-: The feed for this streaming event brought to you ...
-: They could be given a chance to speak by calling
in or sending their input by email,
I will provide more instructions shortly.
My name is Shonta Bryant filling in for Llela Tan-Walsh who
is the Program and Project Supervisor
of the Communications Division Licensing
and Compliance Program, she will be your host for today.
At this time, please allow me to go
through some useful information to get us
through this event.
The Commission is hosting this public events
to help address whether the transfer
of control applications filed by Frontier Communications
and its California subsidiaries is in the public interest
and whether the approval should be subject to conditions.
The docket number for the Frontier transfer application
is application A.20-05-010.
The assigned Commissioner
is Commissioner Martha Guzman Aceves
and the assigned Administrative Law Judge
is ALJ. Peter Rosinski.
Some of the topics discussed as today's workshop
may cover issues related to Commission proceedings
other than this proceedings, A.20-05-010.
Please refrain from discussing any Commission proceeding
other than this proceeding during this workshop.
In today's agenda, after a welcome note
from Commissioner Guzman Aceves, we will proceed
with a presentation from Frontier Communications,
followed by a presentation
from communications division staff.
There will be two panel discussion sessions
which will accommodate time for public input
via questions or comments.
Public input during the actual panel discussion
can be made by sending an email
so telco.events@cpuc.ca.gov,
that t-e-l-c-o dot e-v-e-n-t-s at cpuc.ca.gov.
When it is time to go over the panel Q&A session,
the phone line will be open to hear callers who wish
to provide an input and I will be back in the emails
in the order, I'm sorry, I will read back the emails
in the order they were received.
We will do our best to get through all emails
within the limited time we have.
Only if you wish to provide an input via phone please dial
into 1-800-857-1917 and interpass code 7218384
and press star one.
You will be placed into a queue and the operator
will take your name and organization.
Due to the high call volume,
there will be a slight delay
from the time you press star one to the time
the operator asks for your information,
please be patient and stay on the line.
You will be called on upon to speak when it is time.
After the panel discussion and a short break,
we will hear inputs from parties
of this proceeding including Public Advocate's office, TURN,
the Greenlining Institute, CWA,
CforAT and Rural County of Representatives of California.
At or around 3:40 p.m,
we will begin our public comment period with ALJ.
A court reporter will transcribe participant comments
and there are no more comments to be made,
we will conclude the workshop.
The public participation hearing will start at 5:30 p.m.
The public is given an opportunity to file comments
on the application and it will be transcribed
by a court reporter.
Finally, the public can write written comments,
public comments while the proceeding is open.
Visit the Commission website and search
for docket number A.20-05-010.
Use the add public comment button on the public comment tab
of the docket card for this proceeding.
At this time, I would like to turn your attention
to Commissioner Martha Guzman Aceves
for her welcome remarks.
-: Thank you Ms. Bryant and good morning everyone.
Thank you very much for being with us today
for this very important review of this application.
I wanna especially thank all the local leaders
who have taken the time from I know
they're very extremely busy days and time during
this state of the world and nation and of course,
most importantly, locally here in California.
This time pandemic of course has caused a lot
of human and economic suffering,
exasperating many inequalities and access to high quality,
reliable and reasonably priced communication service
is one of those inequalities.
And the importance of recognizing that many
of those served by Frontier are unfortunately likely
not able to participate today so I wanna make sure
to acknowledge that the lack of connectivity
by many communities is still a barrier especially ironic
in these types of proceedings.
As you all know, our communications division staff released
a report on Frontier service quality on September 17th
which they're going to present in a little while.
I know also, that Frontier has some disputes on the facts
of that report and we will obviously be taking a close look
at those objections 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 income 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,
a General Order 133 requires the carrier to repair 90%
of those outages within 24 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 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 territory terms and conditions
as it does currently and elsewhere,
that restructuring will be for all practical purposes,
imperceptible to customers.
In the restructuring plan it filed with the bankruptcy court
though, Frontier seems to recognize
that some of the service needs to be better.
It proposed to create a virtual separation
under the same ownership structure,
a select state operations where the reorganized debtors who
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 a 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 the 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 ImproveCo in those parts of 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 a 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 wanna challenge everyone in this meeting and discussion,
Commission staff, Frontier, intervenors, panelists,
members of the public to think creatively
and constructively about how we can do a better Frontier.
I wanna 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 do a workshop report
which our communications division staff to 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 wanna thank you and look forward
to this great discussion.
-: Hi, this is Llela, can everybody hear me now?
-: And Ms. Bryant before you transfer over
to the first presentation,
I did wanna see if any of my fellow Commissioners,
I see that Commissioner Rechtschaffen and President Batjer
and Commissioner Randolph are all
on and if they had any remarks to make
before I would open it to them.
-: This is Commissioner Randolph, I don't have any remarks,
thank you very much for convening
this workshop Commissioner, Guzman Aceves.
-: This is Commissioner Rechtschaffen, nothing more except
to underscore how important what Commissioner Guzman Aceves
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.
-: Test.
-: President Batjer.
Okay, not seeing maybe she's not on voice yet.
Okay, Ms. Bryant or Llela if you're back
on I think we're ready to move to the Frontier presentation.
-: Sounds good, thank you Commissioner.
We will go ahead and move to the presentation
for Frontier at this time.
Allison you may begin.
-: Sorry, I was on mute.
I'm just trying to, it 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?
-: Yes, we can.
-: Rosvall, are you able to advance the slides themselves?
-: Joe Haga can you advance the slides please?
-: Just to the next page, please.
So as we're doing that, I just would like to say thank you
to President Batjer and the other Commissioners
for allowing Frontier the opportunity to present
it today's event.
I'm Allison Ellis SVP of Regulatory Affairs
on behalf of Frontier we
also have Kevin Saville our General Counsel,
Patrick Rosvall 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 Guzman Aceves 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 Saville 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 efforts.
In terms of Frontiers 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 acquired varieties 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 2800 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 footprints.
Customers are increasingly selecting wireless services
and are cutting our cord entirely.
As the CPUCs 2019 report showed Frontier now serves
only about 15% of the 5 million regulated voice lines
in California and the CDC review
of voice subscribership backs this up,
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 income that LECs traditionally we're,
we're an earth 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 a billion 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, you know,
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 10/1 megabit service
to approximately 90,000 households in some 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 end of 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
and Frontier was able to make the commitment
to expand broadband availability in California.
As of August of 2020, we have completed
about 74,000 CAF II locations,
roughly 2400 of those locations are in tribal areas,
including the Yurok, Soboba, Morongo
and Torres-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 757,000 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 commitments
and expect to be completed with our annual objectives
by the end of this 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 FCCs mechanism.
The last component of our broadband expansion
is that Frontier has been a big participant
in the CASF the state's CASF grant program,
we have been awarded 13 grants to deploy broadband service
to over 8600 households and we currently
have 10 grant applications
for Fiber-to-the-Premises grants pending
with the Commission.
If those are approved, an additional 3000 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 support low-income access to services,
we participate in the Lifeline program,
we offer to affordable broadband.
Sorry, I'm getting some feedback.
We offer to 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 were very proud of a joint effort
that we undertook with CETF in response
to the COVID-19 pandemic, we work to identify schoolchildren
in high need school districts
and have prioritized distribution of 5000 Chromebooks
to those students.
We actually have an event next week scheduled
to distribute Chromebooks to tribal schoolchildren
so we've worked very hard to try
to help address some of the connectivity issues
that schoolchildren 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 24-hour out
of service restoral metric continues to be a challenge,
however we have consistent with the CPUCs rules,
invested it 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 6.8 million
in targeted investment on service quality.
These projects have all been reviewed by the Commission
and approved by the Commission and, you know,
are a step that we're taking to ensure
that we can address some of the voice quality issues
that we have had and some of our, you know,
more difficult to serve areas of our footprint.
And Joe if you could turn it to the next slide,
I'd like turn the presentation over to Kevin Seville who
can address the next few slides.
-: Thank you all Allison and my name is Kevin Saville,
I am the General Counsel at Frontier Communications
And as Ms. Ellis indicated, you know,
we do appreciate the opportunity to make
this presentation to the Commission.
Ms. Ellis as you know focused on some
of the California specifics in terms of our operations
in the state, I wanna just, you know,
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 $8.1 billion but we experienced a loss
of approximately $5.99 billion.
Frontier also had significant debt which amounted
to approximately $17.5 billion of outstanding funded debt
and the company was paying annual interest expense
of approximately $1.5 billion per year.
To address these unsustainable levels of debt
and to better positioned Frontier to meet
its customer needs and to compete, you know,
in a changing telecommunications marketplace, you know,
Frontier proactively engaged in a effort to negotiate
a restructuring of its debt with his 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 presentations,
you know, 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 $17.5 billion of debt
and reduce it to approximately $6.5 billion.
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 21st of this year,
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 on impairment.
What that means is that effectively, you know,
all of our collective bargaining agreements with unions,
all of our contracts with our vendors,
all of our third party, you know,
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 2021.
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 you know,
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-19 changes
in the economy and certainly changes
in a very dynamic competitive landscape in California.
As I mentioned, the restructuring is positive
for California stakeholders in that California
is a very important state to Frontier and having shed,
you know, $1 billion a year in interest
and 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, you know,
will be unimpacted by the Chapter 11 and, you know,
our operating subsidiaries will continue
to operate in accordance
with their existing regulatory authorizations issued
by the Commission.
Conversely, denying or delaying the position,
you know, 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 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, you know, 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 in fact impede our ability
to fulfill our build out requirements
with respect to broadband.
So let me turn to Mr. Rosvall to cover the last slide.
-: 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 do appreciate
the opportunity to present today
and provide these opening remarks.
My 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, that that event which is linked
to the restructuring does trigger the requirements
with Public Utilities Code 854
and so that's the primary statute, as you know,
that governs transfers of control.
Frontier also filed under Section 853
which permits the Commission to limit some of the aspects
of Section 854 where they aren't applicable
or aren't appropriate for that particular transaction
and indeed, the Commission did
that here with the scoping memo excluded a few
of the subsections of Section 854.
From the analysis, notably Section 854(b)(2)
which is sort of a relic of 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 the numerical analysis
of how to allocate those benefits.
In this case, we're dealing with a parent 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
and then there are a couple of other aspects
that were excluded from a 854.
And the remaining 854 factors, as you know,
pertain to issues that analyze the effects
of the restructuring and the transfer of control
on various aspects of Frontiers operations,
the considered unifying concept, though,
is that all those factors should relate to the effects
of the restructuring effect with the transfer of control.
And so I guess in light of 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 854.
The first one is just in 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 forma entity that would come out
of this 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 that 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 as,
you know, 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 854 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,
balanced the interests of the stakeholders
that are affected by the plan itself.
And then the third thing which Kevin hit on
and 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,
the evidentiary hearings in a few weeks at a time
that would allow for timely resolution
of this matter because the benefits
are contingent nationwide on getting all
of the approvals necessary.
So that's why I wanted to highlight
some of the unique features of this particular situation
that might be different
than some of your typical 854 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.
