. And yet we're still hearing about a lack of willingness to engage in local projects.
Speaker 22
have two questions related to the restructuring. I want to make sure that this issue, this lack of willingness to cooperate is solved by this restructuring and that this new group of investors, the new Board of Directors is coming in willing to cooperate And in making their investment decisions, this BESTCO and PROVECO issue, I want to make sure that part of the INVESTCO decision is to bring in these folks that are talking today and others to have the investment be joint with these organizations. And therefore, I'm hoping this docket can document both the right of first refusals in CASF applications that Frontier has done plus other less formal refusals to work with these organizations. We can document them here and ensure that the investment decisions being made at the management level address those. Thank you.
Speaker 4
Absolutely. We have two emails. Let me start with the first one. This is a question for Dory Bates. I'm going to read verbatim here.
This is Cameron Reed with the Public Advocates Office. Just a clarifying question regarding Comcast service. You said you went to Comcast for Internet service for the Miwok government and businesses. Does Comcast offer residential service to the households in your area Or is it only providing business service? If it does, how many households can get Comcast service?
That's the first question.
Speaker 15
So the business entity side went after switched over to Comcast because that was their really only alternative. And Comcast has not come into the residential side, which is individually each individual vendor is responsible. So we have not looked at extending the Comcast into the tribal residential area currently right now.
Speaker 4
Great. And there's an additional comment from Reed from Cameron Reed. I just want to thank the panelists for their insightful comments. I also want to say I appreciate Mr. Ran Tanen's choice of background image.
We have a second set of questions here. Me just open this. Go ahead, Yawa. Okay. So this question is from Robert Longer.
To whom it may concern, on behalf of the Communications Workers of America, CWA, District nine, we would like to submit the following questions for any of the panelists on the panelist discussion one, community experiences and needs to answer. Number one, has Frontier informed you if your areas will be considered InvestCo or ImproveCo if this bankruptcy is approved? Second question, what is your view of how Frontier is planning to separate California regions into InvestCo and ImproveCo? That's the end of the question.
Speaker 19
Supervisor Stump here. I can answer those quickly. Question one, the answer is no. No information from Frontier on either one of those points. Question two, unknown because of the answer to question one.
Speaker 20
Supervisor Goss, answer to the first question is no. Answer to the second question again is unknown because of the first answer.
Speaker 3
Yalla, to interrupt but just before we go to the next question, I wonder if we can get a commitment from Allison to at minimum for the panelists here with us today, if you could get that notice to them as to whether or not each of their communities are a part of ImproveCo or Invesco?
Speaker 20
Yes, obviously, this is a communications company that we're dealing with, so communication is utmost.
Speaker 11
So, Commissioner, this is Patrick Ross Ball for Frontier. I think to the extent that that question that you'd like an answer to the question about Improveco and Invesco, I think Kevin Seville might be the right person for it. So if he's still on the line, we can probably see
Speaker 10
Yes, I'm here Patrick. So commissioners in terms of the question, the differentiation between
Speaker 10
I know to some that has a negative connotation. But our expectation is that California is a very important state to us and we intend to invest in the state of California and to bring fiber to additional households to the extent we can. The reality is that no company it hasn't happened to date and it probably won't happen in the foreseeable future has enough capital resources to deploy fiber to every single household. There is a need to evaluate where it makes sense from a financial and practical standpoint to expand deployment of investment in fiber. And that being said, the areas that don't get new fiber deployment are not necessarily going to be neglected.
Those areas are also going to receive investment enhancements that will improve service. So this delineation between Invesco and Improveco clearly California is going to be a state we invest in and the areas that don't get expanded fiber will get improvements. In terms of identifying the specific areas, one of the things we need to do is when we're relieved of the debt obligations that we have today in terms of through the bankruptcy process is our new Board and management is going to undertake an evaluation and do engineering analysis and detailed review to determine where it can deploy additional resources in terms of either fiber or just improving. So, we haven't made that determination yet. So, with respect to the panelists, we can't today go and say this area is going to get fiber, this area is only coming to see improved broadband deployment.
Those decisions have not yet been made.
Speaker 12
Thank you, Mr. Savol. Yella, we are just a few minutes over time now and I would like to be respectful of everyone's time. I think that we had a plan for further questions and emails to be answered later in the day. Is that correct?
Or is there just a small number left now?
Speaker 26
Yes, we can have our any additional questions during the public comments in the afternoon. So if we don't get to all our questions right now, we will give them an opportunity to say that or they can also send a public written comment.
Speaker 12
Okay. Thank you very much, Danielle. I will turn this back over to you now.
Speaker 26
Sounds good. Thank you. I think we're having technical difficulties, which is timing because we are going to move to a lunch break. We will resume our program at 01:30 and we will begin with Panel two discussion. Thank you.
Speaker 19
And may I quickly say I have an additional meeting this afternoon. I will have to log off of this. Thank you again for the opportunity to address the Commission. My meeting this afternoon deals with another very noncontroversial topic, water.
Speaker 3
Thank you, supervisor, and thank you all so much for the panelists that made the time with so many crises that you're facing. I really do hope we can continue this dialogue. Have a good lunch.
Speaker 4
provided by communications division and Frontier. We are now going to move to our second panel discussion. Michael Minkus is with the communications division and will be moderating this panel group. Public input during the active panel discussion can be made by sending an email to telcoevents@cpuc.ca.gov. When it's time to go over the panel question and answer session, the phone line will be open to hear callers who wish to provide an input, and I will read back the emails in the order that they are received.
We will do our best to get through all these the emails within the limited time we have. Michael?
Speaker 18
Hi. Thanks, Yella. Could I get the next slide, please? So hello, everyone. I'm Michael Minkist.
I'm a policy advisor in the Public Utilities Commission Communications Division. And as Iella noted, I will be moderating this panel. I'll introduce the three panelists and share some of their background. Each panelist will get a chance to make some relatively brief introductory remarks in response to a question, and then we'll take more general questions. One panelist, Blair Levin, will be joining us about thirty minutes late and may make some remarks when he joins.
So with that, can we get the next slide, please? Joanne Jobes is President of CCC Technology and Energy. She's a nationally recognized expert on broadband markets and the evolving role of public private partnerships and the provision of communication services to the public. She leads a team that advises states, cities and statewide broadband networks. Next slide, please.
William Wallace is Chair of the Board at U. S. Ignite. He brings a background in telecommunications from years in the industry, most recently as the co founder of Digital Bride Communications, a venture backed startup dedicated to bringing four gs broadband wireless service to underserved portions of The U. S.
Previously, Bill was co founder and CEO of OnePoint Communications, which was purchased by Verizon Communications in 2000. OnePoint and its successor company, Verizon Avenue, provide bundled communication services to concentrated communities nationwide, including apartment communities, military bases, and rural areas. Next slide, please. And one more, please. I guess let's go back.
One, I'll introduce Blair Levin so we don't need to go over when he joins. Blair Levin is an attorney and currently a nonresident fellow at the Metropolitan Policy Program at the Brookings Institution. He also serves as the Executive Director of Gig U, the Next Generation Network Innovation Project, an initiative of three dozen leading research university communities supporting educational and economic development by accelerating next generation network deployment. Prior to that, at the Federal Communications Commission, Blair oversaw the development of the National Broadband Plan in approximately 02/2010, after eight years as an analyst at Legg Mason and Stifel Nicolaus. Before that, Blair was Chief of Staff to FCC Chair Reid Hunt from 1993 to 'ninety seven, where his work included overseeing implementation of the 1996 Telecommunications Reform Act and the First Spectrum Auctions.
So with that, next slide, please. I'm going to read through the questions from Panel one and this one background slide also, and then leave to the panelists to share some remarks. So two questions, both related to ensuring the company the Emerge company can serve all communities. The Frontier application is Michael. Separation of assets Michael.
And BestCo. Yeah.
Speaker 7
Sorry to interrupt. We're having a fire alarm go off right now in the auditorium in San Francisco. Can you please stand by?
Speaker 7
It appears to be a real fire alarm, Michael, so we're gonna have to head out of the building. Please stand by, and if you can announce to the public.
Speaker 4
Okay, thank you everybody. We are ready to start. Michael, please continue.
Speaker 18
Absolutely. So I was going to go briefly sorry everyone for the interruption. I'm going to go briefly through the two high level questions that the panelists will speak to, and then Blair Levin, the third panelist, will join us in about ten minutes. The questions are: one, do you have creative thoughts about how to ensure high quality continuity of service in improved co areas that may include rural, tribal, and low income areas? Question two is, what mechanisms, such as high cost fund support, capital cost subsidies, or others, might best enable the creative solutions that have been discussed.
So with that, Joanne, if you could speak to some of these questions first.
Speaker 21
Great. Thank you, Michael, and good afternoon, everyone. It's a pleasure to be with you. Let me share from my perspective as someone who develops strategies for public entities at the state and local level, including tribes, and someone who works pretty extensively on public private collaboration, I would recommend very serious consideration of what it looks like in areas where there's reasonable concern about the long term prospects for adequate broadband for these communities in light of the challenges and the chronic underinvestment to date and the current situation that Frontier is in and its plans. In light of that, I would recommend consideration of what it might look like for the local communities, the tribes and their partners to have the opportunity to take over ownership and control at a local level of the local assets and operations.
It's really impossible to think of any entity with a bigger stake or more motivation than the local community when it comes to this broadband future or lack of broadband future for that geographic area. And a takeover of assets and operations would enable that community or the tribe to prioritize as it sees fit, including economic development, student well-being, health care, the other kinds of policy priorities that are so foundational to why communities are concerned about broadband to begin with. That local ownership and control also enables a concentration of spending locally with all the associated economic benefits that comes from that and the long term multiplier effect that comes from that as well. That said, this is not necessarily a very straightforward or easy path. Even without the requirement of profit margins, communities will find these economics challenging.
And in large part, and not in substantial part, because the networks have seen so little investment and there are so many challenges, so much need for upgrade and so such high operating costs associated with supporting legacy infrastructure. And the communities and tribes, if they were interested in this kind of initiative, and I would anticipate many would be, wouldn't have any of the scale advantages of a company of frontier size. So I wouldn't assume that they can necessarily be able to do this more cheaply. And I'll talk in a minute about the things that I think it would be enormously helpful for them to have in order to be able to do it better. So they might not be able to do it more cheaply than Frontier, but they will certainly be more motivated, and they would operate the network and they would upgrade the network differently than any publicly traded company.
There's simply no way that a distantly owned company that has all of the considerations of a publicly traded corporation is going to make the same kinds of decisions that a local community would. So I would say that it's just critical to put in place tools to support the communities, these kinds of efforts, and to make successful operations and critically, the upgrades to better infrastructure more viable. Let me share with you what I think those tools would be. And I'll just very briefly run through the things that I think are important that, in my experience, have identified as the frustrations or the impediments that can be easily put in the way of a successful public initiative, what are the ways that those impediments can be removed? That's what I'll speak to.
