In a classic example of corporate control over legislative bodies, the California Senate Energy, Utilities and Communications Committee voted 6 to 1 last Monday for an AT&T bill that will deny low-income Californians meaningful discounted LifeLine rates for cell phone service. Some 1.2 million low-income consumers could be impacted. Three key Democrats, Senators Alex Padilla (who is running for California Secretary of State), Roderick Wright and Jerry Hill, joined with three Republicans to deliver the 6 votes needed to pass AB 1407 out of committee.

Assembly Member Steven Bradford (D-Inglewood) was the front person for AT&T in authoring AB 1407, which turns LifeLine into a voucher system that provides no protection from rate increases and gets rid of most oversight by the California Public Utilities Commission (CPUC).  

The Coalition for Economic Survival (CES) joined with a broad-based alliance of community, senior, consumer and labor organizations, such of AARP, California Labor Federation and The Utility Reform Network (TURN) in opposing AB 1407 as an economic attack on low-income consumers in the state. In addition, the CPUC voted, 4-1, to oppose AB 1407 at its June 27th meeting.  

The bill would establish a California LifeLine that is similar to a federal program that hands out inexpensive cellphones with minimal service features. It would repeal the PUC's authority to set rates and lock into law an $11.85 discount that a LifeLine customer could apply toward any voice service offered by a participating cellphone company.  

AB 1407 would set up a system similar to the Section 8 rent subsidy tenant voucher, where renters who receive the subsidy have to find a landlord who will accept the voucher and then negotiate the rent, as opposed to a Project-Based Section 8 subsidy, which provides long-term affordable housing by having the voucher attached to the unit, not the tenant.

And, while most of the major consumer and ratepayer advocates are opposing AB 1407, leave it to AT&T to buy some support from a number of groups, such as civil rights, senior citizens and business associations, most who are regular recipients of AT&T charitable contributions.

Over the last couple of months, a large number of consumer and community-based organizations have provided input on wireless LifeLine policy at public hearings in Los Angeles, Riverside, San Diego, and San Francisco, with upcoming hearings in Eureka, Redding, Fresno, and Salinas. AB 1407 would disregard this democratic process and ignore the hundreds that have testified in support of a real LifeLine program.

Unfortunately, it's not a surprise that these Democrats have caved in to AT&T demands given that the corporate giant made $841,000 in campaign contributions in the 2011-12 legislative session and have spent $4.4 million on lobbying government officials during the same period, according to the California Secretary of State.