House Bill hb1683c1
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    Florida House of Representatives - 2002             CS/HB 1683
        By the Council for Ready Infrastructure and Committee on
    Utilities & Telecommunications and Representative Maygarden
  1                      A bill to be entitled
  2         An act relating to switched network access
  3         rates; amending s. 364.10, F.S.; revising
  4         provisions for Lifeline Assistance Plan
  5         service; providing for certification and
  6         maintenance of claims by Office of Public
  7         Counsel; requiring certain local exchange
  8         telecommunications companies to provide
  9         specified materials relating to the plan;
10         requiring state agencies to provide such
11         material to affected applicants; exempting plan
12         beneficiaries from certain rate increases under
13         certain circumstances; amending s. 364.163,
14         F.S.; revising provisions relating to caps on
15         rates; deleting provisions relating to recovery
16         of costs of government programs; revising
17         provisions relating to rate changes; providing
18         for adjustments in long distance revenues and
19         pass-through to customers; creating s. 364.164,
20         F.S.; providing for establishment of revenue
21         categories; providing for notification;
22         providing for timetable for reductions in
23         access rates; providing for revenue neutrality;
24         providing for notice; providing definitions;
25         providing for oversight of local exchange
26         companies; providing an effective date.
27
28  Be It Enacted by the Legislature of the State of Florida:
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30         Section 1.  Subsection (3) is added to section 364.10,
31  Florida Statutes, to read:
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  1         364.10  Undue advantage to person or locality
  2  prohibited; exception.--
  3         (3)(a)  Any local exchange telecommunications company
  4  subject to the provisions of s. 364.164(1)(a) and any
  5  telecommunications company electing under s. 364.164(1)(b)
  6  shall, effective March 31, 2003, have tariffed and shall
  7  provide Lifeline Assistance Plan service to any otherwise
  8  eligible customer or potential customer who meets an income
  9  eligibility test at 125 percent or less of the federal poverty
10  income guidelines for Lifeline Assistance Plan customers. Such
11  test for eligibility shall augment, rather than replace, the
12  eligibility standards established by federal law and based on
13  participation in certain low-income assistance programs. Each
14  interexchange telecommunications carrier shall, effective
15  March 31, 2003, file a tariff providing, at a minimum, the
16  current Lifeline Assistance Plan benefits and exemptions to
17  Lifeline Assistance Plan customers who meet the income
18  eligibility test set forth in this subsection. The Office of
19  Public Counsel shall serve as the state agency which certifies
20  and maintains claims submitted by a customer for eligibility
21  under the income test authorized by this subsection.
22         (b)  Each local exchange telecommunications company
23  subject to this subsection shall provide to each state and
24  federal agency that provides benefits to persons that are
25  eligible for the Lifeline Assistance Plan applications,
26  brochures, pamphlets, or other materials which inform such
27  persons of their eligibility for the Lifeline Assistance Plan,
28  and each state agency providing such benefits shall furnish
29  such materials to affected persons at the time such persons
30  apply for benefits.
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  1         (c)  Any local exchange telecommunications company
  2  customer receiving Lifeline Assistance Plan benefits shall not
  3  be subject to any residential basic local telecommunications
  4  service rate increases authorized by s. 364.164 until such
  5  time as the local exchange telecommunications company reaches
  6  parity as defined in s. 364.164(5) or until the customer no
  7  longer qualifies for the Lifeline Assistance Plan benefits
  8  established by this section or s. 364.105, or unless otherwise
  9  determined by the commission upon petition by a local exchange
10  telecommunications company.
11         Section 2.  Section 364.163, Florida Statutes, is
12  amended to read:
13         364.163  Network access services.--For purposes of this
14  section, "network access service" is defined as any service
15  provided by a local exchange telecommunications company to a
16  telecommunications company certificated under this chapter or
17  licensed by the Federal Communications Commission to access
18  the local exchange telecommunications network, excluding the
19  local interconnection arrangements in s. 364.16 and the resale
20  arrangements in s. 364.161. Each local exchange
21  telecommunications company subject to s. 364.051 shall
22  maintain tariffs with the commission containing the terms,
23  conditions, and rates for each of its network access services.