And I'll give the caveat that some of these would be in the control of Frontier, others would be in the control of different state level entities. The first thing would be poll access, utility poll access with certainty guarantees regarding the opportunity to overlap and cost ceilings around make ready so that the timing and cost of make ready could not be a means of slowing or making infeasible or more challenging an initiative. Second thing would be rural interconnect obligations on the part of Frontier to enable locally owned networks to connect to major Internet points of presence in the urban parts of California or elsewhere, and long haul pricing at reduced or reasonable cost calculated to actually enable success by the local communities. In short, really making sure that they do not end up with an island, that they actually have a network that is connected at reasonable cost to the rest of the world. Third, I would, in a perfect world, want to see state broadband funding streams structured to support and enable community and tribe involvement, that's a number of different things.
The first is that the localities and the tribes must be eligible entities for public funding for broadband. We are frankly all over the country past the point where it's feasible to exclude them, but certainly given what we're talking about here, it would be critical that they have the same opportunity to compete for public funding that any other entity does. Second, the state funding programs should be structured so that they can be used as a match for federal grants, allowing the communities and the tribes to compete for federal grants more ably. And as part of that, we'd also recommend I'd also recommend consideration of structuring the state grants so that the federal grants can then, once attained, also serve as match for the state funding. This, in my view and experience, is a best practice.
It's been done very successfully, most recently by the state of Maryland that has enabled tapping into substantial federal dollars by enabling this matching mechanism. Third, public private collaboration should be eligible for state funds. So the public applicant such as a county or a town or a tribe wouldn't have to commit that it will serve in all roles, but it can work with private partners who, for example, might be a network operator or an ISP on the network with the public entity as the owner and the owner of the infrastructure who will maintain and upgrade the infrastructure. Fourth, we want to see very reasonable phased transfers with performance obligations that facilitate an effective transfer that enables the public entity to take over in a way that maximizes the chances for success. Fifth, it'd be critical for Frontier to have data sharing obligations at the most granular level possible, ideally the address level, when there's any consideration of the scenario in which a community or a tribe takes over the assets just so that sufficient data is available to make that determination.
And then finally, and these are all very brief and could each stand many hours of discussion, but the final item is that to enable everything that I've just discussed, ideally the communities and the tribes would have the opportunity to get state support for planning and also mechanisms to achieve efficiencies in procurement for labor materials and services through aggregation. And those, I
Speaker 21
of the ingredients that could make for a feasible way of securing the broadband future of some of the areas that are otherwise likely to struggle for a long time.
Speaker 18
Thank you and greatly appreciated. Bill, if you'd like to take a few minutes to speak to those same two questions.
Speaker 1
Sure. I agree wholeheartedly with what Joanne had to say. And we've just finished a study at U. Ignite that looks at alternative models for deploying broadband in creative ways. There are five models.
It looks at taking a part of network into its five components, the rights of way that a city may or community may own, the middle mile, the last mile, operating the infrastructure and then servicing the customer. And if you look at the network that way, of course, there's a full municipal model or full tribal model where everything is done by the municipality or the tribe. But there are other models that have been successfully deployed around the country. In fact, we've looked at roughly 1,000 what we call municipally enabled models. One of them is one extreme is a full municipal model.
One of the other extreme is a full private model with some more active municipal involvement. But a second model we've looked at, which might be applicable in some cases around California is what we call a publicly owned privately serviced model. It's being deployed in Westminster, Maryland, where the community has actually, of course, owned the rights of way, but also owns the middle mile and the last mile. But then as a service provider, in this case, a company called Ting providing the operating infrastructure and providing the servicing and last mile activities. A third model is a hybrid ownership model, which is being deployed in Lincoln, Nebraska, where the community or tribe does the rights of way, of course, owns the middle mile, but then brings in industry service providers to provide the last mile, operate the infrastructure and service the customer.
Yet a fourth model, which we're seeing in force in California, is called the private developer open access model, where the of course, the public entity owns the rights of way, but then a private developer puts in the middle mile, goes to last mile, operates infrastructure and has an open access to Internet service providers. This is an up and coming model. We haven't seen many of them around the country. It also lends itself to innovative wireless technologies. It's kind of a neutral hosting point where you would be able to bring in alternative wireless.
All of these, as Jo Anne said, are potentially expensive, potentially complex. We're about to release a decision tree model that communities can use to decide which one of these five models might make the most sense for them, given the assets they have, the availability of internet service providers, the capital, the partnership options and the willingness to take some risk versus not take some risk. So it's a model that I think could help some of these communities mix and match their own assets, the municipal assets, tribal assets with some private assets to pursue creative models to make sure the insurance levels are increased in these areas. This is something that I also agree with Jo Anne in terms of tapping into state funding. I'm not as close to the specifics of the state funding models as I think Jo Anne and Blair are.
But my sense is that if you involve the community in a public private partnership, we might be much better able to tap into exactly which public funds are needed where. I have a sense that it's pretty much top down from carriers down today. But if you involve the community, I think the communities may be able to define where not only where the network system should go, but also how some of these high cost funds could be applied, lifeline funds could be applied and more optimize use of these local funds, both federal sorry, state and local. So I guess, Michael, to summarize my view on the first set of questions, I think there are creative public private models that can be deployed creatively. I think there are creative offshoots to these models, often involving wireless, that if you have a public private model, you're more likely to be able to tap into.
And I think there playbooks perhaps that communities could be given in terms of how to work with their local provider or when they become a local provider themselves to tap into the California public purchase programs.
Speaker 18
Thanks. That's greatly appreciated. So there will be a chance for questions in a little bit. Joe, if we could go to the next slide. I think we'll actually want to go two slides ahead.
And Blair this is a link to The U. S. Ignite report. Blair Levin has joined us, and we can go one more slide. Sorry, Joe.
And we have another series of questions, and these relate to the practicalities in a transfer or merger proceeding of what conditions might be imposed, how they might be monitored and or enforced. So with that, I'm glad to read through them, but I am glad to pass the baton to Blair if you'd like to go through some of your high level responses to some of these questions or make some general remarks. I think you're muted. We can't hear you at the moment.
Speaker 27
Okay, great. Thank you very much. Again, let me apologize for being a few minutes late. I think every transaction, even the ones that are quite successful, have a problem with the enforcement of conditions. If you look, for example, at the history of the FCC with merger conditions, it reminds me of that line from Pirates of the Caribbean where someone says, here's the rule book, you're violating the code, and they go the other guy says, well, it's really more like guidelines.
And you could look at a number of different transactions where the FCC has approved it with a number of conditions, and then those conditions either get dropped or they get mitigated. Because the incentives to promise anything in the context of a legal proceeding, like a merger or bankruptcy proceeding is pretty great and the company knows, and I'm not saying it's doing it in bad faith, but the company understands that whatever obligations they need to take on to get the transaction done, they can take on in the full knowledge that over time they will be able to essentially relitigate those issues. And so I think aligning the incentives the right way is it's difficult. And I think we should face that difficulty square on. There are a number of conditions that I think people would like.
Certainly there are build out conditions. Certainly there are service obligations. Certainly there are obligations to meet a certain standard for outages and things like that. The problem is that when things go south, that is to say if things aren't going well, or if there's some event like COVID which changes the economy in various ways, it's pretty easy for the company to say, whereas I have obligations to multiple parties, my first obligations are returning revenues to shareholders through whatever means, whatever kinds of distributions they do. And the public obligations tend to go to the end.
So what I would suggest is a couple of means a couple of ways to make sure that the public obligations and we can talk more about what they should be, but the public obligations are met are, number one, the PUC has to have very timely data on really an ongoing basis. As a practical matter, companies report to Wall Street on a quarterly basis, but as a practical matter in today's world, they're getting data a lot faster than that. And I think there's an interesting question of whether and to what extent the public sector, particularly in the situation where someone is coming out of bankruptcy and so the economics where one can be optimistic about it are nonetheless tricky, whether there can be access to much more timely data so that you get advanced warning of when there's likely to be a problem or certain benchmarks aren't going to be met. The other thing is the process of enforcement. And I would simply say, I think this is one where what you want to avoid is a situation where the company knows that they can essentially tie up the PUC in court for a long time.
And so by the time all of the normal legal proceedings are done, lots of negative things have happened and kind of the equities in the ground are already more problematic. And so the question whether it's a special master or some kind of vehicle that allows the PUC to more directly and quickly force the company to live up to its obligations may well be called for. And then Joanne mentioned in her comments something that is certainly worth considering, which is if they don't meet the obligations, are there parties that can step in, particularly public parties that can step in and take over. And for that to be able to happen, there are certain things like data sharing that the company needs to be obligated to do.
Speaker 18
Thanks. That's helpful and appreciated. Joanne or Bill, would you like to speak to any of these topics now?
Speaker 1
just say taking continuing off where I think Joanne and I were in terms of local community involvement, I think and also Doreen Beats, who spoke from the Tuolumne band earlier today. This is maybe something that's never been done, forcing in the case of IMPROVECO, forcing requirement or enforcement that there'd be a community participant in a planning process to decide how they're going to provide broadband to the right parts of the full community, right? So that you have a comprehensive plan locally that can be used to guide either the public or the private deployment of facilities, but also to apply to the various state funds that exist, the federal funds like CAF and others, and the rural and then take part of the Rural Digital Opportunity Fund Auction. I think having some requirement that there is local participation, particularly in an improved code, would go a long way.
Speaker 21
Let me echo that by saying I completely agree. As I look around the country, particularly at state funding programs, the ones that incorporate and even mandate local involvement are just more successful. And frankly, federal programs that do that are as well. And there's just a very significant difference between an entity making a decision to invest dollars federal, state or its own in a community that it knows and has spoken to and one where it has never set foot but has simply applied through an auction process of the FCC. They're very different outcomes.
They have their own benefits and negatives, but generally that public involvement will have a significant difference in terms of outcome. Let me add just a couple more thoughts about conditions, And I defer to Blair entirely on the realities of what gets enforced and what doesn't, other than to say that lot, just as someone who works with communities and states all the time, not all that much gets enforced. But if I were looking at things that I thought would really make a difference, I've already talked about open interconnect obligations in rural areas. And that doesn't just mean that fiber is going through, then there's an interconnection obligation in San Francisco. It means that there's an interconnection obligation in that rural community where that fiber passes.