Thank you Commissioners.
-: Thank you Frontier for the presentation.
Commissioner, do you have any questions
or does the President would like to say anything?
-: Yes, President Batjer if you had like any,
I know your sound was off earlier but it'll just open
to you now if you'd like.
-: 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.
-: Do any of my fellow Commissioners
have any follow up questions?
-: No, I don't.
-: Okay Llela.
-: Great, with that we will now move
to communication staff presentation led
by Michaela Pangilinan and Michaela
is a Senior Regulatory Analyst
in the Communications Division.
Michaela, you may start.
-: Thanks everybody, good morning.
Waiting on the slides to pop up under on the WebEx.
-: Please stand by while we navigate to the slide, thank you.
Please stand by and we're gonna splash up the slides
in just a second here.
-: Okay great, it 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
the company using a simple map developed by our GIS 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
the ultimate on non-discriminatory basis.
After Frontier acquired Verizon's assets in 2016,
Frontier expanded its service footprint
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 Frontiers 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 location
is where Verizon built its Fios network.
These same counties also represent the largest concentration
of Frontier subscribers
for fixed broadband Internet access services.
Next slide.
For this map, I wanted to show that Frontier offers
a higher advertised downstream 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, Kings, Nevada, Butte,
and Sacramento County.
Otherwise, Frontier mostly offers advertised downstream
speeds of less than 100 megabits per second in California.
Next slide.
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 underserved households.
This program has about a $300 million dollar budget
to spend on eligible projects in 2022.
Since November 2018,
the Commission has approved CASF 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 about 41,000 to $11 million.
But Frontier receives a much larger portion
of government support
from the Federal Communications Commission
Universal Service Programs.
California's portion of the money Frontier received
from this government is a 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 phone service is high.
So Frontier is one of the two carriers
of last resort along with AT&T offering basic phone services
in areas subsidized by 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 Aceves pointed
out earlier Frontiers service stories is well represented
in highly populated areas of Southern California,
and Inland Empire but a good deal of areas
are in rural locations.
Next slide.
This map represents the out of service repair interval
as reported by Frontier and it includes all three
of those companies listed there.
The CPUC establish uniform minimum standards of service
and reporting requirements
for public utility telephone Corporation
in General Order 133-D.
The out of service repair interval measures
the average interval
between the time a telephone Corporation responds out
of service trouble report and the restoration
of the customer service.
The standard is 90% of the out
of service trouble reports restored in 24 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 outages that occurred on Sundays,
federal holidays, catastrophic events
and or declared disasters because they are excludable
under General Order 133-D.
In 2019, just in case it's difficult to see,
there is this no county
in which Frontier reported meaning out of service standard
at the county level meaning as you
can see the map shows there are no green colored County.
But most of the counties Frontier reported
that it resolved less than 60% of the outages
within 24 hours.
Next slide.
This map uses Frontiers reported out of service data
to show their 2019 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, federal holidays, catastrophic events
and or declared disasters.
Looking at this map, it appears that consumers
in Mendocino, Tahoma, Sutter, Sonoma,
Santa Clara, Kern and Ventura County,
experienced along this outage duration
and service restoration times.
So I have eight minutes remaining for this portion
before we begin panel one so perhaps it would 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.
Llela if you wanna prompt.
-: Hi, yes, thank you very much Michaela
for the presentation.
Do we have any questions from any
of our Commissioners at this time?
-: No questions, Llela,
I don't know if there's anything on the chat,
any clarifying questions that we should look
at from the public.
-: 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?
-: Yes, thank you.
I show no callers in the queue at this time but if you
would like to ask a question, you may press star one,
unmute your phone and record your name and organization
when prompted clearly so I may introduce you.
Again that is star one to ask a question or make a comment.
Please stand by it may take a few moments for questions
to come in.
-: Thank you operator, we will check back in a few seconds.
-: Well, I have a question while we're waiting
and 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 talked about High Cost Fund-B and CASF,
Frontier also receives and participates
in the lifeline program and I know that 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?
-: Well, I can tell you that we, you know,
we continue to advertise the lifeline program
and to seek to connect customers with it.
Let me turn my video back on.
Sorry, you can see me now, Yes.
So we 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, you 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 it 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.
-: Great, 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?
-: And I have no caller thank you at this time but again,
that is star one if you would like to ask a question
or make a comment.
-: Okay, 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 o'clock, is that okay with everybody?
So we will take a quick break and then we will move
to our panel discussion at 11, thank you, everyone.
we'll the public know when we are open for questions,
input or comments.
You may also send your questions
or input for the panelists by email by sending
it to telco.events@cpuc.ca.gov.
Karen, you're ready?
-: I am, thank you Llela 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 panelist,
can you advance the chart please, Haga?
-: Sorry.
-: Thank you, that's the one I wanna say,
thank you very much.
Our first panelist is Dore Bietz, who is a Northern
and Southern Me-Wuk and resides on the Tuolumne ranch area.
She's a former council woman who now specializes
in California Indian land issues at both the state
and the federal level.
Ms. Bietz is a Planner and Emergency Manager
for the Tuolumne Me-Wuk 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 17 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 20 years.
Mr. Rantanen is Cree from First Nations Canada
and is also Finish 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 he is also a member
of the FCC's Native Nations Broadband Task Force.
Now we'll move up to Mono County where Fred Stump
is the Supervisor of District Two.
He was first elected to the Board of Supervisors in 2012.
Thank you Joe, if you could show the overview chart.
And Supervisor Stump was reelected in 2016
and he has a long career in public service
and spent over 35 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 Plumas 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?
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. Bietz 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.
-: Good morning everyone, can you hear me?
-: Yes, we can.
-: Alrighty, I think we'll go to the first slide Joe.
(speaks in foreign language)
My name is Dore Bietz on behalf
of the Tuolumne Me-Wuk 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 tribes planner and emergency manager,
I am a tribal member and I reside here on tribal lands.
Next slide please Joe.
We are a federally recognized tribe located
in Tuolumne County here in California.
we oversee and manage approximately 2000 acres of land,
some of which is in tribal trust and other
that is in trouble fee.
We have approximately 496 tribal members
and with 100 homes currently on tribal trust lands 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, an RV Resort and a gas station.
We are the second largest employer in Tuolumne County.
Next slide please Joe.
This is 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.
So I wanna, back one.
-: There we go.
-: So I wanna talk a little bit about our experience
with Frontier.
I have lived here since 1993, spent a lot of my summers
here as a child with my grandparents,
that 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 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 lands
in the town of Tuolumne.
Up until 2005 Frontier wasn't able to provide
even common PRI service.
When we opened our casino in 2005,
Frontier actually refused to install fiber
to our new facility.
Discovering 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 plan that was actually located
on the ranch area.
There was poor installation of all the equipment,
not linked circuits, refusal to ground equipment,
poor wire management.
All of these instances resulted in having no choice
for 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 its issues especially with power outages
but it's better than what we
have 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 departments staff
are actually pleased to no longer rely on Frontier
for communications as it 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.
To tell a story about my mother who retired from AT&T.
In fact, my grandmother who was tribal chair in the 70s,
retired from Mabel, she was a telephone operator
and worked in Sonora.
My mother then retired from AT&T as a systems engineer.
My mother is often going out to the box
to fix things herself and she has 78 years old.
The most recent impacts of COVID including distance learning
and working from home where parents and kids have to rely
on the internet and that has truly taken a toll.
On weekend 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 DSL 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 responsibility to continue to grow
without providing adequate services.
It was great to hear that there has been some areas
within tribal communities in 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 wanna 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 improve 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
and 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
as fiber deployment would show proper initiative
as it is modern and meaningful upgrade to a network
that is barely functional currently today.
Next slide please Joe.
In closing, I wanna thank the Commissioners,
I wanna 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.
-: Thank you very much Ms. Bietz,
we will take questions when all of the speakers
have finished their presentation.
Mr. Ramirez, are you ready for your remarks?
-: Absolutely, thank you very much.
First of all, I would like to thank President Batjer
and Commissioner Aceves for this opportunity,
very much appreciated.
I also would like to start by 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.
Our biggest employer here is Foster Farms,
Foster Farms it's world headquarters is located here
and 3700 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,
we 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 infrastructure
' in the highway.
So I've been here in the city of 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 as relates to Frontier service.
Unfortunately and I know given and this is pre COVID,
you know, 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 gonna pivot
and just specifically talk about the municipality side.
We've had a lot of different challenges, you know,
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, you know,
I've been trying to get Frontiers attention
and so I've used different ways to do that,
I've reached out to my congressman, to former employees
and finally, I reached out to CETF and was able
to make contact with them.
It was December 18th
of last year and I basically reached out to them
and said look, there's an opportunity to partner here,
there's some CASF 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 Warshauer 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 April 15th of 2020.
I know that COVID played a lot of role, you know,
bringing 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 wanna move from here and talk about some
of the good things that have happened since then.
Through CETF, you know,
they of course they talked a little bit about providing
the 50,000 Chromebooks initiatives
and 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 partnering with the CASF grant
in the future and that we might get some investment
here and I think there's a lot of opportunities.
You know, I think 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 good, it's a big lift.
So, again, we value the opportunity to work with them
in the near future to connect broadband to all.
So thank you.
-: Thank you Mr. Ramirez, I appreciate your comments.
Mr. Rantanen are you ready to speak?
Can you?
-: I am.
-: Perfect we can hear you just fine too.
-: So thank you everyone for for having me and Karen
for organizing and good introduction there,
I just will have a little bit of a correction on the intro,
I was to term member
of the FCC Native Nations Broadband Task Force
and am not currently active so just wanted
to make sure people understood
that but having been at the national level dealing
with tribal information, tribal technology
and travel opportunity and policy for the last 18 years,
you know, building in and deploying and designing
a wireless and fiber travel network
that's over 650 miles long for the last 19 years
and I think it's tomorrow starting my 20th 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 folks at CETF reached out to me,
we have a good relationship in the policy space
and 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 opportunity to get access to some Chromebooks.
And, you know, through some talking and working on numbers,
we are going to be the recipient
or actually are the recipients of 350 Chromebooks
for students in the Southern California Tribal
Chairman's Association member tribes.
It fulfills most of the need,
we got another grant from San Diego Foundation
but I did not know that Frontiers money was supporting
that so until we actually got into the conversation
with with CETF 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 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 communities.
You know, it was on the cusp of changing over
from dial-up service to potentially T1 or found a T1
and moving into, you know, DS3 or OC-3, 45 Meg's on copper,
it was right in that transition period
of when networks were starting 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
of the time and none of the carriers
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 19 years later,
650 miles point-to-point,
point-to-multipoint wireless network that's supported
by AT&T fiber on one end and a CenturyLink fiber
on the other end.
And the AT&T fiber is actually through CENIC
so we're actually utilizing California's Research
and Education Network 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 assets in California
and right when that happened,
a Frontier representatives claiming
to be the tribal liaison came out into Indian country
in California and was told to engage with me,
maybe if you haven't seen me in person,
I'm six foot four about 270 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've worked with a lot of tribes in 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 and very tied up
with a lot of the different tribes and the efforts
that are going on and you have this network, et cetera,
et cetera, what are the things that funds here
can do to help you moving forward?