24         (1)  Effective January 1, 1999, the rates for switched
25  network access services of each company subject to this
26  section shall be capped at the rates in effect on January 1,
27  1999, and shall remain capped until January 1, 2001. Upon the
28  date of filing its election with the commission, the network
29  access service rates of a company that elects to become
30  subject to this section shall be capped at the rates in effect
31  on that date and shall remain capped for 5 years.
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  1         (1)(2)  After the termination of the caps imposed on
  2  rates by subsection (1) and after a local exchange
  3  telecommunications company's intrastate switched network
  4  access rates are reduced to or below reach parity, as defined
  5  in s. 364.164(5), the company's intrastate switched network
  6  access rates shall be capped and shall remain capped for 3
  7  years thereafter. with its interstate switched access rates, a
  8  company subject to this section may, on 30 days' notice,
  9  annually adjust any specific network access service rate in an
10  amount not to exceed the cumulative change in inflation
11  experienced after the date of the last adjustment, provided,
12  however, that no such adjustment shall ever exceed 3 percent
13  annually of the then-current prices.  Inflation shall be
14  measured by the changes in Gross Domestic Product Fixed 1987
15  Weights Price Index, or successor fixed weight price index,
16  published in the Survey of Current Business, or successor
17  publication, by the United States Department of Commerce.
18         (3)  After the termination of the caps imposed on rates
19  by subsection (1), a company subject to this section may, at
20  any time, petition the commission for a network access service
21  rate change to recover the cost of governmentally mandated
22  projects or programs or an increase in federal or state income
23  tax incurred after that date.  The costs and expenses of the
24  government program or project required in part II of this
25  chapter shall not be recovered under this subsection unless
26  such costs and expenses are incurred in the absence of a bid
27  and subject to carrier of last resort obligations as provided
28  for in part II of this chapter.  With respect to
29  governmentally mandated projects and programs, such petition
30  shall be acted upon no later than 90 days after the date of
31  filing.  A company subject to this section shall show the
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  1  commission that the cost of a project or program is not
  2  recoverable either from the government mandating the project
  3  or program or from the beneficiaries of the project or program
  4  through user fees or other new revenue sources from the
  5  project or program, and to the extent that cost decreases
  6  resulting from the project or program are reflected as an
  7  offset to cost increases.  A company subject to this section
  8  shall decrease its network access rates by amounts that
  9  reflect any federal or state income tax reduction. Nothing
10  contained in this section shall allow any revisions in the
11  rates, terms, and conditions for commercial mobile radio
12  service access, which revisions are inconsistent with the
13  requirements or methodologies of the Federal Communications
14  Commission.
15         (4)  A company subject to this section may choose to
16  implement all or a portion of a rate increase allowed for
17  network access service by subsections (1), (2), and (3).
18  Notwithstanding subsections (1), (2), and (3), a company
19  subject to this section may choose to decrease network service
20  rates at any time, and decreased rates shall become effective
21  upon 7 days' notice.
22         (5)  Company-proposed changes to the terms and
23  conditions for existing network access services in accordance
24  with subsections (1), (2), (3), and (4) shall be presumed
25  valid and become effective upon 15 days' notice.
26  Company-proposed rate reductions shall become effective upon 7
27  days' notice. Rate increases made by the local exchange
28  telecommunications company shall be presumed valid and become
29  effective on the date specified in the tariff, but in no event
30  earlier than 30 days after the filing of such tariff.  The
31  commission shall have continuing regulatory oversight of local
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  1  exchange telecommunications company-provided network access
  2  services for purposes of determining the correctness of any
  3  price increase resulting from the application of the inflation
  4  index and making any necessary adjustments, establishing
  5  reasonable service quality criteria, and assuring resolution
  6  of service complaints. No later than 30 days after the filing
  7  of such tariff, the commission may, with respect to
  8  determining the correctness of any price increase, vote,
  9  without hearing, the local exchange telecommunications company
10  to hold subject to refund all revenues collected under the
11  rate increase. Within 60 days after such order, the commission
12  must make a determination either compelling a refund of all or
13  part of such revenues or releasing them from such requirement.
14         (2)(6)  Any local exchange telecommunications company
15  with more than 100,000, but fewer than 3 million, basic local
16  telecommunications service access lines in service on July 1,
17  1995, shall reduce its intrastate switched access rates by 5
18  percent on July 1, 1998, and by 10 percent on October 1, 1998.
