Vermont Legislature SmartTranscripts:

[Unidentified committee member(s) (diarization aggregate)]: You are live.

[Rep. Kathleen James (Chair)]: Alright. Welcome back everybody to the House Energy and Digital Infrastructure Committee. We are going to walk through H11, a bill that was introduced last year that we took some testimony on. And so we're going to get a little refresher from legislative councils and talk in particular about a section of the bill that might or might not be relevant. We're not sure. That's why we're talking about it. To our testimony this week about consolidated communications, retirement of its legacy systems. So, Maria, are you oh, I'm representative Kathleen James from the Bennington 4 District.

[Unidentified committee member(s) (diarization aggregate)]: Scott Campbell from Saint Johnsbury. Richard Bailey, Lamoille two. Michael Southworth, Caledonia two. Christopher Howland, Rutland four. Dara Torre, Washington two.

[Rep. Bram Kleppner (Member)]: Bram Kleppner, Chittenden 13, Burlington.

[Rep. Laura Sibilia (Ranking Member)]: Laura Sibilia.

[Rep. Kathleen James (Chair)]: Okay. Whenever you're ready.

[Maria Royal (Legislative Counsel)]: I'm ready. Okay. Okay. Good afternoon, everybody. Maria Royal with by the Plated Council. Nice to see you again in this session. So, yeah, we're gonna talk about page 11, which we did review a little bit last year and need to take some testimony on it. Just kind of a general refresher, but at any point, if you wanna delve into details on any of these sections, please slow me down. Okay. And we can do that. I think it's actually the last section, section three of the bill that was just alluded to that might be relevant to your conversations and hearings about consolidated and notice Great. Transitions. So, that being said, and I'm noticing that my battery for some reason or my internet connection keeps shutting off. So if I might shut this might go off. Okay. But hopefully, it'll stay there. Yeah. Hopefully, it all works. But it's so the bill is on the committee's web page if you just search h 11. And also, under h 11, you can see there's a tab that has the witnesses if you wanted to see who spoke about the bill last session, what their written testimony was. Great. Very generally, section one of this bill creates a new subchapter in chapter 63 of title nine. Chapter 63 is known as the Vermont Consumer Protection Act. It has a number of provisions. It's a it's a general law. It applies to all businesses in the state. There are very specific statutory provisions that apply apply to specific industries like propane dealers, etcetera. And then there are full sub chapters within this chapter that apply to specific areas like lead removal, harmful toxic materials. Right? So this would be a whole new sub chapter specific to broadband. And so I'm just gonna read the purpose because that kinda gives you the overall purpose of the bill. So this is the purpose of the subchapter. The purpose of this subchapter is to promote a thriving broadband market in Vermont free of anti competitive, unfair, deceptive or misleading practices in order to protect the public and to encourage fair and honest competition. I won't go through all the findings unless you would like me to, but so part of what is discussed here has to do with the market in Vermont. As you know, there are rural areas where consumers don't have a lot of options in terms of their broadband connection. That's obviously changing. It's an evolving market. So, some of the provisions here are to study the market at all times and understand whether providers are using their market dominance to either prevent competition or take advantage of consumers who don't have a choice. So, that's one aspect of it. And then there are very specific things which we'll look at, you know, broadband providers shall not engage in these very specific unfair practices. So, one of the issues that came up also last year was who would be the right regulator enforcer of provisions like this? You've heard from the attorney general's office that kind of felt like they weren't so sure that they were the right entity. You also and I'm not gonna summarize everything that was said. Don't remember everything, but just to kinda give you some of the things that you heard. And you also heard that some of these practices, because the existing law applies generally to unfair business practices, some of the things that are specifically itemized here would likely or may fall under the existing laws. So there was a lot of discussion about what are the specific harms here that wouldn't be captured that would make, you know, justifies moving forward. So, so before I get to the itemized prohibited practices, I just wanted to mention there is a provision on net neutrality here. As you know, Vermont requires any provider that contracts with the state to abide by net neutrality provisions. And you did hear from the agency of administration last year. They are the ones who promulgated rule 3.5, which is the rule that applies to any procurement of goods and services on behalf of the state. So, there is now language in there that specifies if it's for Internet service, provider has to comply with net neutrality standards. So that's being enforced now. And what this would do is make all providers in the state have to comply with net