And I have to say I'm, you know,
I'm kind of over that pitch,
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 just never happens,
it never materializes.
So within 45 to 60 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 gonna be moving
through the future as a vendor to Indian country,
potentially even a partner to Indian country
in the telecommunication offering, disappeared, gone.
45 to 60 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 don't know the circumstances
but and then you know, crickets, 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 and that needs to be improved
upon moving forward.
If you engage a tribe
and you talk about solutions and opportunities
and feel that these are opportunities that the Frontier
can be a part of and partner with a tribe
to find solutions then, you know,
follow through is you know,
the next step to learn in working with Indian country.
Another example of issues with things that have happened
with Frontier over time,
Telephony Advanced Services Fund serves California's efforts
to try to get broadband in place for places
in Indian Country and 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 communication 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 25 years and the results
still haven't cleared Indian country.
So we're seeing some creativity,
we're seeing some opportunity happen and we're seeing
some real traction in getting efforts into 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 full of flaws and failure when there are companies
that are providing 100 Meg's symmetrical,
true fiber to the home through a new creative process
that is not a traditional broadband company
and seeking CASF funding help and getting opposition
from a company that is only prepared to deliver 6/1.
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
in today's needs for broadband but legacy equipment,
not upgrading network, you know,
fighting against alternative solutions and competition
that brings in a much better product isn't acceptable
for Indian country, 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 wanna start somewhere back
in the legacy process moving forward
to today's standards over time,
we wanna start today where we are today
with those standards, we don't wanna step into 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 infrastructure and support of the infrastructure,
upgrading gear and upgrading services is part
of being a telecommunications company.
I've run a company for 19 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 a small potatoes
so we expect those larger companies
to be able to do the same.
And that on that same sentiment I've done a lot
of work nationally to support tribes
and getting a 2.5 gigahertz license tribal priority license
that the FCC.
Personally touched conversations
and interacted with about 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 medics in their service area
but take that to heart we're going to find a solution.
We'd like to find the solution for you,
if you can advance your offerings and bring a solution
that is relevant today.
And I guess Lastly, I would just like to make the comment
that tribes may be interested in portions of your network
in your bankruptcy proceedings if you're carving sections
of your network off or facilities, you know,
this is a precedent that's been set,
many times tribes have taken over components
of telephone companies as they dissolved assets
or broken up monopolies and different things.
We have a good example
in Gila River communities GRTI acquired a major portion
of a phone company and became the service provider
for their own people as well as some
of their surrounding population that are non-tribal
so consider that 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 at least a little bit constructive moving forward
for you, thank you for your time.
-: Thank you, Mr. Rantanen.
Our next speaker is Supervisors Stump.
Joe, Supervisor Stump has charts available as well
and Supervisor Stump can you say something,
are you ready to go?
-: I am ready to go, can you hear me?
-: We can hear you perfect, thank you, go ahead.
-: And good morning, I want to thank the Commission
for the opportunity.
I particularly wish to thank the Chair,
Commissioner Guzman Aceves 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 Two.
There is one incorporated community in Mono County
that is the Community of Mammoth Lakes,
I am the only county supervisor
that does not represent a portion of that community.
District Two 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 Sok to confirm
that I had his permission to represent the tribe
and also to make 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 spec 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 you so you're 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 395
as has this Commission for which we are very grateful.
We have actually function
to run the local broadband consortium
and we have deployed gigabit broadband to 95%
of mono households, unfortunately 95% does not include most
of District Two.
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,
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 and 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 didn't the opportunity to install fiber optic,
although it could have been supported was not taken.
Second, I wanna say that there's a lack of route diversity
and that is primarily due to Frontiers refusal
to adopt Digital 395, it should be used actively,
it is in both the highway six
and highway 395 corridors which I represent.
I am informed that Frontier will bridge
using Digital 395 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 the behalf Frontier
there is no backup.
When power failures, particularly in the area served
by aging copper wire infrastructure, there is no backup,
the phones fail.
And what brought this point 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.
911 has to be available particularly
when you have a rural senior population
and when it doesn't work that is not acceptable.
Results, 911 outages, numerous landline,
cellular and power safety shutoff 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 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 gonna 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 life-line customer issues
and I have to reference I have had many complaints
from my residents about price increases
and the difficulty in obtaining life-line 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, et cetera.
Encumbering of CAF II monies.
Well, I 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 divide 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,
this source of funding is just restricting what can happen.
I have local groups that are willing to form nonprofits
to provide service within their area 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.
You know, how 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 residents, however,
the basic downfall and antiquity of the system remains.
Potentially empower local tech's, Frontier needs
to empower its local tech's 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 gonna say again, require Frontier
to relinquish CAF monies in geographies
that are not being used and frankly,
Mono County was the 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.
-: Thank you Supervisor Stump.
We will go now from Mono county to Plumas County,
Supervisor Goss are you ready for your remarks?
-: 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 compliment all four
of the previous speakers, all of the issues
that they spoke of are definitely happening here
in Indian Valley, Plumas County.
A little background on Plumas County, Indian Valley.
17 to 18,000 people in the county, one incorporated city
on the eastern side and old logging communities, mining,
which is 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 for eight years,
I am currently the Plumas County Representative for RCRC,
Regional Council Rural Counties is what 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 gonna come
in and angle from are the small business side
which we own a pharmacy here in Greenville
and for more the governmental side
and a project that I worked on for a little over 15
to 20 years with fellow supervisor, Robert Meacher.
We'll start off with the Rule 20 project
which I'm not sure if everybody's familiar
with but it is a cooperative project with PG&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 15 to 20 years like I said
in the 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 jeopardize
the project completely which was a no go for me
and a lot of others had spent so much time on this.
And went back and forth with Frontier
for 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 rep saying no, we're gonna pull the plug
on a 15 minute $20 million 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 her 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
has been dealing with us and that's just on that side of it,
not 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 shopping,
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
and there is a wireless company DigitalPath here in the area
that has some coverage area but that's just there in front
of a mountain top.
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 strongly suggest
that you work with your partners because we
have on either side of us up
in Susanville to the north of us PSREC
which is Plumas-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 on a plan going forward
for at least for Plumas County,
is they make that connection and make that loop
because the fire that happened outside of,
the Hog Fire fire I believe is what it was called,
outside of Susanville burned
up their copper lines servicing Plumas county
and we were down our businesses all down
for at least I think three days.
Putting out here at the pharmacy,
putting out thousand dollar prescriptions
not knowing whether you're gonna get paid
or not is not exactly a 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
is 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, you know, I don't wanna 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 will conclude my comments, thank you.
-: 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 line
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 Batjer if you have any, you know,
good place to start.
-: Well, thank you very much Karen
and I really appreciate this panel.
Very interesting, very telling,
I 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 and Kevin too and both Plumas
and Mono experience PSPS.
I think Fred you represent
the southern part of the county and that part of county
has had several power shut offs in the 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 that is that correct?
-: Would you like me to take that first?
-: Yeah, that'd be great.
-: First I am calling from Crowley Lake
which is on highway 395 about 10 miles south
of Mammoth Lakes, it's where I live.
-: I know 395 very well, I grew up in Carson City,
Nevada so ... -: Okay.
-: And my family is the Pioneering family
from Smith Valley so I know and I was a ski racer
so I spent a lot of my youth at Mammoth.
(laughs)
-: It will be interesting to see how Mammoth deals
with COVID in reopening.
California Public Health as dealing
with cold weather environments is something
that they're having to learn about as we as we go forward.
To your other questions, yes,
several PSPS events circuit information
through the original ones was very vague from SCE
this is an SCE county not PG&E.
And 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 systems still will function
even if the power's out.
However many 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&T and half
is on Verizon so I just picked AT&T to serve my folks.
But when you have no high speed internet,
you have no voice over 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 and hopefully
they have a satellite phone.
Hopefully that answered your question, thank you for asking.
-: Yeah, the Commission has been active in making sure
that there was good communication between both Edison
and telecommunications companies that serve
the Edison service area as well asPG&E
so something that I'll follow up on and Kevin,
same question to you regarding the PSPS
that Plumas county has experienced and what what happens
to your community when it comes to no power and no phones?
-: Sure, sure.
First of all, I'm calling from Greenville,
California, pretty much at the center of Plumas County.
When the power does go down here,
whether it's winter storm related or PSPS related,
here in Greenville there is a generator that kicks
on at Frontiers thing here that does re-energize
the line so I will say that if you have a generator
and you're available to get to power up and going
or you have a old fashioned princess phone
that plugs right in, you'll 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
that would be limited but yes, it is available.
-: And your own generator,
how much time do you have on that generator?
-: Eight hours.
-: Okay, got it, all right thank you ...
-: You know, I have a refrigerator full of about 50
to $60,000 worth of medications
that I also have to maintain so 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
so you don't have to ever come
in and manually start up the system only.
-: Okay, thank you both Fred and Kevin,
I appreciate your answers.
That's all Karen.
-: Okay, thank you very much.
Commissioner Guzman Aceves,
do you have questions for the panel?
-: Thank you, Karen and thank you again to all
of the speakers and all the dedication
that you have to your communities and 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 the 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 you're coming
into to really put a stop to that.
So I certainly would like to hear more about those details,
that doesn't have to be today because we need to ensure
that you in this process or another of our processes
that we are not allowing for that innovation to happen
so that folks can actually get service.
I did wanna ask perhaps a question,
I think Matt was one of the folks who said, you know,
the Frontiers kind of put out this concept of ImproveCo
and Invesco and my biggest fear
is that the ImproveCo territory that might frankly overlap
with your community, may be something
that they're looking to do less
with or potentially fell down the line,
I really don't know but the fact that they've made
this bifurcation is concerning.
And, you know, Matt you made kind of an offering
of a discussion of a potential option,
I wonder for Dore or Fred or Jose Antonio or anybody else,
is that's something that you think is an option for you?
And I don't know if I'm being clear here but but maybe Dore
if you wanna start and maybe go through lines quickly.
-: I mean are we open to those ideas and suggestions?
Absolutely and I think that Matt, you know,
hit on some very important key points that we
have to have those discussions and how do we do that?
Yeah, absolutely, we would be open to that.
-: Commissioner Aceves, 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 and 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, you know, it's Frontier,
if we're not to move forward and Frontier
was to start selling things off, you know,
would we be in a better spot?
I don't know, 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 CETF and the public benefits
and getting them back to towards economic health
so I'm definitely open.
-: Is it my turn?
-: Matt, did you have something to say on that?
-: Yeah, I can expand on that a little bit.
So I think the biggest fear is that the we're going
to see two different parts of Frontier,
the parts that they support and the parts
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 doesn't have support
and it doesn't have a feature.
So we would be more interested in having discussions
with Frontier about, you know, closing off that asset
and right away and the opportunity
there to maybe do something locally instead
of have it become dormant but still part of a company
that's fighting against you bringing innovation.
