[Federal Register Volume 62, Number 109 (Friday, June 6, 1997)]
[Rules and Regulations]
[Pages 31003-31005]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 97-14649]
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FEDERAL COMMUNICATIONS COMMISSION
47 CFR Part 61
[CC Docket No. 92-135, FCC 97-41]
Regulatory Reform for Small and Mid-Size Local Exchange Carriers
Subject to Rate-of-Return Regulation
AGENCY: Federal Communications Commission.
ACTION: Final rule; petition for reconsideration.
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SUMMARY: In this Order, the Commission considers petitions for
reconsideration and clarification concerning regulatory reform for
local exchange carriers subject to rate of return regulations (Small
Telco Reform Order). In particular, the Order eliminates the two year
notice period that local exchange carriers must provide before exiting
the incentive plan, clarifies the rules consistent with the Small Telco
Reform Order, and amends the rules and clarifies several matters raised
by the petitioners. The Commission's action is intended to eliminate
any ambiguities and inconsistencies in the Commission's rules and the
Small Telco Reform Order.
EFFECTIVE DATE: July 7, 1997.
FOR FURTHER INFORMATION CONTACT: Dan Abeyta, (202) 418-1538.
SUPPLEMENTARY INFORMATION: This is a summary of the Commission's Order
On Reconsideration in CC Docket No. 92-135 (FCC 97-41) adopted on
February 10, 1997 and released on February 18, 1997. The full text of
this Order on Reconsideration is available for inspection and copying
during normal business hours in the FCC Reference Center (Room 239),
1919 M Street, N.W., Washington, D.C. 20037.
The complete text may also be obtained through the World Wide Web,
at http:/www.fcc.gov/Bureau/Common/Carrier/Order/fcc9741.wp or may be
purchased from the Commission's copy contractor, International
Transcription Services, Inc. (202) 857-3800, 2100 M Street, N.W., Suite
140, Washington, D.C. 20037.
Regulatory Flexibility Analysis
No significant impact.
[[Page 31004]]
Paperwork Reduction Act
No significant impact.
Synopsis of Report and Order
On February 18, 1997, after reviewing petitions for reconsideration
and clarification filed by American Telephone and Telegraph Company,
the National Exchange Carriers Association, and the United States
Telephone Association (hereinafter, Petitioners), the Commission
released an Order on Reconsideration in CC Docket No. 92-135.
Petitioners sought reconsideration and clarification of several issues
addressed in the Small Telco Reform Order. Petitioners (1) request that
the Commission reconsider reducing the two year notice period that LECs
must provide before exiting the incentive plan; (2) argue that the
prohibition against reentry into the pools violates pool neutrality and
the voluntary nature of pools; (3) seek reconsideration of the
provision in the incentive plan that allows LECs rate adjustments of
10% within each service category over each two-year tariff period
because Petitioners believe the rule could be interpreted to allow LECs
using the incentive plan to recover 110% of their costs; (4) request
that the incentive plan's streamlined filing requirements for new
services be extended to apply to new services in territories where the
``geographically closest'' (but not bordering) price cap LEC offers the
same service; and (5) request that the Commission delete the
infrastructure reporting requirements for the incentive plan, arguing
that such reports are not required for voluntary price cap LECs and
should not be required for incentive plan LECs. In response to these
requests for revisions, the Commission eliminated the two-year exit
notice requirement, but otherwise declined to make the requested
revisions to the Small Telco Reform Order.
