HB2625 - 451R - House Bill Summary

House of Representatives

HB 2625

emergency 911 services; revenue

Sponsors: May, Giffords: Carpenter, et al

DPA	Committee on Energy Utilities & Technology
DPA	Committee on Ways & Means
DPA	Caucus and COW	This bill as introduced contains *a PROP 108 clause.*
X	As Transmitted To the Governor

House Bill 2625 provides an increase in the telecommunications service excise tax in order to update equipment used for the emergency telecommunication services.

History

Local and regional 9-1-1 committees work with the telecommunications industry to address emergency communications. The DOA is the administrator of the fund for emergency communications and all funding for emergency communications infrastructure must be approved by DOA. Since 1983 the State has funded the statewide 9-1-1 telecommunications services with an excise tax on telephone service. Currently this excise tax stands at about $.16 for landlines and at $.10 for wireless phones. In recent years these rates have not created enough revenues to fund the new equipment necessary to provide the 9-1-1 telecommunications services. New equipment is necessary due to the increase of wireless phone use. In Arizona, when wireless phones are used to call 9-1-1, the 9-1-1 operators can not get a location of the caller nor can they return the call if disconnection occurs because the wireless phone does not register a phone number in the system.

The rate increase in this bill addresses the cost of the new equipment and the corresponding FCC requirements for 9-1-1 telecommunications, which comes in two phases. The first phase requires the Wireless vendor to deliver to the Public Safety Answering Point (PSAP) data, which represents the complete 10-digit telephone number of the wireless handset, the street address of the Wireless tower, and the antenna face on that tower being utilized for the 9-1-1 call. This information would allow a call-talker at the PSAP to reasonably define a geographic area from which the call has originated and have the telephone number for callback purposes in case of disconnect.

The second phase requires the delivery of the 10-digit number of the Wireless handset, but, the cell tower address and antenna face are replaced with a requirement to provide the actual latitude and longitude coordinates of the Wireless device within 125 meters (400 feet) with a minimum 67% accuracy. Also included in this data stream sent to PSAP is the confidence level of the accuracy of the location data provided, the direction of travel, speed of travel, and height above sea level.

Attached to the summary are two charts. One chart shows a state-by-state comparison of 9-1-1 tax rates. The second chart shows projected costs of equipment and estimates of the tax revenues produced by the rate increase. Both charts were supplied by DOA.

Provisions

· Removes the current tax rates of sixteen cents for landlines and ten cents for wireless service and sets new rates for both wire and wireless service to finance emergency telecommunication services as follows:

Ø Beginning July 1, 2001, a tax levy of 37 1/2 cents per month

Ø Beginning July 1, 2006, the tax levy at 28 cents per month

Ø Beginning July 1, 2007 and thereafter, the tax levy at 20 cents per month

· Beginning in FY 2002, and every two years thereafter (currently every year), the Legislature must review the telecommunication services excise tax and make recommendations.

· Requires that priority for funding be given to areas of the state that are currently without 9-1-1 services.

· Currently, three percent of the fund is allocated to DOA for administrative costs. Beginning with FY 2002, DOA can use up to two-thirds of their administration costs and the remainder may be allocated to Public Safety Answering Point (PSAP) contracts.

· Expands the use of the Emergency Telecommunication Services Revolving Fund to allow a wireless carrier’s one-time costs associated with the emergency 9-1-1 network to the extent that the wireless carrier has not recovered costs through the deduction mechanism specified in federal law.

· Requires telecommunication providers to provide a separate line item on each monthly bill for the tax on emergency 9-1-1 services and telecommunication services for the deaf.

· Establishes a 9-1-1 study committee consisting of five legislators, two members of the public who are representatives of the wireless telecommunications industry, two members of the public who are representatives of the wireline telecommunications industry, two PSAP representatives with one from a rural area and one from an urban area, and one member representing DOA. The study committee duties include an examination of the following:

Ø The necessity of the requirements for maintaining and upgrading the current 911 system.

Ø The funding mechanisms utilized by the state of Arizona to provide services and equipment required to handle 9-1-1 calls.

Ø The cost estimates for maintaining and upgrading the current 911 system.

Ø Recommendations for funding mechanisms to cover the maintenance and upgrades of the current 9-1-1 system, including determining the advisability of separating the monies in the revolving fund between wire and wireless providers.

· The study committee may utilize legislative staff. The committee is required to submit a report regarding the committee’s recommendations for the Arizona 9-1-1 system by December 1, 2001 and the committee is repealed beginning in 2002.

· This bill contains a PROP 108 clause.

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45th Legislature