-: Thank you, Supervisors Stump, we will go to you next.
-: Yeah, I would in fact concur with those comments.
When you talk about Frontiers future,
checking share price today it's 26 cents a share,
Verizon on the other hand is 5966 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.
-: Thank you Supervisor Goss, would you like to take part
of that question?
-: Yeah, I would concur with everybody
that spoke but I will also say that we we too
would be interested at a county level of any kind of a,
maybe an independent district or an independent company
or something.
I mean, I don't think the county wants to get
into the internet business, not necessarily,
not right now anyway but it would be 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 Plumas County,
good, fast, reliable internet.
I know that a lot of folks I'm running for reelection
and one of 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
if we can get some good fiber up here or activate
the fiber that's already here and connect the, you know,
other companies together to us,
I think would be so beneficial and we would look forward
to those conversations.
-: Thank you.
Commissioner do you want to maybe go
to the other Commissioners and then come back to you?
-: Yes, please.
-: Okay, Commissioner Rechtschaffen,
do you want to go with the question?
-: 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,
if so I would like if they could respond briefly,
Dore 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 provide a modern internet speed wall 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
because Matt criticisms
and 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.
-: This is Allison Ellis, can you hear me?
-: Yes, we can Alison.
-: Yes, I'm happy to Commissioner to give him 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
have found ourselves in financial distress
and needing to avail ourselves
of the Chapter 11 bankruptcy reorganization process.
We have, you know, worked to deploy services independently
where we could and we have also utilized a CAF II funding
and CASF funding where that's been permissible.
And I think in all of the areas represented today,
there have been some, you know, CAF II 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 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 Frontiers 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, you know, of the of the state funding
and really be a good steward of that funding.
We, you know, have made improvements and projects,
improvements and broadband projects in many of these areas.
You know, just actually the summer in Tuolumne we upgraded
this, you know, 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,
you know, will be a big improvement for that area.
It expensive Ethernet access and capabilities
there and it also relieves broadband congestion and,
you know, that's just one example there are other projects
in other areas.
You know, in Plumas County we have a two phase project
and that in the northeast area,
one has already been funded by the Commission
but then there's 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,
if 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,
you know, a return on every investment that we make
to improve services and expand them where we can.
-: Thank you Ms. Ellis.
Commissioner Randolph, I'm looking at you,
would you like to take a question?
-: 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 we're gonna be really enthusiastic about working
with you and then and then we're gonna disappear.
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 gotta tell you, most feedback we get
is that nobody seems to be doing this all that well
so I would love to know if there's anybody who
is more effectively doing this kind of work.
-: This is Matt, I'll chime in on that real fast,
thank you Commissioner.
The experience we've had with all of the carriers
in our region in Southern California has, you know,
not been 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, you know,
getting access to, you know,
bigger broadband pipe especially
for the tribal 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 the CIO offices of the state
and having those relationships
and having those departments help us establish meetings
and establish interaction with those carriers that we wish
to engage with and Carlos Ramos back in the day extended
the state's broadband pricing to tribes
and negotiation support in getting into those meetings
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&T which has migrated
over to a CENIC network connection which is, you know,
far advantageous to us being on the CENIC network
and having access to all the resources of CENIC as well.
But even with CenturyLink, in the in the southeast part
of the county, the department helped us get in the door
with CenturyLink and negotiates the state's rates
and even then build a relationship
where I can negotiate further with without organization
so I've always just said it's 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 could make these deals without that assistance so,
you know, none of them are perfect,
some of them once engaged are much better than others.
-: Do any of the other panelists have an example
for Commissioner Randolph?
-: This is a Fred stump and thank you
for asking that question.
We do have a local entity that serves
as tapped into the Digital 395 fiber optic system
has actually constructed fiber optics to homes
that's raised communication,
grant funding from the CPUC enabled that company
to reach out in several of the county communities,
their pricing is reasonable and in terms of functionality
and reliability, they're 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 or has a limited reach
from where the point of origin is.
And the back to the Digital 395 component, it is there,
it is this not being utilized currently by this company
in a way that could alleviate some of the issues
that I spoke about.
-: I'll just chime in real quick Kevin Goss,
just talking about the fiber optic
that I was mentioning that was up to Susanville
and out to Pluma Feather River College
was put in by Plumas-Sierra Rural Electric Cooperative who
was a electrical company mainly and then went
into the digital arena with the funds
and was able to bring that fiber optic to Plumas County,
whereas a sense has just stopped on either side
of Indian Valley, Chester-Lake Almanor and Lake Almanor is,
you know, one of the huge areas that is underserved
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 Plumas-Sierra Rural Electric I think
would be a good contact, a good example.
-: Thank you very much.
Commissioner Shiroma ...
-: That's good to hear that it can be done, thank you.
-: Commissioner Shiroma,
do you have a question you'd like to ask
the panelists or multiple questions?
-: Actually, this question is for Frontier,
is Allison is still on the line or Kevin?
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
and 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 slash satisfaction slash experience?
And you've heard the complaints and the complaints
have been going on for years and our Cap unit
has received thousands of complaints,
do you have a root cause analysis or what's going
on other than just putting up with complaints?
Yes and have you done a root cause assessment
of yourself on what is causing it and what needs to change?
If you haven't, that's the ultimate answer to the question.
You know, written policies
and also have you done a deep root cause analysis
on what's going on with ...
-: Ms. Ellis, are you still with us?
-: Yes, I am and and I have actually turned on my video,
can you see me?
-: Yes.
-: Okay, 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
that areas and the issues that consumers are having with us.
As you can imagine because our service
is so particularized and you know,
a situation is different based on somebody's distance
to our equipment, sometimes but the complaints
are often quite specific to a specific customer.
We do value customer service,
we do value providing good customer service and, you know,
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.
You know, with our 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 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, you know,
it's an industry where there is a high level
of customer dissatisfaction versus customer satisfaction.
And 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, you know,
the customer ratings of their service
or their experience with the company, you know,
are generally not as positive as any
of the carriers would like.
-: Thank you Ms. Ellis.
-: And have a policy, I mean, actually,
where your board of directors has adopted a policy
on customer service as a priority?
-: We don't have, to my knowledge,
we don't have a board level approved customer service policy
but as I said, you know,
it is something that we train our representatives
and technicians too,
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,
you know, we have been seeing incremental improvements year
over year, you know, month over month,
year over a year but we're certainly
not at the level where we want to be quite yet,
that 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, you know, obviously,
that puts a lot of pressure on the organization
just generally puts pressure on, you know,
the ability to go above and beyond and do
for the customer what we, you know,
would otherwise be able to do
if we didn't have the financial constraints
that we are currently trying to eliminate frankly.
-: Thank you, Commissioners,
I know that you have many more questions and follow up
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 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 to respect
that time because there are many of you there.
I will ask Llela to help me with the emails
after the callers have spoken.
Operator, can you please announce the first caller?
-: The first caller is Christine Marques,
your line is now open.
-: 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 Commissioners 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 situation locally and there does appear
to be definitely a lack of cooperation by Frontier
on many levels and that is troubling.
TURN is sympathetic to the high cost
and the caller obligations that frankly 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 lack of willingness
to engage in local projects.
So I have two questions related to the restructuring.
I wanna 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
that issue.
I wanna make sure that part of the invest code decision
is to bring in these folks that are talking today
and others to have the investment being joint
with these organizations
and therefore I'm hoping this docket can document both
the right of first refusal 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.
-: Thank you Ms. Marques.
Can we have the next caller please?
-: I'm showing no further callers at this time.
-: Llela, can you please look at the email?
-: Absolutely, we have two emails.
One, let me start with the first one,
this is a question for Dore Bietz,
I'm gonna read verbatim here.
This is Cameron Reed with the public Advocate's Office.
Just a clarifying question regarding Comcast service.
You said you went to Comcast for Internet service
for the Me-Wuk government and businesses.
Does Comcast Offers 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.
-: So the business entity side went after our switchover
to Comcast because that was their really only alternative
and Comcast has not come into the residential side
which each individual then is responsible.
So we have not looked at extending the Comcast
into the tribal residential area currently right now.
-: Great and there's an additional comment from Cameron Reed.
I just want to thank the panelists
for their insightful comments,
I also want to say I appreciate Mr. Rantanen's choice
of background image.
We have a second set of question here,
let me just open this <v ->Go ahead Llela.
-: Okay, so this question is from Robert Langer,
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 panelists discussion one,
community experiences and needs to answer.
Number one, has Frontier informed you if your areas
will be considered Invesco or ImproveCo
if this bankruptcy is approved?
Second question, what is your view of how Frontier
is planning to separate California regions
into Invesco and ImproveCo?
That's the end of the question.
-: Okay, do any of the panelists have any answers for that?
-: Supervisor Stump here, I can answer those quickly.
Question one, the answer's no.
No information from Frontier on either one of those points.
Question two, unknown because of the answer to question one.
-: Thank you.
-: Supervisor Goss, answer to the first question is no.
Answer to the second question again
is unknown because of the first answer.
-: Panelist Ramirez, the answer is no and then no.
-: Ms. Bietz?
-: Yes, the answer is no and unknown as the other panelists.
-: Dido.
-: Thank you.
(laughs)
Okay.
Do you have a follow up with that Llela?
-: I have another question,
not really a question but a comment received
-: Excuse me.
-: Go ahead.
-: Llela, sorry 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.
-: As obviously this is a communications company
that we're dealing with so communication is utmost.
-: So, Commissioner this is Patrick Rosvall 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 get on ... -: I'm here Patrick.
So Commissioners, in terms of the question, you know,
the the differentiation between Invesco
and ImproveCo I know, you know,
to some that has a negative connotation but,
you know, our expectation is, is that, you know,
California is a very important state to us and we intend to,
you know, invest in the state of California and to bring,
you know, fiber to additional households
to the extent we can.
You know, the reality is, 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, you know, a need to evaluate where it makes sense
from a financial and practical standpoint to expand,
you know, deployment of investment and fiber
and that being said, the areas that don't get, you know,
new fiber deployment are not necessarily going to be,
you know, neglected.
Those areas are also going to receive investment
and 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,
you know, 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, you know,
board and management is going to undertake an evaluation
and do engineering analysis and detailed review
to determine, you know, where, you know,
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, you know, today go and say,
you know, this area is going to get, you know, fiber,
this area is only coming
to see you improve broadband deployment,
those decisions have not yet been made.
-: Thank you, Mr. Seville.
Llela, 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 less now?
-: Yes, we can have any additional questions
during the public comments in the afternoon
so if we don't get to all the questions right now we
will give them an opportunity to say
that or they can also send a public written comment.
-: Okay, thank you very much then Llela, I will turn
this back over to you now.
-: Sounds good, thank you.
I think we're having technical difficulties
which is timing because we are going
to move to our lunch break.
We will resume our program at 1:30
and we will degenerate panel two discussion, thank you.
-: 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 non-controversial topic of water.
-: Thank you Supervisor and thank you all so much
for the panelists that made the time
with so many crises they're facing
and I really do hope we can continue this dialogue.