And that potentially involves more cost and challenge for companies. There's no question about it, but it also has a qualitative and quantitative difference in terms of potential outcomes. The address level data we talked about already, just general transparency requirements would be enormously helpful. And the final thing that I've spent a lot of time observing in terms of rural upgrade patterns and the various ways that the funding streams flow is that there's the way the mechanisms are set up, the incentives are for incremental spending, not for significant investment upfront, do it once, do it right, you've got five of them. Instead, we have ongoing incremental costly spending that in the medium term, not even for the long term, but in the medium term is more expensive than doing it right in the first place.
And as a result, it becomes highly profitable to not upgrade in a significant way. Now that's a national observation. I'm not speaking to Frontier in California, but I would say that if I were creating requirements based on public benefit or otherwise granting the requests of larger companies, I might want to think about what the upgrade path needs to look like. I might also want to think about the geographic differentiation as between the areas that the company might want and the areas that it doesn't want and spread it among those two rather than allowing for cherry picking, where the economics then become that much more challenging for the areas that are not considered desirable. So something more of a requiring spending across a larger area, effectively normalizing across a larger area for the economics rather than allowing selection based on what is most desirable.
I'll stop there on that topic.
Speaker 18
Great, and thank you. I have some follow ups, but I will save those for a moment and go to the question and answer portion. So I know we had some a little bit of excitement there, and we're offline for a moment. But I would plan to ask the commissioners first for any questions and follow-up, and then we'll go to the phone lines and email questions. So with that, Commissioner Guzmana Sevres or other commissioners, do you have any follow-up questions?
Speaker 3
Thank you. And thanks again for the panelists for their patience on another twenty twenty lively event that's keeping us going. And I'm glad it was just a false alarm there. Actually, some of this was you were starting to answer, Joanne, towards the end here. In the question I have, I think you've all laid out some great visions about the options and opportunities.
I like the term publicly enabled, am I saying that right? And all the options that exist and guess kind of bringing it back to this transaction in particular, what are some key obligations that you think should be put in place? And you've mentioned some, but to really great suggestion on having community participation and community presence in the planning process, timely data, and what are some of the others, you know, in terms of, how we functionally do some of this create these opportunities? Know it's still a general question, but if you could maybe kind of narrow into the transaction points and any further thoughts that you have there.
Speaker 21
let me put a caveat on this that I am a broadband analyst and business strategist, so I can't speak to what can actually, as a legal matter, be done. I can speak from a business standpoint about the kinds of things I would want to see. With the hope that enforcement can be vigorous, I would want to see medium to long term plans around upgrade and investments, including commitments about how federal funds are spent. And in the event that those benchmarks are not reached, that the opportunity for local communities to step in and take over would be
Speaker 21
consequence. And ideally, from a business standpoint, the funding mechanisms that would otherwise support the company would then be part of the solution for the local community or the tribe. Again, I can't speak to what's feasible from a legal standpoint, but certainly from a kind of business incentive standpoint, that seems like it might be a reasonable path forward. I also just coming back to the point I made at the end of my last set of remarks around that normalization effectively as an economic matter that the upgrade path can't be only in the areas or the neighborhoods that are most desirable because it makes the ones that are left that are less economically viable, less and less economically viable as a result. And that I think speaks to what one of the panelists on the last panel said about the strong likelihood that we're going to see our digital divides as a nation grow in coming years, we are not narrowing the divides.
We are actually exacerbating them pretty significantly. And if the requirements and obligations on the company going forward are for things that are economically very attractive to it, but also matched by the pieces that are less attractive, that would potentially normalize across that particular set of economic challenges.
Speaker 18
And Blair, to you, and we can Commissioner, maybe you can paraphrase the question again as a refresher.
Speaker 3
Okay. Well, I wasn't sure it looked like Will was ready to go on it. No? Okay. I
Speaker 27
generally agree with what Joanna said. I think that point about if you take an area and you say we're going to now serve 60% of it, the remaining 40% actually becomes more difficult to serve is a really important point. Would also just note and I've done a bunch of writing in Brookings about this. As we see things like five gs rollout in the wealthier areas, as we see things like fiber rollout, and these are good developments, but they're going to roll out in the wealthier areas, they're going to lower the price of the high end product in those areas. But in the lower income areas, you're going to have fewer choices, the quality bores, and you actually will ironically get a situation where the prices may be higher because
Speaker 27
that lack of competition. So I think that's a major public policy problem that frankly we've been addressing ever since the breakup of AT and T. With a monopoly, can just kind of regulate them in various ways. You get a lot of benefits of competition, but competition tends to drive starts with kind of a cherry picking element. That's I don't mean that in kind of a negative way.
I'm just saying the law of economics means that the new competitive companies are going to go to the areas where they can get the greater return and public policy has to understand that. I would just add to what Jo Anne said in that light that not only do you have like larger build out obligations, service quality obligations, I think it's really important that the company agree to some kind of low price entry level product for low income persons. There are a variety of different ways of doing it. Frankly, a lot of companies are doing it on a volunteer basis. Comcast probably most significantly with its Comcast Internet Essentials program.
There are good economic reasons to do it, but the big point that I would make is when we're putting government money into various companies or we're allowing them to exit bankruptcy in the case of Frontier where there's a lot of rural entities, they do have certain kinds of pricing power in the way at least that and Joanna and Bill are welcome to join in. If you price optimize for purposes of return on investment, you aren't pricing to 100%. You really are pricing to about 7080%, depends on the demographics of the area. And it doesn't terribly bother you that you're not getting the additional folks because in order to get them, you'd have to lower your price and then you would bring all of the revenues down. So what various companies have realized is if they can do an offering that's really just oriented for low income folks, There is some benefit to the companies, but there is a significant public benefit.
And indeed, think if you look at Comcast Internet Essentials, I would argue that in some ways it's even more successful than the FCC's lifeline program. They're kind of doing different things. One is really doing a mobile voice service. But I think it's really important for purposes of what's called the homework gap, but it's really much more than a homework gap. It's a digital learning gap.
So to do that, we often need to have much lower prices for that in home broadband. The same is going to be true for telehealth. One of the most interesting things that's come out of COVID is we have gone from approximately less than one percent of visits to medical professionals being over communications networks to now somewhere between twenty percent and thirty percent, and that number is going to keep going up. So if people don't have broadband in their homes with devices that are really capable of quality two way video, and mobile phones can do some things, but they can't do a lot of things. If you don't have that, you're going to be cut off from a lot of what medicine in the next five to ten years will be doing.
Another one I think is really important is when someone becomes unemployed, whether it's because of COVID or not, or whatever the reason is, if you want to train for a job, search for a job, apply for a job, you're doing it online. And indeed, there's research to suggest that people who are online get jobs faster because they've had that ability to train, search and apply much more readily. So from a system perspective, we want everyone to stay online. So those are the kinds of things that I would be looking to make public obligations. There are some costs to the companies, but I think those are reasonable requests to make sure that particularly in areas where there is very limited competition.
Speaker 1
Yes, Blair, I would agree. I just add, when I was talking about community involvement, I think the obligation should be a community involved plan to address access, right? Where are the gaps in access to address device shortages and also to address digital literacy issues? So more holistic plan, but also with a focus on funding sources, whether it's federal or state agreed to between improved co locally and the local community. Again, very much like what Mrs.
Beach said, the Tomlin ban. She was just saying, listen to our needs. Listen, we are stakeholders. Let's work collaboratively. Because I think often the communities don't know my experience.
They don't know even what the local like Internet essentials from Comcast, how to get into it. It's tricky sometimes, but when they learn, they're better at it. Same thing with some of the California programs, Lifeline and other high cost fund B ones. There needs to maybe be a simple playbook coming out of this plan that would help the community and the existing provider work deciding, A, what parts can be public, what parts can be private, and then how to make it happen. Thanks for the question.
Speaker 18
Thanks, Commissioner. Do we have I don't see other commissioners on. Do you have a see oh, at least Commissioner Schiroma. Are there questions from other commissioners? Commissioner Schrohma?
Speaker 23
Thank you. Thank you to the panel. Well, let me start with what advice would you give in terms of we have a company that's in Chapter 11 that purchased the sizable assets from Verizon a few years ago, have an extensive infrastructure network through some areas that are very rural and also urban. And we heard from representatives from Frontier that they are in dire financial straits in terms of how to balance the books. Now, in navigating bankruptcy and what we as commissioners need to do to look out for the customers and on the assigned commissioner now on Lifeline and how do we, as I think Matt said in the last panel, how do any advice on navigating that while also looking to lift customers who are on Lifeline?
Because there's been a specter of non reality that Lifeline customers get the last drag, the cheapest stuff, the lowest customer service, the least amount of bandwidth. That doesn't happen on the energy side of things. On the energy side of things, electricity is electricity, and there's a discount for the care customers on electricity. It's not a lesser grade electricity or a lower electron to the house and so forth. So kind of a big ticket question, but really from in terms of you all being the slots panel, really, any advice throw our way on that as we navigate the bankruptcy?
Speaker 18
I don't know if any panelist has an immediate response, so I'll defer to alphabetical order by first name. Blair, if you have anything.
Speaker 27
Well, thank you. Look, I'm going to say something which is not often said, but I believe to be true, which is we think of Lifeline as being the program by which we're going to connect everyone to broadband. That is not the history of Lifeline. That's not the reality of Lifeline. Lifeline was developed in the 1980s under the former president who was the former governor of California to make sure that everybody had a voice connection.
And that's really what the program has been. That is the way it is used today. Most people who have it have some small amount of data, but it is not when we talk about what we want people to be able to do on broadband that has public positive externalities like kids being able to learn, like people who can't travel about for whom traveling to visit a doctor is very arduous, being able to take advantage of telehealth, to be able to monitor their health, or again, unemployed people doing job training. Those are things which require for which Lifeline is not going to solve that problem. And if what you say to low income people is you have to make a choice between in home broadband, which allows you to do certain things, or mobile voice, it is my perception on the basis of lots of conversations with various people who are working with low income communities is most will choose a mobile voice with kind of limited data product.
They'll use their money that way. Totally understandable in terms of staying connected all the time. There are lots of safety and security reasons. If you're driving in a car, want to be able to do that, etcetera.
Speaker 23
you're not aware, but again, today's Wednesday. Tomorrow, we haven't voted yet, we're going to vote on a proposed decision that the judge and I issued, which includes a free and low cost broadband option through Lifeline and to be subsidized by our Lifeline budget. This is brand new. And again, I think you and others are referring to the fact that there have been broadband offerings, bundled offerings provided by companies in some of these rural areas. Our lifeline subsidy has been for the voice, but we are proposing for the first time to include, on a
Speaker 23
basis, companies can get a subsidy from us proposed, not voted out yet.
Speaker 23
are free options and a low cost option. And meanwhile, our governor issued an order on Broadband For All, and my colleague, Commissioner, who's my son, is heading up order instituting rulemaking on broadband for all. So there's a there's a a long journey ahead for sure. But you're right.
