California Teleconnect Fund

Background

The California Teleconnect Fund (CTF) program provides discounted rates on advanced communications services for qualifying schools, libraries, government-owned health care providers, community-based organizations (CBOs) and community colleges in order to aid in reducing the digital divide. The CTF program was established by a 1996 CPUC Decision in response to Assembly Bill 3643 (PU Code 280). The California Teleconnect Fund provides a 50% discount on select advanced communications services including measured business service lines, T-1, and broadband internet access. The program is funded through a surcharge on the bills of customers who purchase intrastate telecommunications services. 

The California Teleconnect budget grew over the years, due in large part to the great need for more affordable broadband Internet access services throughout California: 

  • 2009-2010 = $ 60 million  
  • 2014-2015 = $108 million  
  • 2015-2016 = $148 million  

See more History. 

CPUC Rulemaking Program Review

In January 2013, the CPUC opened a Rulemaking to determine whether the California Teleconnect Fund (CTF) program is fulfilling its purpose and whether the current structure and administrative process are adequate to further the program's goals. 

In July 2015, the CPUC issued a Decision which restates the CTF's original program goals, as well as: 

  • Establishes new eligibility criteria for participants. 
  • Requires service providers to post on their websites pricing information for CTF-eligible products they provide.  
  • Retains the 50% discount structure for CTF-eligible services, except for voice products which were reduced to 25%. 

In a subsequent phase of the proceeding, the CPUC will examine program administration, results measurement, and implementation issues. 

ORA Policy Position 

ORA supports the goals of the California Teleconnect Fund (CTF) program of providing access to broadband Internet access services more accessible to underserved communities through the entities that receive discounted rates. However, CTF expenditures have been increasing rapidly. Refinements to the program are necessary to better ensure program goals are met cost-effectively. Program efforts should especially be focused on addressing the needs of underserved communities by providing them with tangible access and training in order to bridge the digital divide.  

The CPUC's July 2015 Decision, adopted many of ORA's key recommendations: 

  • Add pre-Kindergarten school programs to the list of eligible program participants, and base eligibility criteria for nonprofit private schools on Free Reduced Meal Program participation rates. 
  • Remove the funding cap on community college program participants and instead limit the amount of CTF support for administrative use. 
  • Add Critical Access Hospitals to the list of eligible healthcare entities, so long as they are non-profit or government-run. 
  • Continue the current 50% discounts. 

 

See ORA’s May 11, 2015 Opening Comments on the Proposed Decision. 

See ORA’s May 18, 2015  Reply Comments on the Proposed Decision. 

 

See ORA’s July 23, 2014 Alternative Proposal 

See ORA’s October 9, 2014 Comments on Phase I and Phase II issues.  

See ORA’s October 21, 2014 Reply Comments. 

Proceeding Status

See the Proceeding docket.  

Subscribe at the docket to receive proceeding updates. 
 

Other Resources  

Broadband Opportunity Council Report and Recommendations – August 20, 2015 

Data on State of the Internet 

CPUC CTF Webpage