Have a good lunch.
-: Thank you Commissioner.
-: This streaming event brought to you by Admin Monitor...
-: Patients 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 telco.events@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 the emails
within the limited time we have.
Michael.
-: Hi, thanks Llela and Haga the next slide please.
So hello everyone, I'm Michael Minkus,
I'm a Policy Advisor
in the Public Utilities Commission Communications Division
and as Llela noted, I will be moderating this panel.
I'll introduce the three panelists and share some
of their backgrounds.
Each panelist will get a chance to make
some relatively brief introductory remarks or response
to a question and then we'll take more general questions.
One panelist, Blair Levin will be joining us
about 30 minutes late and may make some remarks
when he joins.
So with that, can we get the next slide please?
Joanne Hovis is President of, and one more slide please,
President of CTC Technology & Energy,
she's a nationally recognized expert on broadband markets
and the evolving role of public-private partnerships
in 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 Us Ignite.
He brings a background in telecommunications from years
in the industry most recently as the co-founder
of DigitalBridge Communications
a venture-backed startups dedicated
to bringing 4G broadband wireless service
to underserved portion of the US.
Previously, Bill was co founder and CEO
of OnePoint Communication
which was purchased by Verizon Communications in 2000.
OnePoint and its successor company Verizon Avenue provided,
excuse me, provide bundled communication services
to concentrated communities nationwide
including apartment communities,
military bases and rural areas.
Next slide, please.
And one more please.
Yes, let's go back one, I'll introduce Blair Levin
so that we don't need to go over when he joins.
So Blair Levin as an attorney
and currently a nonresident fellow
at the Metropolitan Policy Program
at the Brookings Institution.
He also serves as 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 2009 to 2010, after eight years
as an analyst at Legg Mason and Stifel Nicolaus.
Before that, Blair was chief of staff
to FCC Chair Reed Hundt from 1993 to 97,
where his work included overseeing implementation
of the 1996 Telecommunications Reform Act
and the first spectrum of options.
So with that next slide, please.
I'm going to read through the questions from panel one
and those one background slide also and then lead
to the panelists to share some remarks.
So two questions both related to ensuring the merged company
can serve all communities.
The Frontier application discusses a virtual separation
of assets into Invesco ... -: Michel.
-: Yeah.
-: Sorry to interrupt, we're having a fire alarm go off
right now in the auditorium in San Francisco,
can you please stand by.
-: Standing by.
-: 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.
-: Okay, thanks.
Keep us posted.
-: If there's a safe way Joe for you to transfer your ...
-: This is the conference operator,
the conference has now convened.
-: Okay, thank you everybody, we're ready to start.
Michael, please continue.
-: Absolutely so I was going to go briefly.
So sorry everyone for the interruption,
I'm gonna go briefly through the two high level questions
that the panelists will speak to and then Blair Levin
the third panelists will join us in about 10 minutes.
The questions are one, do you have creative
thoughts about how to ensure high quality continuity
of service in ImproveCo areas that may include rural,
tribal and low income areas?
Question two is, what mechanisms such
as high cost funds support, capital costs 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.
-: 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.
We were at 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 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
to that some of these would be in the control of a Frontier,
others would be in the control
of different state level entities.
The first thing would be pole access,
utility pole access with certainty guarantees regarding
the opportunity to overlash 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 costs 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, in a perfect world we
wanna see state broadband funding stream structure
to support and enable community and tribe involvement
and 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 a critical
that they have the same opportunity to compete
for public funding than 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 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 an enabled tapping into substantial federal dollars
by enabling endless matching mechanism.
Third, public private collaboration should be eligible
for state funds so public applicant such as a county
or a town or a tribe wouldn't have to commit
to 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
of the infrastructure who will maintain
and upgrade the infrastructure.
Fourth, we wanna see a very reasonable phase 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'll critical for Frontier
to have data sharing obligations
at the most granular level possible,
ideally the address level, when there's any consideration
of this 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 it deserves a little very brief
and could each stand up 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, as I see, it would be some 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.
-: Thank you and greatly appreciated.
Bill if you'd like to take a few minutes
to speak to those same two questions.
-: Sure, I agree wholeheartedly with what Joanne
had to say and we've just finished a study at US Ignite
that looks at alternative models for deploying broadband
and creative ways.
There are five models, it looks at taking a part
of network into its five components, you know,
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 1000
what we call municipally enabled models.
One extreme is the full municipal model,
one of the other stream 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 been 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, company called Ting providing
the operating infrastructure and providing the servicing
and last mile activities.
A third model is a hybrid ownership model
which has been deployed in Lincoln, Nebraska,
where the community or tribe does the rights of way,
of course, owns the middle mile but then brings
in increased service providers to provide the last mile,
operate the infrastructure and service the customer.
Yet a fourth model which we're seeing in Washington,
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,
puts in the last mile, operation infrastructure
it has and 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 Joanne said, are potentially expensive,
potentially complex but 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 risks.
So it's a model that I think could help some
of these communities mix and match their own assets
or the municipal assets, tribal assets,
with some private assets to pursue creative models
to make sure it ensure levels are increased in these areas.
This is something that I also agree with Joanne in terms
of tapping in the state funding,
I'm not as close to the specifics
of the state funding models I think as Joanne 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 the networks should go
but also how some of these high cost funds could be applied,
the lifeline funds could be applied and more optimize use
of these local funds both federal and state and local.
So I guess Michael, to summarize my view in 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,
the more likely to be able to tap into and I think
there are playbooks perhaps that communities
can 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 Policy Programs.
-: Thanks, that's greatly appreciated.
So there'll be a chance for questions in a little bit.
Joe if we could go to the next slide.
I think we'll actually wanna go two slides ahead.
And Blair so this is a link to the US Ignite report.
Blair Levin has joined us, and we'll do one more slide,
sorry Joe.
And we have another series of questions and these relate
to the practicalities in a transfer or merger proceeding,
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.
Blair I think you're muted, we can't hear you at the moment.
-: Is that on my end or your end.
-: Now you're coming through loud and clear.
-: Okay great, hank 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,
you know, here's the rule book,
you're violating the code and 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 cropped
or they get mitigated because the incentives
to promise anything in the context
of a legal proceeding like a merger
or bankruptcy proceeding, that's 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 extensively re-litigate those issues.
And so I think aligning the incentives the right way,
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 built 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, you know, 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's coming out
of bankruptcy and so the economics where one
can be optimistic about it are nonetheless tricky,
whether that 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 and can be met.
The other thing is the process of enforcement
and I would simply say,
I think this is one where what you wanna 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 match
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.
-: Thanks, that's helpful and appreciated.
Joanne or Bill would you like to speak
to any of these topics now?
-: Go ahead Joanne, go ahead.
-: Bill, you first.
-: I was just saying, considering offer, I think Joanne
and I were in terms of local community involvement,
I think and also during Dore Bietz
from Tuolumne band earlier today,
this is maybe something has never been done but forcing
in the case of ImproveCo forcing requirement
or enforcement that there'll be a community participant
in a planning process to decide
how they're gonna 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 then take part
of the Rural Digital Opportunity Fund option.
I think having some requirements
that there is local participation particularly
in an ImproveCo would go a long way.
-: And let me echo that by saying I completely agree.
As I look around the country,
particularly at state funding programs,
the ones that incorporate an even mandates 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
with the FCC.
There are 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 it looks odd just as someone who works
with communities and states all the time,
that's 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
and rural areas and that doesn't just mean
that fiber going through then
is an interconnection obligation in San Francisco.
It means that there's an interconnection obligation
in that rural community where that fiber passes
and 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 spent a lot of time observing
in terms of rural upgrade patterns
and then the various ways that the funding streams flow
is that there's the way this mechanisms are set up,
the incentives are for incremental spending
not for large significant investment upfront,
do it once, do it right, you've got fiber instead.
We have ongoing incremental, costly spending
that in the medium term, not even the long-term
but in the medium term it 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
and 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 wanna 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 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.
-: Great and thank you, I have some follow up
but I will save those for a moment
and goes into question and answer portion.
So I know we had some little bit of an excitement
there when we were offline for a moment
but I was planning 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 Guzman Aceves
or other Commissioners, do you have any follow up questions?
-: Thank you and thanks again for the panelists
for their patience on another 2020 lively event
is keeping us going and I'm glad
it was just a false alarm there.
Actually, you know, some of this was you were starting
to answer Joanne towards the end here.
In a question I have, I think you you've all laid out
some great visions about the options and opportunities,
I'd like the term publicly enabled,
you might say that, right?
And all the options that exist and again it's 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 two 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, you know, how we functionally do some of this,
create these opportunities better.
I 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.
-: Maybe Joanne can you speak to that first
and then Blair and Bill?
-: Okay, yes, thank you, Commissioner.
So, 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.
As, you know, with the hope that enforcement
can be vigorous, we'd 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 the 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 incentives 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 devices as nation grow.
In coming years, we are not narrowing the divide,
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.
-: And Blair to you and Commissioner Aceves you
can paraphrase the question again as a refresher.
-: Okay, well, I wasn't sure look like Bill
was not ready to go on it, no?
Okay.
-: I generally agree with what you said and I think that,
that point about if you take an area
and you say we're gonna now serve 60% of it,
the remaining 40% actually becomes more difficult
to serve is a really important point,
I would also just note and I've got a bunch of writing
in bookings about this.
As we see things like 5G rollout in the wealthier areas,
as we see things like fiber rollout
and these are good developments but they're gonna roll out
in the wealthier areas, they're gonna lower the price
of the high end product in those areas
but in the lower income areas,
you're gonna have fewer choices,
the quality we brought,
and you actually will ironically get a situation
where the prices may be higher
because of 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&T.
With a monopoly, you 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,
I don't mean that in a kind of a negative way,
I'm just saying the law of economics means
that new competitive companies are gonna go
to the areas where they can get the greater return
and public policy so I understand that.
I would just add to what Joanne said in that light,
that now again, you have like larger build out obligations,
service quality obligations,
I think it's really important that the company agreed
to some kind of low price entry level product
for low income persons.
There 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 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 Joanne and Bill are welcome to join in.
If you price optimize or for purposes of return
on investment, you want pricing do 100%,
you really are pricing to about 70,
80% 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 your 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, I think if we look
at Comcast Internet Essentials I would argue
that in some ways it's even more successful
than the FCC 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 the 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 gonna be true for telehealth,
one of the most interesting things that come out of COVID
is we've gone from approximately less than 1%,
the visits to medical professionals being
over communications networks to now somewhere between 20
and 30% and that number is gonna keep going up.
So 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 gonna be cut off
from a lot of what medicine in the next five
to 10 years will be doing.
Another one that 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 wanna train for a job, search for job,
apply for a job, you're doing it online.
And in deed, there's research to suggest that people who
are online get jobs faster
because of that they've had that ability to train,
search and apply much more readily
so from a system perspective, we want everyone
to stay on line.
So those are the kinds of things that are that I
would be looking to make public obligations.