neutrality. I don't know how many other states have done this. I know California was the big one because that's where there was a lot of litigation and ultimately the law was coveted and is being enforced currently. So, as I mentioned, this very specific unfair, deceptive acts or practices that are specific to broadband and identified here, failing to provide a consumer with service that meets or exceeds the characteristics offered and sold to the consumer's location. So basically, the marketing that they can't market something that they are not capable of providing. There was some I think both the department and maybe public knowledge talked about maybe refining this a little bit and making sure that, for example, if they provide customer premises equipment, that equipment has to be capable of meeting whatever that standard speed was sold to the consumer. So I think this is one of those sections that might need a little work. And please tell me if I'm going too slow. If it's too weedy for right now, maybe. I'm feeling like I'm getting a little bit You're okay. Okay. So, another unfair prohibited practice failing to reimburse a consumer for installation costs with any service that is discontinued or that did not meet or exceed the minimum performance characteristics that were sold to the location. Engaging in marketing or promotional practices that misrepresent the actual terms and conditions of the service plan or tend to mislead or deceive an actual or prospective consumer. Excessive termination fees, so if somebody, consumer does want to switch providers, they're not then hit with a large fee that makes it prohibitive, cost prohibitive. Submission five, charging equipment or service fees that do not reasonably correlate with the cost of the broadband service that's provided. And so this is getting at, you know, kind of the junk fees that might attach to a deal. So when you purchase a service and they tell you what how much the service costs and then there are additional fees that one might presume are already included in the cost of service that a company would be prohibited for doing that. That should all be folded into the cost of service so that consumers understand what they're contracting for. Six is just to make sure that Internet service providers accurately report their information about where they provide service so that the Department of Service has accurate maps of what locations are currently served. And then, obviously, if they violate their own privacy security or network management practices, that would be a violation. And then eight, imposing a predatory data cap or data cap as further defined. So, this was the issue. There was some conversation about this. Some providers sell plans that have data caps. And I think what you heard first from the department was it doesn't really make sense to have data caps at all. In other words, it's just a it's a way of charging more for different levels of service that has no impact on network management. Because a data cap doesn't restrict you time of day, so there's no way of knowing, you know, is there gonna be congestion? And that's why you're restricted. It has nothing to do with that. It's just the data cap. It really doesn't have anything to do with network management. So, that was kinda one thing that you heard. Also, you heard the FCC in 2024 initiated, I think it's a a notice of inquiry regarding data caps dealing with this very issue. When is it appropriate for a provider to impose data caps, which might be arbitrary if the network can handle capacity. So I just wanted to flag that as, I don't know the status, think it might be on hold, I'm not actually sure. I did try to find out an update of where the federal proceeding is. And then the next section is just about consumer complaints, Really trying to get a better handle on what those complaints are. Some complaints go to the Attorney General's Office, Kathy or not Kathy, Consumer CAF. Consumer Assistance Program. Thank you. Other complaints go to the Department of Public Service under Kathy. So wanting to have greater coordination and kind of one portal or at least one mechanism so that both parties understand what the complaints are. There is kind of a, I think an informal agreement between the AD's office and the department about referring certain complaints to each other. But anyway, this is trying to get at, let's have one database so that the state understands what the total complaints are, the nature of them, the disposition and so on. So then, the next section, line 17 monitoring competition, this kind of gets at what I was talking about before the attorney general under the Consumer Protection has the authority to enforce anti competitive practices, antitrust type of behaviors. And so this is just kind of drawing upon their general knowledge and authority in this area to focus on the broadband sector for the reasons I mentioned before, making sure there are not unfair practices between providers, that there's an ability for new entrants into the market. They're not being hoarded, and also that consumers are in a position to exercise their rights, not being beholding to one provider in particular. And so part of doing that, you know, there's a reference here to broadband consumer labels. This is part of the investment my gosh. I have to actually forget that it's a lot.