Speaker 23
Life long historically was so everyone just kept their phone. And, you know, when I was born, my parents did not have have a phone. We're a farm worker family. We were living in a converted barn, no indoor plumbing. And the landlord across the way had the phone.
And, you know, it's hard to even imagine days like those. But if I cut you off, but I think
Speaker 27
No, no, love that. That's great. Now is that going to be in lieu of does the individual have a choice between the mobile voice and the in home broadband or do they get both?
Speaker 18
One interjection if we can try and steer things as much as possible to the proceeding at hand, especially with the vote pending tomorrow.
Speaker 23
wanted to update you on what we're doing. But we're talking about the Frontier bankruptcy. Guess my original question was from a policy perspective, a policy really, I should say from a policy perspective, what principles we look at to have in place in this bankruptcy proceeding to ensure that we're on an upward trend, not a downward trend.
Speaker 18
And I'll go back to Blair and the other panelists, but Alison Ellis, I believe you had some input.
Speaker 8
Well, yes, I do feel it's important to say that a lot of the discussion today has centered around the need for broadband in rural areas and trying to bridge the digital divide. We agree that rural broadband is needed. We have been a big part of addressing that need in the state of California. California, the FCC, other states have enacted programs specifically designed to help broadband deployment in these rural areas. And these programs are needed, as I think everyone on these panels understand, because this type of investment is not economically feasible without them.
And broadband is not a regulated service, and when Frontier makes deployments, it's not guaranteed a return on its investment. For its part, Verizon, before we purchased it, didn't participate in these programs, but Frontier has, and even though it's not obligated to do so. As I said earlier, Frontier recognizes that there is a desire for broader availability in many communities in California, and
Speaker 8
to emphasize that at the time of the 2016 transaction, we voluntarily agreed to significant build out commitments. And as of today, we've connected more than 650,000 homes in California since we took over in 2016, just four years ago. In tribal areas as of 2020, Frontier has leveraged CAF II to deploy broadband and CASS programs to deploy broadband in these tribal communities and reach more than 15,000 households. So I just want to keep in sight that and bring us back to sort of the core question that's before the Commission, which is whether the Commission should approve the corporate restructuring of Frontier that will allow it to continue to provide regulated voice services in the state, continue to be a competitor and continue to be involved in building out broadband to some of the areas in California that are most in need. And the alternative is a status quo, and that status quo means that Frontier will remain a financially distressed company with unsustainable levels of debt, with significant interest obligations on an annual basis.
And that would potentially mean that it would be unable to offer competitive services going into the future, voice services, broadband services and further broadband deployment. So I just sort of wanted to make sure that I put that in perspective because, again, we agree that rural broadband and bridging the digital divide is a very important goal, and that's why we've been working toward it. And I am proud that in four years, we have expanded broadband to more than 650,000 California households, and I don't think that that should go without recognition.
Speaker 18
Thank you for that. Coming back to the panelists and questions. So I will paraphrase the question, then go back to Blair and see if Joanne or Bill, had any part in presence of paraphrasing in the context of the Frontier transfer, should some conditions or evaluation look at whether or not low income or certain customers receive the same service as customers in other parts of the service territory. So with that, did you want to follow-up on your remarks at all, Blair?
Speaker 27
Well, I would simply say, again, there's a relationship between all of these things and what the California PUC is thinking about in terms of in home broadband. I certainly congratulate you for understanding that the current lifeline program is from the federal level, didn't solve a lot of the problems that to create those kind of public goods that we really looked at communications networks to do. So I would argue that part of the conditions should include a low cost offering. I certainly appreciate the point that Allison is making about they are in a business in which they're trying to do certain things and sometimes the plans work and sometimes they don't. And the purpose of bankruptcy is to be able to come out with the financial resources that would enable them to build out and build higher quality services.
I don't think that a low cost offering jeopardizes that. And I think it helps deliver those kinds of, like I said, public positive externalities. That's the debatable point, I guess.
Speaker 8
I just did want to jump in on that because I Blair was not at the earlier panel, and so I just want to make sure it's clear to everyone that Frontier does have a low income offer. We actually have two. We have affordable broadband and Frontier Fundamentals. And in terms of the Frontier Fundamentals offering in particular, it's not a low speed second class type connection. We offer some of the higher speed tiers to those customers that qualify for Frontier Fundamental.
We have also taken affirmative steps to lower the access bar so they don't have to go through that laborious lifeline qualification process, which frankly I find difficult to make sure all of the questions are answered correctly and correct documentation is provided. On the Frontier fundamental front, where customers qualify Michael, for it, they can get
Speaker 3
sorry, Allison. I'm sorry, just to keep us on track, we did provide time for Frontier already. I really would prefer to hear from the panelists. I appreciate that Blair was not here, but this is not for Blair. This is for us.
And I just want to ask you to please, the panel, you have your opportunity. You actually were afforded more time than other parties. So we've already received some valid criticism for that. So if you could just I understand. Thank you.
Michael, please continue.
Speaker 18
So with that, Joanne or Bill, did you have any input on this question of making sure that all customers are well served? I believe you're muted.
Speaker 21
What I would share is just my experience watching deployment patterns nationally is that when it comes to upgrades, income levels are without question one of the factors that are part of what might sometimes be complex, sometimes a very simple formula that has to do with build out costs or upgrade costs on a per customer basis and potential revenues on a per customer basis. Income levels fit into that, there's no question, because different potential revenues will be a factor depending on the income level of the community. It is absolutely not the only factor. Deployment costs are going to be pretty significant also and other kinds of demographics, but that will be an issue. It is something that is a concern because there are patterns in some part of the country, and I'm speaking nationally in generalizations here and give you examples from other parts of the country if you'd like.
But there are definitely some parts of the country where in urban areas we see wealthy neighborhoods being upgraded to fiber and gigabit speeds and very low income areas are still at outrageously slow DSL speeds of a few megabits per second downstream and kilobits in the upstream direction, right? Even if it's five times that much, it's still not what any of us would consider sufficient to cold broadband We'd be happy within our homes. And those patterns frequently align with income. And it is, without question, very concerning and worthy of consideration. I don't know that it's a concern when it comes to things like customer service.
Customer service is something that is delivered on a centralized basis. And whether you are calling customer service from a low income neighborhood or a higher income neighborhood, you're likely to get the same customer service representatives and receive roughly the same treatment. Although if you're a big dollar customer, like an enterprise business class customer, enterprise or business class customer, you might see different kinds of treatment, but you're buying different products. So at the consumer level, though, it's not going to be that different. But when it comes to deployment, and as Blair pointed out, pricing and speed, these are critical factors.
They're economically entirely rational. This is not slamming any company. These are companies that are making very thoughtful, smart choices in the best interests of their shareholders. But from a policy standpoint, they are devastating because, as Blair also pointed out a few minutes ago, in a five gs world and a fiber upgrade world, we are going to a significantly greater digital divide than we have been in the past.
Speaker 1
Yes, would just add, Alison, it's great to hear about the Pioneer affordable broadband plans. We've been working with a lot of communities around the country, and they're finding that understanding the guts of those plans really helps them to communicate to their citizens how to apply. Sometimes it's tricky. Would just urge the commission and Frontier to keep pushing those plans. But if they sound like they're very equivalent to other customers in terms of speeds, which is wonderful.
But there's often a gap in knowledge about how to apply, and I would just urge you to keep it up.
Speaker 8
Well, thank you. And we do partner with the California Emerging Technologies Fund, and they have been really instrumental in helping to bring that information to low income consumers.
Speaker 18
So with that, I'd like to go to questions from the phone line. And then if other commissioners have joined, someone just please, excuse me, please bring that to my attention. But questions from the phone line operator, if we have any, and then yell after that, we will take any email questions.
Speaker 4
Right. So we are expecting to receive a call two callers. So as soon as they are ready, we will go back to them. But for now, let me check the email. We do not have any emails at this time that we have received questions, but we did we were informed that there will be two callers that will be calling in shortly.
Speaker 18
And with that, commissioner Guzman Ecebez or commissioner Shlomo, do you have any additional questions? I didn't let you ask many. Hearing none immediately, I'll ask one follow-up question that occurred to me during the panel discussion, and then we can come back to the Commission. And that was, Joanne, you had pointed out that there were some federal and state programs that did a particularly good job of community engagement. And not to put you on the spot, but can you just speak to any examples, either in terms of process of what worked or an actual program where that was particularly successful and might be duplicable or be able to be duplicated in California?
Speaker 21
to just struggle to keep it brief because this is one of my areas of greatest interest and passion, but let me give you a couple of really quick examples. I mentioned that I thought Maryland presents a best practice. The state of Maryland has a pretty robust, although relatively new grant program for rural broadband expansion. The grants are primarily going to benefit private entities who are building and operate primarily fiber assets with them, But the grants are not awarded unless the local government, in our case in Maryland, it's counties that are the really dominant government unit, particularly at the rural level on the rural side. But unless that county government is a clear partner strongly in support and deeply integrated into the funding, a private company will not get a grant.
And what this means is that the companies that are most engaged with the communities and are regarded by the communities as trusted partners and who are responsive to the needs of the communities are at a massive advantage in applying for the state grants. And companies located seven states away that have limited interest even if they might have nearby assets are simply disadvantaged by that unless they make a whole lot more effort to get to know the local community. That's an example of what I mean and the results have been very successful because of this and relatively non controversial. A federal example briefly would be USDA in these grant programs requires substantial showings of support from public entities. It makes grants to public entities but they're fewer than much fewer than the grants to private ISPs But the grants to those ISPs are the applications only become competitive if there is a showing of support from the local community in the form of broad based letters of support from businesses, from elected officials, government, and various other elements of civil society.
They see that as a sign of the viability and the stability of the applicant. The community support is seen as speaking to the sustainability and the likely success of the private entity and that's why it's a factor in making decisions about grants. I think those are takes a lot of work to get those grants out. It's a lot of analysis and time. It's not as simple as an auction process, but there are some real rewards associated with that level of work.
Speaker 18
Thank you. And I don't want to bother other panelists from responding, but I believe Commissioner Schiroma, did you have a further question?
Speaker 23
Yes. For the thought panel, when we navigated the PG and E bankruptcy, we and the Governor, but we substantially focused on the makeup of the board of directors and the governing board and looking for diversity. Now there's a new law, diversity. But beyond that, diversity diversity of experience viewpoints and also we ended up with 50% of the border direct needs the governing board, I should say, meets to live in California. And so any any viewpoint going to that model of assessment in looking at a new frontier coming out of the top level of the policymakers.
If you don't have experience with that, that's okay.
