California lawmakers and regulators weigh future of ‘carrier of last resort’ as AT&T seeks relief

SACRAMENTO — The California State Assembly Communications Conveyance Committee held an informational hearing on carrier of last resort (COLR) obligations, commonly called COLR or COLOR, as the California Public Utilities Commission (CPUC) and stakeholders debate whether long-standing regulatory duties tied to landline voice service should be revised for a broadband-era market.

Chair Tasha Burner, chair of the Assembly Communications Conveyance Committee, opened the hearing saying the purpose was “to provide an opportunity for members and the public to gain a better understanding of what COLR has been historically, how it operates in the market today, and also understand what it means for the future.” The committee assembled three panels: a nonpartisan history and law overview, CPUC staff on a pending regulatory process, and stakeholders representing industry and the CPUC’s Public Advocates Office.

The hearing placed AT&T’s 2023 application at center stage. CPUC staff described AT&T’s petition as seeking relief from COLR obligations in the majority of its California territory — an approach AT&T said would follow identification of “demonstrated voice alternatives” in census blocks and would have covered roughly “more than 99%” of its territory as proposed. Rob Osborne, Director of Broadband Consumer Programs and Carrier Oversight at the CPUC, told the committee the CPUC’s initial administrative-law-judge ruling dismissed AT&T’s application for procedural defects; the CPUC also has opened a broader rulemaking to reexamine COLR rules dating from 1996 and the CPUC’s definition of “basic service,” last updated in 2012.

Why it matters: COLR rules guarantee that the incumbent provider in a service territory must offer basic local service — historically dial tone, 911 access and other minimums — to any customer who requests it. Supporters of reform say modern broadband and wireless alternatives make strict landline-era obligations obsolete and that lifting outdated duties would free resources for network upgrades. Opponents warn that ending the obligation turns universal guarantees into discretionary options and raises risks for low-income, rural, elderly and disabled residents and for public safety during disasters.

Nonpartisan and regulatory context: Dr. Lichtenberg, appearing for the National Association of Regulatory Utility Commissioners in the first panel, reviewed the legal history of COLR going back to the early 20th century’s universal-service concepts and to the Telecommunications Act of 1934 and its 1996 amendments. He summarized COLR’s functional role as “a backstop” to ensure basic local telephone service and said states have taken many different paths, from continuing full COLR duties to creating pathways to withdraw where “effective competition” exists.

CPUC update and outreach: Anna Maria Johnson, Deputy Executive Director for Broadband and Communications at the CPUC, told lawmakers the CPUC’s staff presentation was “from CPUC staff in the Communications Division” and that CPUC rules have required COLR obligations since the 1990s. Johnson said California currently lists 16 COLR-designated companies; AT&T and Frontier serve the vast majority of the state by population (AT&T was estimated in the hearing to cover roughly 75% of Californians, Frontier about 24% and the remaining 1% by consolidated and 13 small rural local exchange carriers). The CPUC described its new rulemaking as considering whether to revise the COLR rules, whether the nine-element definition of basic service needs updating, how to validate acceptable alternatives, appropriate customer-notification and transition periods, and whether certain areas could be de-designated from COLR requirements.

Public input and process: CPUC staff said the AT&T application generated more than 5,000 public comments, with more than 2,000 participants in public participation events and roughly 400 oral comments at in-person hearings in Clovis, Mendocino and Indio. The CPUC described planned outreach for the broader rulemaking: 14 public participation hearings (mix of in-person and remote), three workshops including tribal, public-safety and rural-county panels, and a staff proposal expected in the third quarter of the year with a proposed decision later in the year or into mid-2026 depending on the record.

Stakeholder split: Industry and consumer-advocate witnesses gave sharply different accounts of the public-interest tradeoffs. Jonathan Spalter, president of U.S. Telecom, urged reform to free investment for modern networks and reduce the cost of maintaining legacy copper infrastructure; he described copper as “energy hogs” and argued modernized services will improve emergency capabilities and offer consumer alternatives. By contrast, Ernesto Falcone of the CPUC’s Public Advocates Office urged caution, saying “any transition should keep people connected with equivalent service or improve their service,” and proposed a conditional pathway in which deregulation would require verifiable broadband upgrades for affected communities before withdrawing COLR obligations.

Public safety and lived experience: Testimony and public comment repeatedly returned to 911 access and reliability during disasters. Several witnesses — including law enforcement and disaster-recovery specialists — and multiple public commenters said landlines had been essential during wildfires and other emergencies where wireless service was unreliable. The CPUC and Public Advocates cited California requirements unrelated to COLR — for example, backup power or service-quality reporting in high-fire-threat areas — as complementary public-safety protections, but many speakers said those measures do not eliminate the need for robust verification of any alternative technology offered as a substitute for COLR-protected service.

Equity and the digital divide: Committee members and witnesses emphasized that low-income households, many tribal communities and small rural providers could be disproportionately affected by any rollback of COLR duties. The Public Advocates Office proposed requiring broadband at an FCC-recognized baseline (the office recommended 120 megabits per second in testimony) as part of a negotiated transition and argued that a portion of any regulatory savings should be reinvested in underserved communities. CPUC staff noted the state also operates lifeline and other subsidy programs and publishes quarterly service-quality reports for regulated carriers.

What did not change at the hearing: there were no formal votes taken. The CPUC staff reiterated that the earlier AT&T application was dismissed for failing to meet procedural requirements and that the matter is now being examined in a broader rulemaking. Committee members signaled interest in legislative engagement alongside the CPUC rulemaking; several lawmakers urged the Legislature to define policy guardrails rather than relying entirely on administrative process.

Outlook: The CPUC’s rulemaking schedule includes public hearings and workshops through spring and summer and expects to issue a staff proposal later in the year. Any future change to COLR obligations in California would implicate public-safety rules, subsidy programs, verification protocols for alternative technologies and detailed transition plans to avoid service gaps for vulnerable residents. Committee members said they plan further oversight and possible legislative action to clarify priorities such as universal access, affordability, public safety and protections for rural and tribal communities.

Ending: The hearing highlighted a deep policy divide: industry and some consumer groups argue reform will accelerate deployment of modern, efficient networks; public advocates, labor and many residents warned that without binding, verified replacements the state would convert guaranteed service into a patchwork of options that could leave some Californians at greater risk. The CPUC’s continuing rulemaking and the Legislature’s next steps will shape whether California pursues a phased, verifiable transition or preserves COLR guarantees in largely their current form.