[Unidentified committee member(s) (diarization aggregate)]: It's

[Maria Royal (Legislative Counsel)]: IIJA. Thank you. That established the B program. Yeah. Also, require providers to have what's called the broadband consumer label, which is a like a a nutrition label that you would find on our food product that just very explicitly, and simply tells a customer what the costs are, what the fees are. And it's meant to not only for consumers without a particular service, but also so that they can comparison shop easily. So this is asking the attorney general to kind of look at those labels for specific areas and in part make sure that underserved or marginalized communities are not being charged higher prices, that there's basically the same services are offered throughout the state. There's no unfair discrimination going on. So and as part of that, providers are asked to include information about the services that they offer in the state. The number of service plans, both wired and wireless, the median and mean price, number of years they've been in business, all of their broadband availability data that goes on to mapping so that the AG can see get a real, very specific understanding of what the market looks like. And then just a requirement that there's no surgery in the reporting of that information. The next provision is transparency. This is similar to the label, but basically that the providers make very clear what their practices are for network management, security and privacy. This is available to consumers so that they can understand the service that they're purchasing and also it's forwarded to the attorney general. Again, trying to give as much information as possible to the attorney general to understand. The next section, keep Vermonters connected. This is very similar to the federal pledge. It was voluntary during COVID. Keep keep the Americans protected or connected. But what this is basically codifying that and saying in Vermont, if there is a declared state of emergency, that in in that situation that individuals could not be kicked off their broadband service. So, basically, codifying that for the state. So, then just investigation enforcement are similar to what's permitted now under the Consumer Protection Act provision that's, you know, requires the relevant entity, state entity, AG's office, Department of Public Service, Vermont, and Bram and Board to just share information for purposes of this bill. There is a provision that allows the attorney general to basically fill back, in other words, impose an assessment on providers for their costs that they incurred to do all this work. And it's very similar to a provision that the Commissioner of Financial Regulation has with respect to, I think it's the insurance industry. Confidentiality information proprietary can't be disclosed. An annual report that comes to you, the general assembly, reporting that all the information that's learned and any recommendations for improving conditions in the state. Dual making authority, other laws are not limited in any way because of this law that doesn't supersede other forms of recourse that might be available. Provisions are severable. So if there's anything held unconstitutional, one provision and other provisions would still take effect. And the authority, the tenth amendment, the state's authority to protect exercise the police powers to protect the public. So that's a broad overview. I hope I didn't go too fast on all of that, but I think this is the section that in light of some of your the testimony you heard today about consolidated might be relevant to that discussion. So these are consumer protections that are specific to VoIP service. So what this requires is the Commissioner of Public Service to establish a program for monitoring the health and public safety risks associated with the use of VoIP in Vermont, particularly during originating carrier or electric power outages. So the provider of VoIP service, there's they have an outage or if there's an electric outage that impacts the availability of VoIP service. If they're not line powered, they require require batteries. So if electricity goes out, the VoIP service will also go out unless they have some kind of battery backup. And there we'll talk about that in a minute because there are requirements now.

[Rep. Kathleen James (Chair)]: So so what we're talking about here is people, Vermonters who only have VoIP. That's their only way of getting a call out. And if power goes out and they don't have battery backup,

[Maria Royal (Legislative Counsel)]: that's definitely part of what's being looked at here. So right now, the originating carriers, the electric companies, they have to quarterly submit outage reports to the nine one one board. Right? We're required to do that by rule. That was the legislature required that rule making, I think, 2022. And so specifically, what they're what the commissioner is gonna look at is, are there areas of the state particularly prone to carrier or power outages and assess whether locations in those areas have access to facilities based fixed voice service. So an old copper legacy network. Do they also might some people might have both options or whether they have access over a cell phone provider. So, really trying to hone in on are there areas that don't have cell service and the legacy provider no longer offers service over a copper line, line powered. So their only option is VoIP service. Yeah. Because in the event of a power outage, they potentially be the most vulnerable in an emergency situation. This is the

[Rep. Laura Sibilia (Ranking Member)]: So I do not think we have included this here, but there are areas of the state where, emergency services, public safety was pretty far away. That's not a factor in this.