The Petitioners also sought clarification of several issues
addressed in the Small Telco Reform Order. Petitioners argued that the
rules embodying the common line rate structures for the incentive plan
and small company rules are inconsistent with the text of the Small
Telco Reform Order, and should be clarified. In response, the
Commission believes the rules are consistent with the Small Telco
Reform Order, but nonetheless has redrafted the rules as formulae to
eliminate any inconsistencies in the Small Telco Reform Order's
application. Petitioners requested that we add a clarifying statement
concerning the relative burden on incentive plan participants that seek
to increase their rates by making mid-term corrections to their
tariffs. The Commission believes the Small Telco Reform Order is clear
and therefore denies this request for clarification. Petitioners
requested that the Commission codify the incentive plan's mechanism for
exogenous cost adjustment. The Commission agrees, and amends its rules
to codify the Small Telco Reform Order's provisions that incentive plan
LECs may adjust their rates (either in the biennial tariff filing or
during the two-year tariff period) to reflect exogenous cost changes
for costs deemed exogenous for price cap LECs. Finally, Petitioners
requested that to remove potential ambiguities, the Commission should
make certain minor, non-substantive revisions to the sections of the
Small Telco Reform Order concerning voluntary biennial filings, the
base period for end user common line calculations, and rate change
indexes. This Order on Reconsideration amends the Small Telco Reform
Order to clarify those matters.
List of Subjects in 47 CFR Part 61
Communications common carriers, Reporting and recordkeeping
requirements.
Federal Communications Commission.
Shirley S. Suggs,
Chief, Publications Branch.
Rule Changes
Accordingly part 61 of title 47 is amended as follows:
PART 61--TARIFFS
1. The authority citation for part 61 continues to read as follows:
Authority: Secs. 1, 4(i), 4(j), 201-205, and 403 of the
Communications Act of 1934, as amended; 47 U.S.C. 151, 154(i),
154(j), 210-205, and 403, unless otherwise noted.
2. Section 61.39 is amended by revising paragraphs (b)(3)(i),
(b)(3)(ii), (b)(4)(i) and (b)(4)(ii) to read as follows:
Sec. 61.39 Optional supporting information to be submitted with
letters of transmittal for Access Tariff filings effective on or after
April 1, 1989, by local exchange carriers serving 50,000 or fewer
access lines in a given study area that are described as subset 3
carriers in Sec. 69.602.
* * * * *
(b) * * *
(3) * * *
(i) For the first biennial filing, the common line revenue
requirement shall be determined by a cost of service study for the most
recent 12-month period. Subscriber line charges shall be based on cost
and demand data for the same period. Carrier common line rates shall be
determined by the following formula:
[GRAPHIC] [TIFF OMITTED] TR06JN97.008
where:
[GRAPHIC] [TIFF OMITTED] TR06JN97.009
And where:
CCL Rev Req = carrier common line revenue requirement for the most
recent 12-month period;
CCL MOUb = carrier common line minutes of use for the most
recent 12-month period;
CCL MOU1 = CCL MOUb; and
CCL MOU0 = carrier common line minutes of use for the 12-
month period preceding the most recent 12-month period.
(ii) For subsequent biennial filings, the common line revenue
requirement shall be determined by a cost of service study for the most
recent 24-month period. Subscriber line charges shall be based on cost
and demand data for the same period. Carrier common line rates shall be
determined by the following formula:
[GRAPHIC] [TIFF OMITTED] TR06JN97.010
Where:
[GRAPHIC] [TIFF OMITTED] TR06JN97.011
And where:
CCL Rev Req = carrier common line revenue requirement for the most
recent 24-month period;
CCL MOUb = carrier common line minutes of use for the most
recent 24-month period;
CCL MOU1 = carrier common line minutes of use for the 12-
month period; and
CCL MOU0 = carrier common line minutes of use for the 12-
month period preceding the most recent 12-month period.
(4) * * *
(i) For the first biennial filings, the common line revenue
requirement shall be determined by the local exchange carrier's most
recent annual Common Line settlement from the National Exchange Carrier
Association. Subscriber line charges shall be based on cost and demand
data for the same period. Carrier common line rates shall be determined
by the following formula:
[GRAPHIC] [TIFF OMITTED] TR06JN97.012
Where:
[[Page 31005]]
[GRAPHIC] [TIFF OMITTED] TR06JN97.013
And where:
CCL Rev Req = carrier common line settlement for the most recent 12-
month period;
CCL MOUb = carrier common line minutes of use for the most
recent 12-month period;
CCL MOU1 = CCL MOUb; and
CCL MOU0 = carrier common line minutes of use for the 12-
month period preceding the most recent 12-month period.