Speaker 1
I mean, I think, Commissioner, I would say that to the extent you can ask require board members
Speaker 9
to have used that are consistent with what we've been talking today of a community up approach to
Speaker 1
planning and applying for some of these grant programs to meet the needs of
Speaker 9
the local community. And again, focused on the improved, I think that'd be great. My experience is having a diverse boards and a lot of the companies I've been affiliated with is is good for the company and good for
Speaker 18
And, Blair, Joanne, anything to add? And if not, I will go back to the phone line to see if we have callers now.
Speaker 27
Well, would just say there have been various proposals by folks that have different kinds of representations on boards of directors. I don't want to weigh in on that, but I would note that other countries do make that requirement. In this particular case, if there is to be a public, what you might think of as a public member, it would of course have to represent a constituency far larger than California. And I think that's tricky. I think there's some merit to thinking about it.
But how you get that kind of public representative when there are multiple states involved in multiple communities I think is tricky. But that's why I go to I think that the state is entitled to certain kinds of information on a more timely basis than one might have thought of in the past.
Speaker 18
Thanks, panelists. And Yelas, could we check to see if there's are there any questions on the phone lines?
Speaker 18
Okay. Thanks, operator. So with that, Commissioner Guzman of SEGAS, any follow-up questions?
Speaker 3
Sure. Thank you. And again, I think there's a couple of thoughts here that are merging together. One with your point, Blair, on the information, more timely information we heard in our earlier panel, everything from requests of where potential fiber is in their community that could be potentially accessed. Then Joanne, you mentioned an obligation to have open access to that, to have information on the points of presence.
Just thinking about what could that look like? Could there be some sort of quarterly update for communities that are still looking to get broadband to have access to how they could best partner with Frontier. And this is kind of a very tangible idea that you guys have presented in terms of having that access. Are there other examples like that? Key infrastructure or even, you know, there's a lot that you guys have said that's kind of out of our hands, certainly any other federal funding, but also there's a lot of great ideas for us to consider in other proceedings, lifeline or our broadband programs or public purpose programs.
And just in relation to kind of actualizing, putting the pieces together with you know, this application before us. Is it and by the way, we've done a similar thing, as Commissioner Schrohma mentioned, on the electricity side where we have a new portal for local governments to be able to access where, you know, this key distribution infrastructure is, key points of communication. There's now a local government interface that includes a, a live portal where people can update everything where substations being upgraded, they're putting up backup generation. So that's very fairly new on the electricity side. Is there something similar like that where you could just imagine the level of collaboration that could be the level of progress that could be made simply by a deeper access, as you say, generally to the data.
But could it what could it look like? Could it look like a local government portal, as we've done on the electricity side? Or is it this planning process that they're obviously going to go through to define their investable areas? Any thoughts on that?
Speaker 18
I defer to the panelists if anyone wants to take that first, maybe Joanne, and then Blair, if you wanted to amplify or clarify any of your earlier comments about reporting.
Speaker 21
I guess I would say that more information is always a plus. And there's so much hunger and concern and even desperation at the local level about this. And communities are going to great lengths and in many cases spending a lot of money to develop information that is at the fingertips of companies. And it's just to know where do we really stand and what are our options and what prospects do we have. And then many of them find and this is true in very rural areas throughout the country.
They find, well, the prospects are actually very slim and they don't have a lot of tools at their disposal, although I am optimistic that new, more expansive federal funding will help to change that as will public private collaboration merging with that. So new information is always good. More information is good. Availability information is good. And as I said, much of this information is at the fingertips of many companies.
Companies know exactly where they can provide services because they take orders all the time, and their websites can tell us immediately when we plug in an address whether they can serve us or not. There's some exceptions to that, but they're relatively infrequent certainly when it comes to fixed wireline networks. But at the same time, I want to be really honest that information is good, it's helpful, it supports a planning process, but it's not really a flip that we can switch or a lever for unlocking new opportunity that takes capital access to poll assets,
Speaker 21
And the communities having more information doesn't necessarily put them in a position to be able to enable or support Frontier any more than they're already doing. I think just based on my experience in other parts of the country, it's probably safe to say that many of these communities have been meeting with every single company they can find, including the incumbent, and saying, What can we do to help? Will you upgrade? We're desperate. This is so important.
What's our role? How do we help you? It's not like they haven't tried that. So I would say all of those things are going to be really useful. They move us in the right direction, but the movement is relatively modest relative to the distance we have to travel.
Speaker 27
Basically just I agree with Jo Anne and don't have anything to add other than something that's to follow-up on her point about future federal funding, would just note that the House Democrats have already passed a $100,000,000,000 broadband package as part of a broader infrastructure package. And even Republicans like Jeb Bush the other day came out in favor of $100,000,000,000 broadband package. So I think there's the possibility of that. That's not necessarily related to the bankruptcy, but I do think that it's good for the California PUC to be thinking about how could a package like that help address the state's broadband needs.
Speaker 18
And a quick follow-up just while we're on this topic. I understood your earlier comments about reporting partly to be about reporting financial and sort of business operations information. And so and I understood you'd be saying potentially even more frequently than quarterly to sort of see if there's smoke at some point?
Speaker 27
Right. Well, it's really look, the company is planning on doing a variety of things. Companies are constantly reevaluating their plans to the extent that they are not hitting the benchmarks that will enable them to meet the commitments based in terms of the California PUC coming out of bankruptcy. The earlier you know, the better the options there are for dealing with it. If it's if you don't find out until the day that you were supposed to have the network built that the network is at least two years delayed, obviously your options are worse.
So getting earlier information is part of the key to that, I think.
Speaker 23
Yes. I just wanted to thank everyone. I need to exit to go to another meeting. But thank you to all of the panelists. Very interesting conversation.
Thank you, Commissioner Guzmana Sevast, for hosting this workshop and all best wishes for the participation part of this evening and hopefully, you know, good number of folks do call in to take advantage of providing public comments. Thank you very much.
Speaker 18
Thank you, Commissioner Schroma. And with that, Yella, could you go to the email question and operator if we could check the phone queue after that.
Speaker 4
Absolutely. Thank you, Michael. So we have a common question from farmer, Scott Farmer from Sonoma Coast MAC. There is every indication from what is said that Frontier will not serve rural areas differently, not well. What will change?
That is the question.
Speaker 18
Posing that to the panelists. If the you know, in paraphrasing and interpreting a little bit with the question, what might be conditions, and we've talked about some, but to ensure that service is upgraded and it's not the same as it was from the Verizon to Frontier transfer or today from Frontier pre and post bankruptcy.
Speaker 1
I would just reiterate what I think we've said a couple of times is that a commitment to work with the community to develop a plan to bring broadband to the spots of the community that don't have it, and a comprehensive plan that tells the community how it's going to do that in partnership with Frontier or ImproveCo would be essential. And I think that could make a big difference.
Speaker 21
And I would just add that absent obligations, there's no reason to think anything would change. And that's not because I am privy to any internal discussions or strategy at Frontier, but the economics of broadband in rural areas are going to be the same after this proceeding as they were before this proceeding. And any company has only a limited number of dollars to invest. Even when that's a lot of dollars, it's still finite. And it's going to go to the places where the return is highest.
And certain rural areas and particularly certain low income rural areas are not going to be where return is highest. So those dollars will not go there and that doesn't change unless there's some kind of a legal obligation to go there. That's just the basic laws of economics and how infrastructure deployment that is financed through private capital works. Again, totally rational, not a slam at any company. This is how our system is set up.
But I don't think we should assume that the problem solves itself.
Speaker 27
It really depends on the enforcement mechanisms. I mean, it could be that if there are agreements made and there should be some enforcement mechanism. Fines are problematic in a sense because you're actually taking money away from what you want, which is more CapEx. But you could, for example, say that dividend payments or other kinds of payments to various financial stakeholders couldn't be made until the build out is complete or what I mean, are complicated things. But there has to be some kind of priority and incentives to actually do what they say they're going to do.
Speaker 18
Thank you. And I understand there is operator, there is a caller with a question on the line.
Speaker 4
Hi. Yes. We will. I will just go ahead and read the question from Larry Ortega. It's pretty long, so give me a second here.
He was trying to call in. But here's his questions. Number one, what mechanisms will the CPUC use to meet necessary enforcement requisites post bankruptcy approval by CPUC? Question number two, was not overleveraging at the time Frontier took over the Verizon asset at issue. Why was this approved if such high debt existed and continues to exist for Frontier?
Three, cost is primary concern for access. There are more people in the inner city without Internet access than in rural areas. There are tens of thousands of children without high speed Internet in the home in the inner city to every one student in rural areas. Wholly disagree with Blair Levin on Lifeline? The Lifeline is a product and program that requires necessary training and promotion to let folks know they qualify and how to apply.
These are steps that are needed to be transmitted
Speaker 26
to the communities to which they are intended to serve, and language promotion is necessary. Local municipalities should be given right of first refusal to take over the frontier assets in ground currently within a region within a region. Number five, CPUC should require Frontier to develop a map as to where the fiber is in the ground. Need a map of Frontier's current assets, fiber in the ground by region, municipality? This is from Larry Ortega, Community Union Incorporated.
Speaker 18
Thanks, Yella. There was a lot there. Being cognizant of the time, I'll paraphrase briefly and then go to the panelists. And I know we've talked about some of these, but I think in particular, if we there are further thoughts about mechanisms, more or less enforcement. I know Blair talked about it earlier, Anne just touched on how fines could be limited, and particularly the question about leverage overleveraging and the high debt load, and if other states or California might consider looking that in that level of detail of this transaction, or whether that's proven problematic in other states or instances.
Enforcement mechanisms and whether to look at debt to equity ratios and that detail finances. So with that, maybe Bill, if I could start with you.
Speaker 1
I'm not sure I have anything else to add from what we said already. I mean, it's hard to disagree with having an appropriate debt load, that's Right. Kind of what
Speaker 18
With that, let me go to Blair Levin as the maybe the most experienced Yeah. With these
Speaker 27
The in a lot of ways, the purpose of the bankruptcy proceeding is for an expert, the bankruptcy judge, to determine what is an appropriate debt load. But having said that, there are lots of uncertainties. You can have an appropriate debt load in January 2020 and then discover that because of changes in the economy in April that you were way over levered. There are certainly a lot of situations where people are under leveled. So I think that's a difficult thing.
I'm not sure that California PUC has that's where its kind of real skill set and expertise would be. But it's obviously a critical question for the bankruptcy court. But it's also true that the new financial stakeholders are unlikely to invest in any kind of financial instrument unless they think that the ratio is approximately right. Of course, they're looking for return, not the creation of public positive benefits. And then finally, to the extent that the person disagreed with me, I'm not sure that I understood the nature of the disagreement.