[Maria Royal (Legislative Counsel)]: No. So I wonder

[Rep. Kathleen James (Chair)]: wonder if

[Rep. Laura Sibilia (Ranking Member)]: there's a way to

[Maria Royal (Legislative Counsel)]: think about that. And if you want to hear more about the reporting that's done, Laura Sibilia is the executive director of the nine one one board, she can kind of aggregate the information at least and share that with you to the extent. Thanks. So then, so this is just making sure that the VoIP providers, comply with federal requirements about back of power obligations. So and those cross references might need to be updated, but what they're intended to get at so right now, think it was in 2015, VoIP providers needed to give consumers the option of purchasing backup power, that lasted for eight hours. Then I think it was in 2019, the FCC required providers to provide a second option to consumers, which they would have to purchase, I believe. Although, different providers might handle differently in terms of charges. But backup power that would last for twenty four hours. So, this is what they're required to offer or provide to their consumers. Eight hours. Eight hours or minimum. And, yes, a second option of twenty four hours.

[Rep. Kathleen James (Chair)]: And, are there any parameters set by the feds on the price, competitive, on the price of it?

[Maria Royal (Legislative Counsel)]: I don't think so. I let me just double check on that. I don't know that there are other and like I said, different providers. I don't know if they all charge or if they all charge the same amount, but I can try to find that out. I'll just also mention now the, reminders that might not, enjoy the benefit of being offered That the power are those Vermonters who had preexisting service. So the FCC requirements apply say that you need to offer this at a point of sale. So if you already had service, they might not proactively reach out to you, but they do have it they have to make some attempts to disclose what's available, what the risks are in the event of a power outage. But that's just one thing to think about, and that and that's related to Subdivision 4, which is developing consumer education community outreach initiatives to make sure all Vermonters understand what the risks are and what their options are in the event of a power outage. And then finally, this, again, part of the commissioner study establishment of this program is to make recommendations to you about any other additional consumer protections that should be available in Vermont, potentially including additional backup power requirements that supplement the FCC's federal requirements, potentially providing financial assistance to low income consumers for purchasing backup power equipment and any installation costs that might be charged, and additional consumer outreach, and anything else, the commission needs appropriate. And then finally, the commissioner has the assistance of the nine one one board, the attorney general's office, Department of Public Safety, and the Public Safety Communications Task Force, and VLCT. So trying to really understand geographically where the vulnerable spots are in addition.

[Rep. Laura Sibilia (Ranking Member)]: Yeah, Rebecca Sibilia. So, Maria, this morning, as part of the testimony, we heard about some voluntary behavior changes that may come about through an MOU. Let me ask about I asked about if we introduced, language and statute, if that would be supported, there was a sense that that might be federally preempted. This was really around notice to the E nine one one board and to the Department of Public Service who are not required to be noticed through the federal law. But, you know, the PUC and and the governor are, you know, the form of notice. I don't know if there's anything we can I don't know if there's anything we can do there to ensure that we

[Maria Royal (Legislative Counsel)]: It's greater notice beyond what the FCC requires? Yeah. Yeah. I had so I have to let me look into that a little bit more. I don't know if there's just a kind of a general field preemption. I don't think there is, but whether there are, but I have I only need to double check that.

[Rep. Kathleen James (Chair)]: And I'm sorry. Can't remember what we heard this morning. I she said they had reached out to The governor's office and the PUC. Secretary of War. And the sec yes. And the secretary of war. Sorry. Secretary of defense. And was that and did she say that that's that was those are the three requirements? That they are. Okay. So the secretary of defense, the PUC or whatever is the equivalent in each state and the governor's office. And their customers. Of course. And their customers. But that was what that is what the federal law requires right now. Okay.

[Maria Royal (Legislative Counsel)]: Okay. Let me look at that in greater detail and see what

[Rep. Kathleen James (Chair)]: what we're wondering is if we could pass something that goes above and beyond that in terms of notification and outreach that wouldn't just be preempted by we can't do this. Like sending a 130 page application to

[Rep. Laura Sibilia (Ranking Member)]: the governor's ceremonial office as notice for Vermonters that this is happening. Did

[Maria Royal (Legislative Counsel)]: somebody say something? Did you say something? Did not. So Are

[Unidentified committee member(s) (diarization aggregate)]: you hearing more? Too early in those.