There are some cost to the companies but I think
those are reasonable requests to make sure
that particularly in areas where there
is very limited competition.
-: Yeah, Blair I would agree, I would just add that,
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 we're a holistic plan but also with a focus
on funding sources whether it's federal or state,
agreed to between ImproveCo locally and the local community.
Again, very much like what Ms. Bietz said the Tuolumne band,
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 Essential
is 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 podcast for being ones.
These may be a simple playbook coming out of this plan
that would help the community
and the existing provider work deciding what parts
can be politically parts can be private
and then how to make it happen.
Thanks for the question.
-: Thanks so much Bill.
I don't see other Commissioners on, do you have,
at at least Commissioner Shiroma.
Are there questions from other Commissioners?
Commissioner Shiroma.
-: Thank you, thank you to the panel.
Well, let me start with, let's advice with again,
in terms of, we have a company that's in Chapter 11,
that purchased sizable assets from Verizon a few years ago,
half 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 I am the assigned Commissioner now
on Lifeline and how do we,
as I think Matt said in the last panel,
any advice on navigating that while also looking
to lift customers who are on Lifeline because, you know,
there's been the structure of reality
that customers get dragged to the cheapest stuff,
the lowest customer service, the least amount of bandwidth
and it doesn't happen on the energy side of things.
The energy side of things,
electricity is electricity and a discount
or the care customers on electricity,
it's not on a lesser grade, what's on to the house so forth.
So kind of a big ticket question but really from in terms
of you all being the sort panel,
any advice to throw our way
on that as we navigate the bankruptcy?
-: I don't know if any panelist has an immediate response
but I'll prefer to alphabetical order by first name,
Blair if you have anything.
-: Thank you.
Look, I'm gonna 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 gonna 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 when we 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,
people whom traveling to visit a doctor
is very arduous being able to take advantage
of telehealth to be able to monitor their health.
Again, unemployed people doing job training,
those are things for which lifelines can 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
as most people choose our mobile voice with kind
of limited data but they'll use their money that way,
totally understandable.
In terms of staying connected all the time,
there lots of safety and security reasons,
if you're driving in a car you
wanna be able to do that, et cetera.
-: Blair, sorry, maybe you are not aware but again,
today's Wednesday, tomorrow I would love
to get a vote on a proposed decision
that judging issues which includes a free
and low cost broadband option Lifeline
and to be subsidized by our lifeline budget,
this is brand new and again, I think you and the fact
that there have been broadband offerings,
bundle offerings provided by US companies
in some of this rural areas.
Our last one subsidy has been for the voice
but we are proposing for the first time
to include databases.
Companies can get a subsidy from us,
proposed not put it out yet,
get a free offer and a low cost option.
So earlier on our Governor issued an executive order
on broadband for all
and my colleague conditions Commissioners
and myself are just adding up
the order instituting rulemaking on broadband for all.
So there's a long journey, that's for sure.
Are you all right?
-: Yeah.
-: Once there was a survey so everyone
has purchased phone and you know, when I was born,
my parents did not have a phone.
We're farm worker family, we were living
in a converted barn, no indoor plumbing
and the landlord crossed away at the phone and you know,
it's hard to even imagine days like those.
If I cut you off but I think what yo were saying is ...
-: No no, Commissioner that's great.
Is that gonna be in blue or does the individual
have a choice between the mobile voice
and the in home broadband or do they get both?
-: I have one interjection,
if we can try and steer things as much as possible
to the the proceeding at hand especially
with the vote pending tomorrow.
-: Thank you Michael, I really am not able
to talk any further above.
I just wanted to update you on what we're doing.
But we're talking about the Frontier of bankruptcy,
I guess no further question.
From a policy perspective , what principles we look
at to have in place in this bankruptcy proceeding
to ensure that, you know, we're upward trend,
not a downward trend and the outer bankruptcy
on the quality of service for a while I can.
-: I'll go back to Blair on the other panelists
but Allison Ellis, I believe you had some input?
-: Well, yes, I do feel it's important to say that,
you know, a lot of the discussion today
has centered around the need for broadband
in rural areas and trying to bridge the digital divide
and we agree that rural broadband is needed.
You know, we have been a big part of this 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, you know, broadband is not a regulated service
and when Frontier makes deployment,
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 I want
to emphasize that at the time of the 2016 transaction,
we voluntarily agreed
to significantly 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 CASF programs to deploy
both broadband in this tribal communities and,
you know, reach more than 15,000 households.
So I just wanna keep insight that, you know,
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, you know,
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, you know,
significant interest obligations on an annual basis
and that would potentially mean that, you know,
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,
you know, 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.
-: Thank you for that,
coming back to the panelists in question.
So I will paraphrase the question,
then go back to Blair and if Joanne or Bill you
had any point in present 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 and other parts of the service territory.
So with that, did you have for the follow up
on your remarks at all Blair?
-: I would simply say, again, you know,
there's a relationship between all of these things
and what the California PUC is thinking about
in terms of in home broadband,
I surely congratulate you for understanding
that the current Lifeline program
is from the federal level didn't solve a lot
of the problems to create those kind of public goods
that we really look the communications networks to do.
So I would argue that part of the conditions
should include a low cost offering.
I don't appreciate the point that Allison
is making about that 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 what 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,
I think it helps deliver those kinds of like I said,
public positive externalities.
But that that's a debatable point, I guess.
-: Well, sorry Michael if I can just...
-: I guess we can go to the other Panelists.
-: I just did wanna jump in on that because, you know,
Blair was not at the earlier panel
and so I just wanna 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 fundamental 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 bars so they don't
have to go through that laborious Lifeline qualification
process which, you know, frankly I find it difficult
to make sure all of the questions are answered correctly
and, you know, the correct documentation is provided.
So, you know, on the Frontier fundamental front
where customers qualify for ...
-: 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 wanna 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 because you could just ...
-: I understand.
-: Okay, thank you.
Michael please continue.
-: With that, Joanne or Bill did you have any input
on this question of making sure that all customers
are well served?
I think you're muted.
-: 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,
you know, 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 and an income level 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
so and other kinds of demographics
but that will be an issue and it is something
that is concerned 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.
Even if it's five times that much,
it's still not what any of us would consider sufficient
to call broadband where 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 do 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 or business class customer,
you might see different kinds of treatments
that you're buying different products.
For the consumer level, though,
It's not gonna 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 5G world and a fiber upgrade world,
we are going to a significantly greater a digital divide
than we have been in the past.
-: Thanks and Bill.
Any Yeah,
-: I would just add that Allison 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 the guts of those plans
really helps them to communicate to their citizens
how to apply.
Sometimes it's tricky, I would just urge the Commission
and Frontier to keep pushing those plans particularly
if they sound like they're very equivalent
to other customers in terms of speed
which is wonderful but there's often a gap
in knowledge about how to apply
and I would just encourage you to keep it up.
-: Well, thank you and we do partner
with the California Emerging Technology Fund
and they have been really instrumental in helping
to bring that information to low income consumers.
-: 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 Llela
after that we will take any email question.
-: I'm sorry, no questions on the phone lines at this time.
-: Thank you, Llela any email questions?
-: Right, so we are expecting to receive 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 were informed
that there will be two callers that will be calling
in shortly so operator.
-: Great, I'll come back.
-: Thank you.
-: And with that Commissioner Guzman Aceves
or Commissioner Shiroma 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 Commissioners.
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, you know, not to put you on the spot but can you
to speak to any examples, either in terms of the process,
what worked or a actual program where
that was particularly successful and might be duplicable
or be able to be duplicated in California?
-: Yeah, I'd be happy to and I'll 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 or they're relatively new grant program
for rural broadband expansion.
The grants are primarily going to benefit
from entities who are building and operate primarily fiber
with them but the grants are not awarded
to local government in our case in Maryland counties
that are the dominant government unit particularly
on the rural side.
But unless that county government
is a clear partner strongly in support
and deeply integrated into the funding,
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 has limited interest,
even if they might have nearby at them
are simply disadvantaged by that unless
they make a whole lot more effort to get
to know the local community.
That example has resulted in very successful
because of this relatively
non controversial federal example,
recently with USDA grant program
is required substantial showings of support
from public entities.
It makes grants to public entities
but they're much fewer than the grants to private ISPs.
But the grants to those ISPs are the applications
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
and I think it 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.
-: Thank you and I don't wanna bar other panelists
from responding but I believe Commissioner Shiroma did you
have a further question?
-: Yes, when we navigated the PG&E bankruptcy,
we and the Governors but we substantially focused
on the makeup of the board of directors
and the governing board and looking for diversity
and now that we have moved
on from diversity of viewpoints.
And also, we ended up with a 20% of the California
assessment in looking at a new Frontier coming out
of the top level of the policymakers.
If you don't have a sense of that, you know, that's okay.
-: I mean, I think Commissioner I would say that,
to the extent, you can ask our board members
to be consistent in talking to them the community approach
to planning and applying for some of these grant programs
to meet the needs of local communities, again,
focused on improving, that would be great, you know,
my experience is having a diverse and a lot
of companies affiliated with this company
and it's good for the citizens getting grumpy.
-: And Blair so anything to add and if not,
I will go back to the phone line to see
if we have callers now.
-: I would just say, you know,
there have been various proposals by folks
that have given kinds of representations
on boards of directors.
I don't wanna weigh in on that but I would note
that other countries do make that requirements.
In this particular case, if there has to be public
which 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
and 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.
-: Thanks panelist.
And Llela can we check to see
if are there any questions on the phone line?
-: I'm sorry, no questions on the phone lines at this time.
-: Okay, thanks operator.
So with that Commissioner Guzman Aceves
any follow up questions?
-: 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, you know, potentially accessed
and 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, you know, some sort of quarterly update
for communities that are still looking to get broadband,
to have access to how they can best partner with Frontier
and this is kind of a very tangible idea that you guys
have presented in terms of having that access,
other examples like that?
The infrastructure or even, you know,
there's a lot of 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 proceeding, Lifeline or our broadband program
or public purpose programs.
But just in relation to kind of actualizing,
putting the pieces together with this, you know,
this application before us is that,
and by the way we've done a similar thing
as Commissioner Shiroma mentioned on the electricity side
where we have a new portal for local government
to be able to access where, you know,
this key distribution infrastructure is,
key points of communication.
There's a now a local government interface
that includes a live portal where people
can update everything where substations being upgraded,
whether it's putting up back up generations.
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,
you know, the level of progress that could be made simply
by a deeper access as you say, generally to the data
so what could it look like?
Could it look like that, you know, local government portal
as we've done on the electricity side or, you know,
is it this planning process that they're obviously gonna go
through to define their Invesco areas?
Any thoughts on that.
-: 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.
-: 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 of office
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 more expansive federal funding
will help to change that,
as well public-Private collaboration, merging with that.
New information is always good, more information is good,
availability of 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 wire line networks.
But at the same time, I wanna 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 a word or a lever
for unlocking new opportunity.
That takes capital access to, you know,
access all of that and in 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 designed to be really useful,
they move us in the right direction but the the movement
is relatively modest relative to the distance we
have to travel.