I certainly agree that Lifeline is an important program, and I think it needs to be reformed in a variety of ways. I was just making the observation, which I think the person agrees with, which is that we want everyone to have access to voice, but we also want everyone to have access to in home broadband, particularly for, as the person mentioned, such things as being able to learn and do one's homework. And my only point was Lifeline as exists at the federal level and in most places at the state level is not designed to do both. It's designed to do one or the other and mostly is designed to do voice.
Speaker 18
Thanks for that. I welcome any I'll thank the panelists and welcome any closing thoughts if you have them, but want to be cognizant of the time and give everyone a chance to take a moment before the next discussion. So thanks to you all. Thanks, Commissioners, for the participation. But, Joanne or Will excuse me, Bill, do you have any closing thoughts?
Speaker 26
I hope okay, my robotic voice is good, but we will be taking a break and we will continue at 03:20. We'll see you shortly.
Speaker 4
We definitely had a good conversation, and we are now going to move, to hear input from the following parties. We are going to hear from the Utility Reform Network through with Christine Mayux, and we will then hear from the Public Advocates Office through Christina Donnelly, and then we will have Communications Workers of America, Rachel Koss. Christine, would you like to start, please?
Speaker 22
Yes, thank you. Good afternoon. My name is Christine Mayu. I'm a telecommunications staff attorney and managing director of the San Diego office at the Utility Reform Network. We're a statewide consumer advocacy organization representing repairs before the Public Utilities Commission on Electric, Gas and Telecommunications proceedings.
Thank you for the opportunity to speak today, and thank you to Commission staff for putting the workshop together. I have just a few remarks regarding TURN's approach and goals in this docket, and then I'll turn it over to the other interveners to do the same. The importance of this docket cannot be overstated. And to meet the Commission's statutory duty, the review of this application cannot be a narrow focus, as suggested by Frontier this morning. The docket is not but it's important to note that this docket is not about blocking Frontier's emergence from bankruptcy.
They're already in bankruptcy, and it is in nobody's best interest that they do not emerge from bankruptcy. But we must make sure that the decisions being made at that level to emerge from bankruptcy don't just support shareholders and creditors, but support consumers and local stakeholders as we've heard from today. Today, the Frontier customers that we heard from were directly impacted by the company's day to day business decisions that are generally implemented by those people on the ground, the technicians in their trucks, the customer service agents, those directly reaching out to these customers. But as we heard today, those local reps do not appear to be empowered to make important decisions. Interestingly, despite Frontier's promises to bolster and embolden and enlarge the local presence of those reps during the Frontier Verizon sale.
We have to remember that the decisions that those folks are implementing are actually made by company representatives at all levels of the company, and in this docket that distinction is very important because Frontier is asking the Commission to find whether the restructuring at the highest levels of the company is in the public interest on the ground here in California. So while the $1,000,000,000 shuffling might be happening at the top in a manner that will ensure the company can emerge from bankruptcy, we
Speaker 22
and ensure that their shareholders and creditors are properly compensated, we cannot lose sight of how those decisions will impact folks here on the ground like the people we heard from today. Churn has focused its efforts in this docket on understanding bankruptcy court process and understanding the negotiations and promises being made between the company and its creditors and the shareholders well beyond just making sure that there's a confirmation plan. As we're learning, a lot more is going to be happening now after the confirmation plan has been approved. And that includes deciding on investment priorities, deciding on dividend policies, understanding who these new owners are and what their motivations will be, and understanding how the the new frontier, the restructured frontier, plans to use public subsidy money. We're making sure that we understand how those decisions might impact California customers, including the most vulnerable customers.
The bankruptcy court process itself is not really looking out for the benefits of the on the ground California consumers. As we just heard actually at the end of the last discussion, the bankruptcy court process is making sure that the creditors are going to be taken care of and that the parent company of Frontier is financially viable going forward, at least for a certain amount of time. But that's not enough for this commission to make its decision and satisfy its statutory burden. There's too much uncertainty at the bankruptcy court level to rest assured that these new investment bankers, who are now going to be the owners of Frontier, will have consumers' interests at heart and provide strong low income programs, robust broadband even in the rural parts of the territory, affordable voice and broadband services, and provide assurances that California ratepayers, through price increases, don't end up paying for Frontier's debt. All of the conversation that we had this morning, we can't trust the bankruptcy court to make those decisions for us.
It's important to note that TURN also never accepts the trickle down theory. The trickle down theory that suggests what's good for the parent company will always be good for the operating companies, and therefore, always good for those on the ground. The territory here in California is too diverse, the needs of the customers are too varied, and service quality and broadband buildout issues too intense right now to suggest that just looking at what's happening at the bankruptcy court is sufficient and that the decisions made there should just be in the public interest here in California. Therefore, for our testimony in this case for TURN, we've proposed several conditions that we believe the Commission must adopt to ensure that the transaction is in the public interest, along with some of the other intervenor conditions. Our conditions mostly address the fact that the Frontier's application in this docket, its testimony, and what's happening at the bankruptcy court level does not provide enough information to this Commission to really determine what's in the public interest.
And again, I didn't change my remarks to accommodate what we just talked about a minute ago. Indeed, we need more information. And we need more real time information about the investment decisions that are being made today and will be made over the next three or four months, and ongoing even after this docket is closed. So a lot of our conditions focus on that to make sure that we all have the information we need to monitor and influence and perhaps require obligations of Frontier to make those decisions in our best interest. I will also say TURN strongly supports what's been talked about today, which is involving local communities, local organizations, stakeholders in some of these investment, InvestCo, ImproveCo kinds of decisions that TURN and our expert witness has been looking at very closely.
With that, you will hear from other interveners now at this point that have crunched a lot of data, have reviewed the record as well to recommend other concrete proposals that we believe are necessary as well to make sure that this transaction is in the public interest for California consumers. So I will now give it over to Christina Donnelly, who is an expert witness in this packet and senior policy analyst for the Public Advocates Office and the Communications and Water Policy Branch. Christina?
Speaker 28
Thank you for having me today. As Christine May said, my name is Christina Donnelly and I'm an analyst with the Public Advocates Office. The other members of my team that are working on this proceeding are in attendance as well. That includes Cameron Reed, Bishi Yee, and Tony Tully. So the Public Advocate's Office, for anybody who's not aware, we're an independent group within the CPUC, and our statutory mandate is to represent and advocate on behalf of residential and small business customers in California to ensure safe, reliable and affordable service.
Our team has reviewed Frontier's application and we submitted our recommendations to the Commission in the form of testimony on September 30. Our detailed review includes an examination of the impacts on Frontier's investments in infrastructure, service quality and reliability, declining customer satisfaction and broadband deployment commitments, particularly in tribal and rural communities. In its application, Frontier promises that the Commission's approval for corporate restructuring will produce significant benefits for California customers. Frontier has claimed that debt and interest savings resulting from the restructuring will enhance company's corporate and operational stability and alleges that the savings will enable the company's California operations to improve and enhance the services these subsidiaries provide. But Californians cannot take Frontier's promises at face value.
On their own, releasing debt and lowering interest payments are not necessarily in the public interest of Californians unless specific concrete benefits will accrue to customers. Before the Commission can approve the proposed transaction, it must find that the transaction will be in the public interest. This is a requirement under PU Code Section eight fifty four, which the scoping memo in this proceeding has already ruled applies in assessing whether Frontier's application is in the public interest. Therefore, the Commission should impose on Frontier specific conditions that are necessary to ensure the proposed restructuring is in the public interest. Specifically, the Commission should require Frontier to make specific measurable commitments to increase network investments, improve service quality and reliability and provide faster Internet speeds, particularly tribal communities, low income customers, and customers in rural areas.
Our testimony includes a number of recommendations, and I'm going to briefly summarize a few of them here, but our recommendations include but are not limited to the following. First, we think Frontier should implement California specific plans to expand fiber deployment to homes and businesses, particularly those located in unserved and underserved areas. Frontier must commit to specific monetary investments to improve the company's California network and poor service quality. Frontier should reinvest money freed up in the restructuring into its network to improve California service quality. Frontier should increase the number of employees that provide customer service to Californians.
For a period of no less than three years, Frontier should maintain its current rates for its low income broadband health plans while ensuring internet speeds and data per month are at or greater than the Federal Communications Commission's Lifeline program. Number six, Frontier must commit to providing minimum speeds of 25.3 megabits per second downstream upstream for all new broadband deployment, particularly for broadband deployment in tribal communities, which have received disproportionately slower service than other communities. Frontier must conduct a customer satisfaction survey to measure customer awareness of digital voice service backup power requirements and to measure the level of customer satisfaction within Frontier's service territory. And again, this is just a summary of our recommendations and our full list is included in our testimony. Frontier's poor service quality and customer service record is well known to the Commission and is imperative for Frontier to improve its California network now in light of the recent COVID-nineteen pandemic that has kept us all at home for months on end, as well as the increasing severity of climate change related disasters.
Californians need and deserve safe, reliable, and affordable telephone and internet service, and the state has waited far too long for Frontier to deliver. Thank you to the panellists for participating in today's workshop, and we look forward to hearing any additional comments during the upcoming public participation hearing and the public comment period following our comments. So thank you.
Speaker 16
Yes, good afternoon everybody. I'm still trying to access the WebEx. I apologize, technical difficulties. It's not allowing my password. Oh wait I think it is now.
Okay here we go. You might see my face in a minute.
Speaker 16
apologies. Good afternoon, everybody. Thank you so much, Commissioner Grzemaneseves, for holding this workshop. Thank you, staff, very much. My name is Rachel Koss.
I'm here on behalf of Communications Workers of America, District nine. District 9 represents nearly 20,000 employees of communication services companies in California, including Frontier employees and these include the technicians who do the repair and maintenance work on telecommunication facilities. They have firsthand knowledge of the condition of Frontier's system, what work is getting done, what work is necessary but not getting done. This morning we heard from several government and community representatives that Frontier is not doing its job. Poor service quality, severe lack of communication, failing to invest in the system, exacerbating the digital divide.
Not surprisingly, these accounts are in stark contrast to Frontier's presentation at this workshop and from Frontier's formal claims filed in this proceeding. This is alarming and this is telling and therefore commitments by Frontier frankly ring hollow and the Commission should be very concerned about the impacts of Frontier's proposed restructuring on customers, on safety on employees. Frontier has not adequately maintained its physical copper plant since purchasing Verizon assets in 2016. Verizon has in large part failed to repair or replace outdated or damaged infrastructure. Customers suffer frequent outages.
Others have poor and outdated service. And still others, like we heard this morning, can't get service at all. Frankly, the system is just not safe for workers or the public. Notably, since acquiring Verizon 20 Verizon assets in 2016, despite the much needed work to improve the system, the size of Frontier's workforce has gone down. Technician positions alone have gone down by more than 400.