[Rep. Kathleen James (Chair)]: I'm not. That's a little scary. Remember that one day? It was the first day we knew something was wrong. Okay. Back to the topic at hand.

[Unidentified committee member(s) (diarization aggregate)]: So I do have a question. Yeah. If there's if there's a pause in the voice.

[Maria Royal (Legislative Counsel)]: Yeah. Yeah.

[Unidentified committee member(s) (diarization aggregate)]: That's not

[Maria Royal (Legislative Counsel)]: me. Yeah. That's not me.

[Unidentified committee member(s) (diarization aggregate)]: I'm trying to remember where we left this last year. We just is this ran by the crossover deadlines, and we just dropped it and gone bad with things. Is that what happened?

[Rep. Kathleen James (Chair)]: Yeah. But I think there is there is more. I mean, we have I in my in my recollection, we have a lot of conflicting testimony.

[Unidentified committee member(s) (diarization aggregate)]: Yeah. Yeah. So Just looking at the at the testimony of the CCI.

[Rep. Laura Sibilia (Ranking Member)]: Yeah. Industry does not like it's Yeah. No.

[Rep. Kathleen James (Chair)]: And the AG wasn't wild about it.

[Maria Royal (Legislative Counsel)]: It was yeah. I just keep Apartment.

[Rep. Kathleen James (Chair)]: Nor was the apartment. Yeah.

[Maria Royal (Legislative Counsel)]: But Here we are.

[Rep. Kathleen James (Chair)]: But here we are. I I mean, section three is you know, I'm interested. I I I guess I'm curious to know whether whether we could proactively do any of this or whether it's just gonna be preempted by federal law, and it's all a

[Maria Royal (Legislative Counsel)]: waste of time. Yeah. I can I can find out? I'll research that.

[Rep. Kathleen James (Chair)]: Because it doesn't seem to me to be that onerous, you know, of a thing to require a company to do to have a more robust And just public notification process.

[Maria Royal (Legislative Counsel)]: If for some reason that we're preempted, and I don't I don't know the answer to it, there may be other workarounds, like notice to the department that can then provide general notice. Mean, might be easiest to get, you know, to receive something from the provider in mail, but I'm just saying there are other options that might, the state might be able to do that doesn't impose obligations on the provider if there were

[Rep. Laura Sibilia (Ranking Member)]: a preemptive. Yes. Yeah. So, Marie, can you just remind me that so federal law is not pretty involved. You know, states have some ability to protect their

[Maria Royal (Legislative Counsel)]: Absolutely. So can you help Well to the law Yes. So congress has authority over interstate commerce. And to the extent congress wants to pass a law on a particular area preempting the state given supremacy clause, congress can do that. So the question here is, congress has delegated rule making at the FCC, which is the basis for the FCC back of power requirements. So one, did congress say anything about preemption? If not, is there anything in the in the federal law that implicitly preempts what a state might do? And then finally, if a state law conflicts with the field that's regulated by the FCC, which I don't think it's field preemption here, or state passes a law that unduly burdens interstate commerce. If there's no explicit preemption, those are the types of things that this issue is probably one of, like, the biggest issues right now because with everything being interstate and commerce, particularly what's done online, what's left for states? What's reserved to the states even if congress is trying to preempt, you know, everything? You know, is there some residual we need to pass in the best interest of our public? So these powers of the state, interstate commerce powers of congress, delegated to the applicable agencies, you know, those are these are the type of things. And if there isn't an explicit explicit preemption and the state law serves a legitimate purpose, it's narrowly tailored, doesn't unduly burden interstate commerce, and it's likely okay. So it's usually a very fact specific inquiry.

[Rep. Kathleen James (Chair)]: Questions for? You're not saying. So it's reassuring.

[Unidentified committee member(s) (diarization aggregate)]: I was just covered.

[Maria Royal (Legislative Counsel)]: Okay. This is gonna be bad.

[Rep. Kathleen James (Chair)]: Maria, thank you so much. I think that we can go offline. Okay. So Alright. So