-: Thanks Joanne and Blair?
-: I basically just I agree with Joanne
and don't have anything to add other than the follow up
on her point about future federal funding,
I would just note that the House Democrats
have already passed 100 billion dollar broadband package
as part of a broader infrastructure package
and even Republicans like Jeb Bush the other day came out
in favor of $100 billion broadband package.
So I think there is 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?
-: 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 I understood using the same potential
even more frequently than quarterly to sort
of see if there's smoke at some point.
-: Right, well it's really what the company is planning
on doing a variety of things.
Companies are constantly reevaluating their plans
to the extent that they are not getting the benchmarks
that will enable them to meet the commitments based
and in terms of the California PUC coming out of bankruptcy,
the earlier you know, the better the options
are for dealing with it.
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.
-: Right, thanks.
And Commissioner Shiroma.
-: Yes, I just wanted to thank everyone,
I need to exit to go to another meeting but thank you
to all of panelists for an interesting conversation.
Thank you Commissioner Guzman Aceves
for hosting this workshop and all best wishes
for the patient part of this evening and hopefully,
you know, a good number of folks to call
in to take advantage of providing a public comment.
So thank you very much.
-: Thank you.
-: Thank you Commissioner Shiroma.
-: And with that, Llela could you go to the email question?
And and operator, we could check the phone queue after that.
-: Absolutely, thank you Michael.
So we have a common question from 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.
-: Wasn't that to the panelists?
Do you have 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 the Frontier transfer
or today from Frontier pre and post bankruptcy.
-: I would just reiterate what I think we've said a couple
of times is that a commitment to work
with the community develop a plan to bring broad
to the spots in the community
that don't have it and a comprehensive plan
that tells you how the community is going
to have to do that in partnership with Frontier
or ImproveCo would be essential and I think
that could make a big difference.
-: 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 of 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 in 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.
-: I would just add, it really depends on the.
Can you hear me?
-: Yeah, sorry, go ahead.
-: It really just depends on the enforcement mechanisms.
I mean, it could be that if there are agreements made and,
you know, there should be some enforcement mechanism.
Fines are problematic in the sense
because you're actually taking money away
from what you want which is more cutbacks but you could,
for example, say that, you know,
dividend payments or other kinds of payments
to various financial stakeholders couldn't be made
until the build up is complete or whatever.
I mean those are complicated things
but there has to be some kind of priority and incentives
to actually do what they say they're gonna do.
-: Thank you and I understand operator there is a caller
with a question on the line.
-: I'm showing no callers with questions at this time.
-: All right, let me just check with Llela.
Am I mistaken there?
-: Hi, yes, 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 over leveraging at the time Frontier took
over the Verizon asset at issue,
why was this approved if such high depth 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 10s of thousands of children
without high speed internet in their 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 I needed to be transmitted
to the communities to which they are intended
to serve and language connection as necessary.
Local municipalities should be given right
of first refusal to take over the Frontier assets
and ground currently within a region.
Number five, the 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.
-: Thanks Llela, 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 have further thoughts about mechanisms
from more or less enforcement,
I know Blair talked about it earlier and just touched
on how fines can be limited and particularly
the question about over leveraging and the high debt load
and if other states or the California might consider looking
at that, looking at that level of details as transaction
or whether that's proved and problematic
in other states or instances.
So enforcement mechanisms and whether to look
at debt-to-equity ratios and that detail of finances.
So with that maybe Bill, if I could start with you?
-: I'm not sure I have anything else to add
from what we said already.
I mean, it's hard to disagree
with having the appropriate debt load but the right can ...
-: Well, with that let me go to Blair Levin as the, maybe,
the most experience with these considerations.
-: Yeah, the and always the purpose
of the bankruptcy proceeding is for an expert's,
a bankruptcy judge to determine what
is an appropriate debt load.
But you know, having said that,
there are lots of uncertainties,
you can have an appropriate debt load in January of 2020
and then discover that because of changes in the economy
in April that you were way over levered.
Although there are certainly a lot of situations
where people are under levered.
So I think that's a difficult thing,
I'm not sure the California PUC has,
that's where it's 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, you know,
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 sense that the person disagrees
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 it 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.
-: So thanks for that.
I will 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 Bill do you have any closing thoughts?
-: Yeah, thank you.
-: Thank you for the opportunity to help out, thank you.
-: Thanks very much.
-: With that, Llela the mic is yours.
-: Thank you.
Okay, my recorded voice is not good but we
will be taking a break and we will continue at 3:20,
we will see you shortly.
-: Thanks Michael.
-: Thank you.
-: Thank you very much Michael and good
to see you all bye bye.
-: Likewise.
-: Good to see you Blair and see you Joanne.
-: Testing one, two.
-: They are robotic.
-: Testing one, two.
Check, check.
-: That sounds good.
-: 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 The Utility Reform Network
through Christine Mailloux and we will then hear
from the Public Advocates Office through Christina Donnelly
and then we will have Communications Workers
of America Rachael Koss.
Christine, would you like to start please?
-: Yes, thank you.
Good afternoon, my name is Christine Mailloux
a Telecommunications Staff Attorney and Managing Director
of the San Diego office of the Utility Reform Network.
We're a statewide consumer advocacy organization
representing ratepayers 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 TURNs approach
and goals in this docket and then I'll turn it over
to the other intervenors to do the same.
The importance of this docket cannot be overstated
and to meet the Commission statutory duty,
the review of this application cannot be an area
of focus as suggested by Frontier this morning.
The docket is not but it's important to note
that the docket is not about blocking Frontiers emergence
from bankruptcy, they are already in bankruptcy
and it's nobody's best interest that they do not emerge
from bankruptcy.
But we must make sure that the decision 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 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 billion dollar shuffling might be happening
at the top in a manner that will ensure the company
can emerge from bankruptcy, we have no doubt about
that 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.
TURN has focused its efforts in this docket
on understanding the 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 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 creditor's gonna 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 most 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 have 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 they are 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 build out issue
is too intense right now to suggest that just looking
at what's happening in 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 intervener conditions.
Our conditions mostly address the fact
that the Frontier application and 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 from 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.
And 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,
Invesco and ImproveCo kinds of decisions that TURN
and our expert witnesses are looking at very closely.
With that, you will hear from other intervenors now
at this point that have punched 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 the circuit
and Senior Policy Analyst for the Public Advocate's Office
and the Communications and Water Policy Branch, Christina.
-: Thank you, Christine.
Can everybody hear me?
-: Yes, we can.
-: Great.
Thank you for having me today,
as Christine Mailloux said my name is Christina Donnelly
and I'm an analyst with the Public Advocate's Office.
The other members of my team that are working
on this proceeding are in attendance as well
and that includes Cameron Reed, Vichy and Tony Kelly.
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 an advocate
on behalf of residential and small business customers
in California to ensure safe,
reliable and affordable service.
Our team has reviewed Frontiers application
and we submitted our recommendation to the Commission
in the form of testimony on September 30th.
Our detailed review includes an examination
of the impacts on Frontiers investments and 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 the debt and interest savings resulting
from the restructuring will enhance
the company's corporate and operational stability
and alleges that the savings will enable
the company's California operations to improve
and enhance the services the subsidiaries provide.
The Californians cannot take Frontiers 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 was find the transaction will be in the public interest.
This is a requirement under PU Code Section 854
which the scoping memo in this proceeding
has already ruled applies in assessing
whether Frontiers application is in the public interest.
Therefore, the Commission should impose
on Frontier specific conditions that are necessary
to ensure that 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
for 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.
So three things 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 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 services,
backup power requirements and to measure the level
of customer satisfaction within Frontier service territory.
And again, this is just a summary of our recommendations
and our full list is included in our testimony.
Frontiers 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-19 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 panelists for participating
in today's workshop and we look forward
to sharing any additional comments during
the upcoming public participation hearing
and public comment period following our comments,
so thank you.
-: Thank you for that.
Is Rachael Koss. available?
-: Yes, good afternoon everybody,
I'm still trying to access the WebEx I apologize,
technical difficulties, it's not allowing my password.
Wait, I think it is now.
Okay, here we go, you might see my face in a minute.
Hang on.
Am I appearing?
-: You should be able to enable your camera right now.
-: Okay, apologies.
Good afternoon everybody.
Thank you so much Commissioner Martha Guzman Aceves
for holding this workshop and thank you staff very much.
My name is Rachael Koss,
I'm here on behalf of communications Workers
of America District Nine.
District nine 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 first hand knowledge of the condition
of Frontier 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 Frontiers presentation at this workshop
and from Frontiers formal claim 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 Frontiers proposed restructuring
on customers on safety on employees.
Frontier has not adequately maintained
its physical copper plants
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, this system is just not safe for workers
or the public.
Notably since acquiring Verizon assets in 2016,
despite the much needed work to improve the system,
the size of Frontiers 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 Nine.
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 Frontiers 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 a 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,
Frontiers 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 Aceves
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.
Frontiers application
and it's pursuit in this proceeding lacks the details
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 Frontiers restructuring
will negatively impact customers
and will negatively impact employees and District Nine ask
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, the 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.
-: 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 the public comment segment
of this workshop event at this time I would like
to turn this over to ALJ. Rosinski to lead us
through the remaining part of this event,
ALJ are you available?
-: Llela, this is Patrick Rosvall,
I just wanted to ask a question that I posed
on the chat function, we would just like
to understand whether what's just been said was transcribed
and if so we'd like to be able to respond on the record,
if not then 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 you could?
-: Yes, thank you Patrick.
The segment earlier was not transcribed.
The transcription will begin
when the ALJ begins his portion.
-: All right and are we to understand that the parties
are not to be commenting during this segment,
that's what I think I understand but I just wanna make sure.
-: Yes, we the ALJ will clarify the steps
for the next segment, thank you.
-: Great, thank you.
-: ALJ. Rosinski, are you ready?
-: All right, can you can you hear me Ms. Tan-Walsh?
-: Yes, we can.
-: Very good.
Court reporter, are you ready to begin?
-: I am ready, your Honor.
-: Very good.
We are on the record,
the California Public Utilities Commission
will come to order.
It is now 3:42 p.m. on October 7th, 2020, good afternoon.
This is a time in place for the public to comment
at the end of the public workshop and application 20-05-010,
the application of Frontier Communications Corporation
and its affiliates for approval
of a corporate restructuring.
My name is Peter Rosinski
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.
-: Thank you Judge Rosinski and thank you to the public who
has held on so long, I'm looking forward to your comments.
I know that there's been a couple of folks who
have requested to be seen on the WebEx,
if that's something we can accommodate I
certainly would be supportive of that but I leave
that to you and the folks, Joe and Robert, thank you.
-: Very good, I have no problem
with that if it's technically feasible so 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 upon one telephone number 800-857-1917
and then press access code 7218384.
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're 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 one.
A chime will sound after three minutes to indicate
that the speaker's time is over and as I said,
this segment is dedicated to comments from the public.
You're now ready to begin with transcribed public comments.
Operator if you could please announce the first speaker.