That means 400 less people to do the necessary work, to do the repairs and upgrades, to maintain a safe and reliable telecommunications system. So the accounts by government and community representatives this morning are no surprise to District 9. Without the people to do the work, the work does not get done. Experienced technicians who take pride in their work are leaving the company. They are frustrated by Frontier's lack of investment in its system.
They're frustrated by poor management and they are frustrated by customer dissatisfaction. That means Frontier is losing technicians who are the most familiar with the system. This does not bode well for the system moving forward, which is already in dire condition. And this does not bode well for the restructuring resulting in improved service quality. Also, as we repeatedly heard this morning, Frontier's fiber installation is far behind, particularly in older neighborhoods and rural areas with deteriorating copper infrastructure.
There is no assurance, Frontier has given no assurance that it can do better and that it will do better on this front following the restructure. Finally, District nine shares Commissioner Guzman Oseves' concerns about the proposed virtual separation. Frontier describes this as a plan to separate state operations between those that will receive cyber deployment and those that will receive unspecified upgrades and improvements. Frontier's application in this pursuit in this proceeding lacks the details that that the Commission needs, that the public needs on virtual separation. And at this point, it is impossible to determine how the virtual separation will impact service for Californians.
This all boils down to well founded concerns that Frontier's restructuring will negatively impact customers and will negatively impact employees. And District nine asks the Commission to ensure that the proposed restructuring improves service quality and is fair to utility employees by requiring Frontier to develop an enforceable service improvement plan for every California service region and by requiring Frontier to maintain an adequately sized workforce to fix the network to address the widespread service quality issues. Finally, Commission, the parties and the public must have sufficient details on the virtual separation to determine what the impact will be on California customers. We look forward to participating further in this proceeding and thank you again for holding this workshop and allowing District nine to participate.
Speaker 4
Thank you very much for those comments. We will now turn this segment to the public comments with the ALJ. We've heard all the parties at this time. We will now move to a public comment segment of this workshop event. At this time, I would like to turn this over to ALJ Worsinski to lead us through the remaining part of this event.
ALJ, are you available?
Speaker 11
I just I just wanted to ask a question that I posed on the, the chat function. We would just like to understand whether what's just been said was was transcribed. And if so, we'd like to be able to respond on the record. If not, then I I understand we're moving on to something that would be transcribed where we wouldn't be commenting. But could someone clarify this for us if if if if you could?
Speaker 4
Yes. Thank you, Patrick. The the segment earlier was not transcribed. The transcription will begin when the ALJ begins his portion.
Speaker 11
Alright. And and is are we to understand that the parties are not to be commenting during this this segment?
Speaker 4
Yes. We the ALJ will clarify the the steps for the next segment. Thank you.
Speaker 27
Very good. We are on the record. The California Public Utilities Commission will come to order. It is now 03:42 p. M.
On 10/07/2020. Good afternoon. This is the time and place for the public to comment at the end of the public workshop in application twenty-five thousand and ten, the application of Frontier Communications Corporation and its affiliates for approval of a corporate restructuring. My name is Peter Worsinski, and I am the assigned administrative law judge for this proceeding. The assigned commissioner for this proceeding is Martha Guzman Aceves.
And commissioner, if you would like to make some remarks at this point, please go ahead and do so.
Speaker 3
Thank you, Judge Ruzinski, and thank you to the public who has held on so long. Looking forward to your comments. I know that there has been a couple of folks who have requested to be seen on the WebEx. Is that something we can accommodate? I certainly would be supportive of that, but I leave that to to you and the folks, Joe and Robert.
Thank you.
Speaker 27
Very good. I have no problem with that if it's technically feasible, so I'll I'll I will leave it to Robert and Joseph as well. Thank you, commissioner. I will now provide instructions, for those of you on the phone who want to speak. If you have not already done so, please press star one on your phone now, and the operator will add you to the line of speakers.
Those members of the public who are watching on the Internet and who intend to speak in this hearing, you must first call the following telephone number, (800) 857-1917, and then press access code 700000218384. After you press the access code, you must press star one on your phone to be placed in line. After pressing star one, you will be prompted for your name and where you are calling from. A court reporter will be transcribing your comments, and a transcript of those comments will be posted on the docket card of this proceeding on the commission's website. When you speak, please speak slowly and clearly so that the court reporter is able to transcribe everything you say.
Please speak directly into your phone or headset. Please do not use a speakerphone. When the operator tells you that you can begin speaking, please first state and spell your name, and then state where you are calling from. At any time before we end this time for comments, you could get in line to speak by pressing star 1. A chime will sound after three minutes to indicate that the speaker's time is over.
And as I said, we will this segment is dedicated to comments from the public. We are now ready to begin with transcribed public comments. Operator, if you could please announce the first speaker.
Speaker 25
Thank you. The public comment line is now open. Our first speaker will be Steven Walters. Please go ahead.
Speaker 30
Good afternoon. It's Susan Walters. And my name is Susan, s u s a n, Walter, w a l t e r s. I'm the senior vice president of the California Emerging Technology Fund, a nonprofit organization whose mission is to close the digital divide in California. CETF participated in the merger proceeding of Frontier and Verizon and executed a settlement agreement with Frontier to bring significant broadband benefits to customers.
This includes broadband infrastructure to
Speaker 1
327,000 underserved households and businesses and new broadband access for 107,000 unserved households
Speaker 30
to as well as affordable broadband offers distribution of 50,000 tablets to low income households as well as an increase of 200,000 low income households online at home. So in light of this positive settlement that is the type that I think Blair Levin and others mentioned earlier that the Commission approved, these public benefits are important to continue and CETF is concerned about the financial viability of Frontier. At this time, during a health emergency, it's critical for all customers or consumers really to have broadband. The CETF supports the need for Frontier to move forward in a healthy financial state but also for the to continue the commitment for voice and broadband service to all customers. Many of the earlier comments reflect policy leadership that's needed in California in clarity about how to reach broadband goals for everyone.
For example, many people commented that Frontier opposed new interest in innovative solutions but all companies or almost all companies have opposed those or challenged CAS applications in their service areas because AB sixteen sixty five allows the Commission will have a chance in new legislation to oppose those kinds of measures going forward.
Speaker 27
All right. Very good. Thank you, Ms. Walters, for your comments. Operator, if you could please announce the next speaker.
Speaker 31
Yes. This is Ronald Rawicker. Last name spelling is r a u h e c k e r from Novato, California. We need to have the ethics and scavengerry that frontier pools every time they make a billing at, they try to add extra items on there, like road repair and cause you didn't make, and this happens at every bill, and we need to stop it. When you try to find out who their agent of process is, they play dumbfounded.
I don't know how they're able to get by without having to post that with the state, but I've tried several times to be able to take them to small claims court, and I've been unable to reach the address of processing agent. We need to have that furnished to every recipient of Frontier customers. We're totally upset. Frontier should at least pay a 10,010 million dollar fund put aside to make sure that they make these promises come true. We've had so many outages and stuff like that that it it's unrealistic anymore.
Every excuse you get, it it it doesn't come true. They just just lie like hell. There needed to be a a set precedence, quote, out so something like this does not ever happen again. I'm 80 years old, and I've never dealt with a company like this. Their ethics is unbelievable.
Thank you for hearing me.
Speaker 27
Thank you, mister Rodaker, for your comments. Operator, if you could please announce the next speaker, please.
Speaker 25
Your Honor, there are no more speakers on the public comment telephone line.
Speaker 27
Okay. Thank you, operator. We would like to give everyone an opportunity to speak in this public comment section, and there may be others who are attempting now to call in. And so what I'm going to do is I will check back with you, operator, several times over the next few minutes to see whether there are any other commenters or anyone else who intends to call in. Please do so now.
Press the code number after dialing the number (800) 857-1917. Press the passcode number 700000218384. And then press 1, and you'll be placed in line. So I'll wait a minute and see if there are any other callers. Operator, if you do get some callers, please go ahead and announce them.
Speaker 32
is Margaret Graham and I live in Timber Cove which is Sonoma County out on the coast. We're a small rural community but we have a huge amount of tourists out to our wonderful coast out here. And because we're a small residential community, Frontier does not provide adequate broadband service out here. I support what Supervisor Stump and Gossip both said about living in a rural neighborhood. But I also want to raise the question about what costs there might be incurred if we go ahead with the support of Frontier financially.
And even though they have already said they shall evaluate areas where it makes financial sense. When they don't actually come through with supporting us in providing adequate broadband services out here, what's the cost in terms of economic losses, public benefits to schools and emergency response, loss of trust in the CPUC, and delays in startups of alternative local agencies that may well have been able to provide this service to us. And these delays might be over a couple of years and these are costs to our community that are in addition to the bailout costs that aren't necessarily being
Speaker 32
I do want to say, I sit here in my office here where I work from home. I have a 14 year old going to high school via Zoom. We can't do more than two people on Zoom at any one time. So things like medical appointments have to be structured around. And also when I look out my window, I see Highway 1 which has fiber available to it.
It is installed in there and yet we cannot get access to it because of Frontier. Thank you very much for the opportunity to speak.
Speaker 27
Thank you, Ms. Graham. Operator, do you have any other speakers on the line?
Speaker 27
All right. I will wait a minute, and I will check back with you, operator, and see if anyone else has called in. Again, if someone calls in, please go ahead and announce them. Operator, is there anyone else that's called in?
Speaker 27
Very good. We are going to wait. I will wait another minute and check back with you, operator. I want to give, anyone who wishes the commonest a full opportunity to do so.
Speaker 3
Ted Druzinski, know there was one particular caller from Calusa County. I don't know if communications division has been able to get her through. Believe her name is, Alina Arbery.
Speaker 27
Okay. If anyone can with Communication Division can give us an update on that potential caller, that'd be great.
Speaker 4
This is Ciela. I'm checking if we can get Alina's phone number, then maybe we can just have the operator call her back.
Speaker 29
Thank you. I just really want to reiterate what the first caller that I heard said about the lack of service with Frontier in particularly the small communities who don't have any other choice. We're in a situation where we're basically stuck with Frontier. They don't appear to care very much truthfully. If we have good internet service and consistent internet service, I myself experiencing several several issues for several months with Frontier's pricing.
I had a contract or have a contract with them and they're trying to charge me a lot more than my contract price. They seem to think that they can just do this and people have to accept it. They really are not a very good company to have to deal with. The majority of us who had Verizon in the past before this merger went through are really upset truthfully that this merger did occur. We expected some problem because we knew that Verizon's wiring, was not basically up to code.
It was old. We expected that Frontier would take the initiative and fix these issues, evidently they're not willing to do. So that's really basically all I have to say. Thank you very much for taking my call.
Speaker 27
Very good. Thank you, Ms. Ansley, for taking the time to call in and comment. Operator, anyone else that has called in?
