The California Emerging Technology Fund (CETF) has been established as a non-profit corporation pursuant to orders from the California Public Utilities Commission (CPUC) in approving the mergers of SBC-AT&T and Verizon-MCI in 2005. As a condition of approval of the mergers, AT&T and Verizon are required to contribute to CETF a total of $60 million over 5 years "for the purpose of achieving ubiquitous access to broadband and advanced services in California, particularly in underserved communities, through the use of emerging technologies by 2010." AT&T will contribute $9 million per year and Verizon will contribute $3 million per year. The CPUC also directed that at least $5 million should be used for telemedicine projects.
The CPUC stated that CETF should adopt the goals of expanding adoption and usage of broadband technology in addition to promoting ubiquitous access: "We understand that without computers and computer literacy neither availability nor access will ensure use. It is low use that is at the heart of the digital divide. CETF should consider the possibility of public/private partnerships to develop community broadband access points that provide both."
The CPUC orders specified the composition and process for constituting the 12-person CETF Board of Directors: 4 were to be appointed by the CPUC, 4 were to be appointed by the companies (3 by SBC of which only 1 could be an employee and 1 by Verizon), and these eight were to appoint the remaining 4. The appointments were to reflect both the diversity of California and the private-sector expertise to achieve ubiquitous broadband. Initial appointments were made in April 2006 and the Board was fully constituted by the end of June 2006.