-: Thank you, the public comment line is now open.
Our first speaker will be Steven Walters, please go ahead.
-: Good afternoon, it's Susan Walters and my name is Susan,
S-u-s-a-n, Walters, 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.
The ETF 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 327,000 underserved households and businesses
and new broadband access for 107,000 unserved households,
as well as affordable broadband offers and distribution
of 50,000 tablets to low income households,
as well as an increase of 200,000 low income households
on loan at home.
So in light of this positive settlement,
that is the type that I think Blair Levin
and others mentioned earlier this Commission approved,
these public benefits are important to continue and CETF
is concerned about the financial viability of Frontier.
At this time, especially doing it health emergency,
it's critical for all customers or consumers really,
to have broadband and CETF supports the need for Frontier
to move forward in a healthy financial state
but also for the PUC 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 oppose
an interest in innovative solutions but all companies
or almost all companies have opposed
those or challenged CAF applications
in their service areas because AB-1665.
The Commission will have a chance in new legislation
to oppose those kinds of measures going forward.
-: All right, very good.
Thank you Ms. Walters for your comments.
Operator, if you could please announce the next speaker.
-: Our next speaker is Ronald Rauhecker your line
is now open.
-: Yes, this is Ronald Rauhecker, last name spelling
is R-a-u-h-e-c-k-e-r from Novato, California.
We need ethics in it's call office
but Frontier pools every time they make a billing app,
they try to add extra items on there, like road repair,
and calls you didn't make and this happens in every bill
and we need to stop it.
When you try to find out who their aging 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 him
to small claims court and I've been unable to reach
the address processing agent.
We need to have that furnished to every recipient
of Frontier customers.
We are totally upset,
Frontier should at least pay a $10 million bond put aside
to make sure that they make these promises come true.
We've had so many outages and stuff like that,
that it's unrealistic anymore.
Every excuse you get, it doesn't come true,
they just just lie like hell.
There needs to be a separate precedents put out
so something like this does not have ever happened again.
I'm 80 years old and I've never done companies like this,
their ethics is.
Thank you for hearing me.
-: Thank you Mr. Rauhecker for your comments.
Operator, if you could please announce
the next speaker please.
-: Your Honor, there are no more speakers
on the public comment telephone line.
-: 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
to now 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 7218384 then press star one
and you'll be placed in line.
So I will wait a minute and see
if there are any other callers.
Operator, if you do get some callers,
please go ahead and announce them.
-: We do have another caller.
Margaret Grahame, please go ahead.
-: Thank you, my name is Margaret Grahame
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 a 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 Goss both said
about living in a rural neighborhood but I also wanna 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
that 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 recognized.
-: Very good, Ms. Grahame you finished with your comments.
-: 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 One which has fiber available to it.
It is installed in there and yet we cannot get access
to it because the Frontier.
Thank you very much for the opportunity to speak.
-: Thank you, Ms. Grahame.
Operator, do you have any other speakers on the line?
-: Your Honor, I'm showing no other speakers
on the telephone line.
-: All right, I will wait a minute and I will check back
with the operator and see if anyone else has called in,
again operator if someone calls in please go ahead
and announce them.
All right, operator is there anyone else that's called in?
-: No sir I am showing up further callers.
-: Very good, we are going to wait,
I'll wait another minute and check back with you operator.
I wanna give anyone who wishes
to comment a full opportunity to do so.
-: Judge Rosinski,
I know there was one particular caller from Volusia County,
I don't know if communications division has been able
to get her through.
I believe her name is Alena Anberg.
-: Okay, if anyone with communication division
can give us an update on on that potential caller,
that'd be great.
-: This is Llela, I'm checking if we
can get a Alena's phone number then maybe we
can just have the operator call her back.
-: Very good.
-: We do have a caller, Jury Hensley you may proceed.
-: 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 Frontiers 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 problems because we knew
that Verizon wiring et cetera was not basically up to code,
it was the old.
We expected that Frontier would take
the initiative and fix these issues
which 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.
-: Very good, thank you, Ms. Hensley for taking the time
to call in and comment.
Operator anyone else that has called in?
-: Yes, sir.
Next we have Michael Pierce.
Your line is now open, please proceed.
-: Hello Judge Rosinski, My name is Michael Pierce
and I'm on the staff of the PUCs 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 5:30
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 5:30 to 5:45 in case other people wanna call then.
-: Very good and I'll let you continue to want to,
because it appears that we are going
to have a separate public participation hearing session
that will start at 5:30 so that addresses your concern.
Do you have any other comment you'd like
to make this 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, has anyone else called in?
-: Yes, we do have.
Scott Farmer, your line is now open.
-: Thank you, my name is Scott Farmer on the Chair
of the Sonoma County Coast Municipal Advisory Council
and just briefly, on the Sonoma County coast area served
by Frontier experiences issues presented
by this panel through the day.
Frontier has marketed services to, 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 to far too few, I don't expect
to see any improvement in service standard soon.
The frustration is that Frontier claims to serve areas
which which they do so marginally or not at all.
The 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.
-: Thank you Mr. Farmer for your comment.
Operator is there anyone else that's called in?
Sorry, operator is there anyone else was called in.
-: No, sir, I am showing no further callers at this time.
-: Okay, all right.
We will wait a minute, I will check back
with the operators see if anyone else has called
in and we'll also follow up
with with Ms. Anberg who indicated that she wanted
to call in, let's see if we can connect with her.
Operator, do we have any other speakers in the line?
-: Your Honor, I am still showing no further speakers
on the line.
-: All right, we will wait and I will check back
with you operator.
Operator is there anyone else in the line to speak?
-: Sir, I am showing no further speakers at this time.
-: All right, we will continue to wait while we're doing
that CD Division I don't know if any one of you
have had an opportunity to see if we can connect
with Ms. Alena but please let me know
if there's anything new regarding attempt to contact her
to call in for this segment of the workshop.
-: Hi ALJ, we tried to reach out to the caller
but there was no response with from our calls.
-: Operator any anyone else that is called in?
-: Your Honor, I'm showing no further speakers at this time.
-: Okay, I do wanna give everyone the opportunity
to call in and I will wait again
and I'll check back one more time to see
whether if anyone has called in.
If any of the staff people are aware
of any possible connections that I should be aware
of to allow them to comment
in this segment please let me know.
-: Hello, this is Kundra Monish speaking I
have Alena Anberg on the line.
-: Very good.
-: Hi there, my name is Alena Anberg and I'm a teacher
in a rural Northern California county of Volusia.
I was working on the internet world divide
since March when of course as a teacher we went home
with students and needed the connectivity
but along the way I talked to each resident,
I went door knocking actually door to door
for each of our 1300 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 towards
the school district I realized people did
have service subscribe to service but did not have service
and that was Frontier service
and has been the monopoly provider here for over 30 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 rural communities who
are having these kinds of struggles
that there are solutions out
there and 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 worked
in a grassroots effort talking to all stakeholders
then talking to some writers as a stakeholder
and seeing what can happen.
We do have a provider so to answer one
of the Commissioners questions from this morning,
are there providers out there who are able to do this?
Yes, there are, we found one and 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.
So that's super exciting but the other reason I'm calling
is because I would not in under any circumstance
be having that conversation with Frontier.
It's been here for 30 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 have special needs students ...
-: Ms. Anberg, could I just interrupt you,
I apologize for interrupting you.
The court reporter would just ask
if you just speak a little bit more slowly,
she's taking down everything you're saying
so if you could just to slow down a little bit, thank you.
Please go ahead.
-: I am a little nervous folks.
So I've had 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 STS programming
from Frontier and was given the runaround,
a lot of hoop jumping so that their practices
are then prohibitive for these parents who do engage
those kind of lower income, low STS,
good pricey programs here, such as getting a password
for a portal, emailing, voicemail 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 subscribe to Frontier service
and then found out about the low STS 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 is really slow,
it is really bad, you would not want
that so she ended up saying with a higher rate plan
even though she qualified for the lower STS service
that was being offered.
There was an advocacy group that we work
with that called and heard about what the work I
was doing and said, 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,
it's a struggle with Frontier as our primary provider here
for 30 years, there has 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
into reports about where they absorbed $140 million
in Connect America to plans in California and even claim
to deploy addresses in my hometown of Arbuckle, California,
two streets that are super rural, such as wire,
road or own road which just are not the case.
As an example, the only site on on road is a cemetery
so unless people in there in the 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 creditor, you know,
even or getting back some money for the shareholders
which of course, I understand that but literally 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 and 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 the similar issues with their relationships
or projects or experiences with Frontier,
the woman who was representing the tribal people
and the gentleman.
I also agreed 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 went ahead and did fiber,
I mean Copper instead.
And there are fiber in some of these communities
usually in sometimes installed by a 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 install in their homes, I mean,
new home builders 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
be here reorganizing and they be held accountable ...
-: Can you hear me ma'am, this is the court reporter,
I'm sorry to put the brakes on.
Before you leave the line I need you just fill your name
and if you could slow down a bit,
that would be very helpful, thanks.
-: Yes, thank you.
So I would prefer that Frontier not only be allowed
to reorganize and continue in this manner
but also be held accountable for their actions thus far.
-: All right.
-: And that is what I have to say.
-: We're good, Ms. Anberg could you please spell your first
and last name for the court reporter?
-: A-l-e-n-a, A-n-b as in boy, e-r-g as in Georgia.
And I'm happy to answer questions
or the be available outside of this meeting.
-: Very good.
Thank you for your comments Ms. Anberg.
-: Thank you.
-: Operator, do you have any other callers on the line
or waiting to speak?
-: Your Honor, I'm showing no further callers at this time.
-: Okay, we are going to wait a minute
or so to see whether there are any other callers.
Operator anyone else who's called in?
-: No sir, I am showing no callers at this time.
-: All right, we are going to give one more opportunity
for any caller to call in.
Operator is anyone else called in?
-: Your Honor, I am showing no further callers at this time.
-: I'm gonna go ahead and make some closing statements.
If at any time before I finish
with those statements operator,
please interrupt me let me know if someone has called in,
I certainly want to give everyone opportunity
to make any comments that they wish.
I wanna thank you operator for your work that appears
to conclude all the speakers who have 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,
they submit written comments on a docket card
for this proceeding which can be found
on the Commission's website @cpuc.ca.gov.
If you need assistance with providing additional comments,
please contact the Commission's Public Advisors Office.
In addition, we will be conducting
a public participation hearing beginning at 5:30pm 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 star one
and you'll be placed in line to speak.
Before we end Commissioner Guzman Aceves
would you like to make any closing comments?
-: Thank you, Judge Rosinski.
No, I look forward to any additional public comments later
this evening and I really just wanna 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 staffs work in 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.
-: Good, thank you Commissioner Guzman Aceves.
Operator before I close this proceeding
has anyone else called in?
Operator, has anyone else called in?
-: Your Honor this is Robert Stanford,
no one else has called in at this time.
-: Okay, very good, thank you Robert.
That concludes this public workshop.
Thank you all for your participation
and we are off the record.