Speaker 25
Yes, sir. Next we have Michael Pierce. Your line is now open. Please proceed.
Speaker 33
Hello, Judge Kucinski. My name is Michael Pierce, and I'm on the staff of the PUC's Communications Division. And I just want to raise a point of information. My understanding is that there was supposed to be time for the public forum at 05:30 and if other people believe that's the case, they may be calling in then, so I might suggest that there be accommodations made that you can have the lines open and you can be listening at 05:30 to 05:45 in case other people want to call then.
Speaker 27
Very good. And I'll let you continue if you want to, Mr. Pearce, but we are going to have a separate public participation hearing session that will start at 05:30. So I hope that addresses your concern. Do you have any other comment you'd like to make, Mr.
Pierce? Nope. That's it. Thank you. Very good.
Thank you for your comment. Operator, anyone else that's called in? Hello? Yes. Hello, operator.
Is there anyone else who's Yes, called
Speaker 33
Thank you. My name is Scott Farmer. I'm the Chair of the Sonoma County Coast Municipal Advisory Council. And just briefly, the Sonoma County Coast area served by Frontier experiences issues presented by this panel through the day. Frontier has marketed services to our excuse me.
Let me start over. Our experience with Frontier on the Sonoma Coast is much like other tribal and rural communities have stated. Being rural, too far, too few. I don't expect to see any improvement in service standards soon. The frustration is that Frontier claims to serve areas which they do so marginally or not at all.
These claims are erroneous. Local efforts to break out are challenged. We understand the economics. However, our communities are fading. Real broadband is critical to our vitality.
Please give us a viable path forward. Thank you.
Speaker 27
Thank you, Mr. Farmer, for your comment. Operator, is anyone else that's called in? On the Sonoma Coast, it's
Speaker 33
much like other tribal and rural communities have stated. Being rural, too far, is huge. I don't expect
Speaker 27
Okay. Alright. We will wait a minute. I will check back with the operator to see if anyone else called in, and we'll also hopefully follow-up with, I believe it was Ms. Avery who had indicated that she wanted to call in.
We'll see if we can connect with her. Operator, do we have any other speakers on the line?
Speaker 27
All right. We will wait, and I will check back with you, operator. Operator, is there anyone else on the line to speak?
Speaker 27
All right. We will continue to wait. While we are doing that, CD Division, I don't know if any one of you have had an opportunity to see if we can connect with miss Avery. But please let me know if there's anything new regarding contact her to call in for this segment of the, the workshop.
Speaker 4
Hi, ALJ. We tried to reach out to the caller, but there was no response with our from our call.
Speaker 27
Okay. I do want to give everyone the opportunity to call in, and I will I will wait again, and we will check I'll check back one more time to see whether anyone has called in. If any of the the staff people are aware of any possible connections that I should be aware of to allow them to comment in this segment, please please let me know.
Speaker 34
Hi there. My name is Alina Anberg, and I'm a teacher in the rural Northern California County of Paloosa. I was working on the Internet rural divide since March when, of course, as a teacher, we went home with students that needed the connectivity. But along the way, I was I talked to each resident. I went door knocking, actually, door to door to each of our 1,300 student homes and beyond to see what was needed and what they had, and did they have a cell phone, or could they use a hotspot.
And I ordered some SIM cards to pass out from smartphones I collected from the community to then redistribute to people who with SIM cards to use as connections to their Chromebooks. But along the way, I was waiting for the SIM cards and realized that actually coming more north toward the school district, I realized people did have service, subscribed to service, but did not have service. And that was Frontier Service who has been a monopoly provider here for over thirty years. And so I started doing research then into that as to what is going on with that and also of course looking for other solutions. So I wanted to call in today for two reasons.
One, to be encouraging to rural communities who are having these kinds of struggles that there are solutions out there, I would encourage everyone to first talk to their residents and see where things are at, and then reach out to midsize and smaller providers and some large providers to see and to have those conversations that you're talking about having with Frontier. How can we serve this population in a way that makes sense for the provider as well in terms of revenue or other issues? So that is something that works, doing a grassroots effort, talking to all stakeholders, then talking to providers as a stakeholder and seeing what can happen. We do have a provider. So to answer one of the commissioner's questions from this morning, are there providers out there who are able to do this?
Yes, there are. We found one. We have rural residents now connected for school from a provider who was willing to have that conversation. We just installed one and signed up yesterday, in fact, from a really small rural community of Grime. Exciting.
But the other reason I'm calling is because I would not, in under any circumstance, be having that conversation with Trent here. He's been here for thirty years. We do have the copper lines, and our copper lines have water in them when it rains to the point that the technicians even say, just wait for the water to dry out. Just wait for the rain to dry out. They're not going to come and do any kind of repairs or anything.
Just wait for it to dry out. I've had parents with special needs students.
Speaker 27
Miss Amber, could I get just interrupt you. Could I just apologize? I apologize for interrupting you. The court reporter would just ask if you just speak a little bit more slowly so she can she's taking down everything you're saying. So if could just Oh, thank slow down a little bit.
Thank you. Please go ahead.
Speaker 34
Yeah. A little nervous, folks. So I've had some special needs parent parents with special needs students who then their Internet went out and wasn't getting addressed to be resolved until that person actually had to reach out to legislators to get action on the repair for the Internet at her home, and she has some high need students in that home. Also, a parent who called in for some low SES programming from Frontier and was given the runaround a lot of hoop jumping so that their practices are then prohibitive for these parents to engage those kind of lower income, low SES, good pricing programs here, such as getting a password for a portal, emailing, voice mail calls back and forth for weeks and weeks to the point that the person called to get service under that program in April and has it has yet to be installed, and we're into October. Another parent called in, subscribed to Frontier service, and then found out about the Veletta SCS program, so called back into Frontier to ask for that rate, which she did qualify for.
And Frontier customer service let her know, no. You would not want that service. It's really slow. It's really bad. You would not want that.
So she ended up staying with a higher rate plan even though she qualified for the low SES service that was being offered. There was an advocacy group that we worked with that called and heard about what the work I was doing and said, oh, yeah. The Chromebook program they're doing is just not gonna work for your area because Frontier doesn't work well in your area. So there's just example after example of parents and families and real humans I've talked to with the struggle of Frontier in our as our primary provider here for thirty years. There's been no investment, but there has been quite a lot of deceit, neglect, prohibitive practices, and even oppressive practices, I would argue.
And I got in a little to the funding and to reports about where they absorbed a $140,000,000 in Connect America two funds in California and even claimed to deploy addresses in my hometown of Barbaco, California to streets that are super rural, such as Wire Road or Ome Road, which just are not the case. For as an example, the only site on Ulm Road is a cemetery. So unless people in their in their gravestones are going online, that's just not an accurate report of where those funds went or where those appointments went. So I encourage people to have these kinds of conversations, and I encourage the commission to please consider not just getting the creditors, you know, even or getting back some money for their shareholders, which, of course, I understand that, but really look at the impact that Frontier is having on communities, which, from my perspective, is damaging and blocking of opportunities that where quality providers could come in. In some cases, they do have a true monopoly monopoly.
In other cases, they're just not willing to partner with folks and those sorts of things. So I agree, and I'm very thankful for the callers on the first half of the day who were describing some of these similar issues with their relationships or projects or experiences with Frontier, the woman who was representing the tribal people and the gentlemen. I also agree with the district two or was it district three supervisor who was talking about having opportunities to improve things and didn't. So in his district, there was a fire one time, and that would have been an opportunity to make some improvements as they made the repair, and they chose not to and to went ahead and did fiber I mean, copper instead. And there are fiber in some of these communities, usually, and sometimes installed by the home developer or something.
And so really, communities can start looking at other industries to help out as well, such as a house developer who can help install fiber as they're installing the home I mean, new homes new home builds and go from there. There's a lot of solutions out there, and I'm happy to talk with anyone listening or any of the commission about any of this. But I would really rather see instead of some care reorganizing as they be held accountable. Can
Speaker 29
you hear me? Ma'am, would you I just wanna this is the court reporter. I'm sorry to put the brakes on. Before you leave the line, I need you to spell your name. And if you could slow down a bit, that would be very helpful.
Thanks.
Speaker 34
Yes. Thank you. So I would prefer that Frontier not only be not allowed to reorganize and continue in this manner, but also be held accountable for their actions thus far. Alright. And that is what I have to say.
Speaker 27
Very good. Miss Denver, could you please spell your first and last name for the court reporter?
Speaker 34
A l e n a a n, b as in boy, e r, g as in George. And I'm happy to answer questions or to be available outside of this meeting.
Speaker 27
Operator, do you have any other callers on the line who are waiting to speak?
Speaker 27
Okay. We are going to wait. Give a minute or so to see whether there are any other callers. Alright. Operator, anyone else who's called in?
Speaker 27
Alright. We are going to I'll give one more opportunity for the caller to call in. Operator, is anyone else called in?
Speaker 27
I'm going to go ahead and make some closing statements. If at any time before I finish with those statements, operator, please interrupt me and let me know if someone has called in. Certainly want to give everyone an opportunity to make any comments that they wish. I want to thank you, operator, for your work. That appears to conclude all the speakers who informed us that they wish to speak at this segment of the workshop.
If anyone listening would like to provide additional input or comments after the workshop, you may submit written comments on the docket card for this proceeding, which can be found on the Commission's website at cpuc.ca.gov. If you need assistance with providing additional comments, please contact the Commission's Public Advisers Office. In addition, we will be conducting a public participation hearing beginning at 05:30 p. M. Today, where you or any member of the public will also have an opportunity to speak regarding this proceeding.
To participate in that public participation hearing, you are going to call the same number that we were using for public comments for this workshop, and that phone number is (800) 857-1917. And press the access code 721384. And after you call in, you must then press 1, and you'll be placed in line to speak. Before we end, Commissioner Bismuth Ezeves, would you like to make any closing comments?
Speaker 3
Thank you, Judge Brzezinski. No, I just I look forward to any additional public comments later this evening. And I really just want to thank and appreciate all of the speakers today, including the applicant, the parties and most importantly the local government representatives and some of the professional policy thinkers that we had as well. So I really appreciate everyone's work and particularly all the staff's work and getting everyone how all the logistics worked out. We obviously had a couple of false emergencies today.
So thank you for working through those. And I look forward to checking back in a little bit. Thank you.
Speaker 27
Very good. Thank you, Commissioner Bismondo Sabes. Operator, before I close this proceeding, has anyone else called in? Operator, has anyone else called in?
Speaker 7
Your Honor, this is Robert Stanford. No one else has called in at this time.
Speaker 27
Okay. Very good. Thank you, Robert. That concludes this public workshop. Thank you all for your participation, and we are off the record.
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