(ii) For subsequent biennial filings, the common line revenue
requirement shall be an amount calculated to reflect the average
schedule pool settlements the carrier would have received if the
carrier had continued to participate in the carrier common line pool,
based upon the average schedule Common Line formulas developed by the
National Exchange Carrier Association for the most recent 24-month
period. Subscriber line charges shall be based on cost and demand data
for the same period. Carrier common line rates shall be determined by
the following formula:
[GRAPHIC] [TIFF OMITTED] TR06JN97.014
Where:
[GRAPHIC] [TIFF OMITTED] TR06JN97.015
And where:
CCL Rev Req = carrier common line settlement for the most recent 24-
month period;
CCL MOUb = carrier common line minutes of use for the most
recent 24-month period;
CCL MOU1 = carrier common line minutes of use for the most
recent 12-month period; and
CCL MOU0 = carrier common line minutes of use for the 12-
month period preceding the most recent 12-month period.
* * * * *
3. Section 61.50 is amended by revising paragraphs (h)(1) and (k)
and adding new paragraphs (h)(3) and (i)(3) to read as follows:
Sec. 61.50 Scope: Optional incentive regulation for rate of return
local exchange carriers.
* * * * *
(h)(1) In connection with any optional incentive plan tariff filing
proposing rate changes, the carrier must calculate an index for each
affected basket as determined by the Common Carrier Bureau.
* * * * *
(3) Local exchange carriers subject to this section shall file
tariff revisions that reflect rate changes due to exogenous costs, as
defined in Sec. 61.45(d)(1), either in the biennial tariff filing or at
the time the event causing the exogenous costs occurs during the two-
year period.
(i) * * *
(3) All filings for new services other than those described in
paragraph (i) shall be supported using prospective data, as required by
Sec. 61.38 of these rules.
* * * * *
(k) For a tariff change, a local exchange carrier that is a cost
schedule carrier must propose Common Line rates based on the following:
(1) For the first biennial filing, the common line revenue
requirement shall be determined by a cost of service study for the most
recent 12-month period. Subscriber line charges shall be based on cost
and demand data for the same period. Carrier common line rates shall be
determined by the following formula:
[GRAPHIC] [TIFF OMITTED] TR06JN97.016
Where:
[GRAPHIC] [TIFF OMITTED] TR06JN97.017
And where:
CCL Rev Req = carrier common line settlement for the most recent 12-
month period;
CCL MOUb = carrier common line minutes of use for the most
recent 12-month period;
CCL MOU1 = CCL MOUb; and
CCL MOU0 = carrier common line minutes of use for the 12-
month period preceding the most recent 12-month period.
(2) For the subsequent biennial filings, the common line revenue
requirement shall be determined by a cost of service study for the most
recent 24-month period. Subscriber line charges shall be based on cost
and demand data for the same period. Carrier common line rates shall be
determined by the following formula:
[GRAPHIC] [TIFF OMITTED] TR06JN97.018
where:
[GRAPHIC] [TIFF OMITTED] TR06JN97.019
and where:
CCL Rev Req = carrier common line revenue requirement for the most
recent 24-month period;
CCL MOUb = carrier common line minutes of use for the most
recent 24-month period;
CCL MOU1 = carrier common line minutes of use for the most
recent 12-month period; and
CCL MOU0 = carrier common line minutes of use for the 12-
month period preceding the most recent 12-month period.
(3) For End User Common Line charges included in a tariff pursuant
to this section, the local exchange carrier must provide supporting
information for the two-year historical period with its letter of
transmittal in accordance with Sec. 61.38.
[FR Doc. 97-14649 Filed 6-5-97; 8:45 am]
BILLING CODE 6712-01-P