19  Any interexchange telecommunications carrier company whose
20  intrastate switched network access rate is reduced as a result
21  of the rate adjustments decreases made by a local exchange
22  telecommunications company in accordance with s. 364.164 this
23  subsection shall decrease its intrastate long distance
24  revenues rates by the amount necessary to return the benefits
25  of such reduction to both its residential and business
26  customers but shall not reduce per minute intra-LATA toll
27  rates by a percentage greater than the per minute intrastate
28  switched access rate reductions required by this act. The
29  interexchange telecommunications carrier may determine the
30  specific intrastate rates to be decreased, provided that
31  residential and business customers benefit from the rate
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  1  decreases. However, any interexchange telecommunications
  2  carrier that charges an in-state connection fee shall use any
  3  decrease in the intrastate switched network access rate
  4  reductions required by s. 364.164 to first eliminate that fee
  5  before it reduces its long distance toll rates. In any event,
  6  any in-state connection fee shall be eliminated by March 1,
  7  2004, provided that the timetable approved pursuant to s.
  8  364.164(1)(a) reduces intrastate switched network access rates
  9  in an amount that results in the elimination of the access
10  recovery charge in a revenue-neutral manner. The tariff
11  changes, if any, made by the interexchange telecommunications
12  carrier to carry out the requirements of this subsection shall
13  be presumed valid and become effective on 1 day's notice.
14         (7)  Telecommunications company intrastate switched
15  access and customer long distance rate reductions shall become
16  effective on October 1 of each relevant year.  Rate decreases
17  proposed in tariff revisions filed by the telecommunications
18  companies with the commission shall be presumed valid and
19  become effective on October 1 of each relevant year.
20         (8)  No later than 30 days after the filing of such
21  tariff, the commission may, with respect to determining the
22  correctness of any rate decrease, vote, without hearing, the
23  telecommunications company to hold subject to refund all
24  intrastate switched access or customer long distance rate
25  revenues collected after the rate decrease.  Within 60 days
26  after such order, the commission must make a determination
27  either compelling a refund of the appropriate part of such
28  revenues or releasing all such revenues from such requirement.
29         (3)(9)  The commission shall have continuing regulatory
30  oversight of intrastate switched network access and customer
31  long distance rates for purposes of determining the
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  1  correctness of any rate decrease by a telecommunications
  2  company resulting from the application of s. 364.164 this
  3  section and making any necessary adjustments to those rates,
  4  establishing reasonable service quality criteria, and assuring
  5  resolution of service complaints. Nothing in this subsection
  6  shall be construed to mean that the commission does not have
  7  continuing regulatory oversight of service quality criteria or
  8  the authority to resolve service complaints for all
  9  telecommunications companies subject to this section.
10         Section 3.  Section 364.164, Florida Statutes, is
11  created to read:
12         364.164  Switched network access rate reduction.--
13         (1)(a)  Notwithstanding the provisions of s.
14  364.051(3), effective December 1, 2002, each local exchange
15  telecommunications company with more than 1 million access
16  lines in service shall, for purposes of this section only,
17  establish a revenue category to include both basic local
18  telecommunications service revenues and intrastate switched
19  network access revenues, and it shall notify the commission
20  that it has established this revenue category.  The company's
21  notification to the commission that it has established such
22  revenue category shall include a timetable for reducing the
23  company's intrastate switched network access rates within that
24  revenue category to or below parity.  The commission shall
25  approve such switched network access rate reductions timetable
26  within 60 days after the timetable is filed with the
27  commission, provided the submitted timetable reaches parity or
28  below parity within 2 to 5 years and includes switched network
29  access rate reductions equal in amounts once in any 12-month
30  period.  However, the commission may, only after consultation
31  with the company, adjust the timetable for reducing intrastate
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  1  switched network access rates filed by the company if the
  2  commission finds that it is in the public interest to do so
  3  and so long as the adjusted timetable for reducing intrastate
  4  switched network access rates is within 2 to 5 years and the
  5  intrastate switched network access rate reductions are equal
  6  in amounts and occur once in any 12-month period.
  7         (b)  Notwithstanding the provisions of s. 364.051(2),
  8  effective December 1, 2003, each local exchange
  9  telecommunications company with 1 million or less access lines
10  in service may, for purposes of this section only, establish a
11  revenue category to include both basic local
12  telecommunications service revenues and intrastate switched
13  network access revenues, and shall notify the commission that
14  the revenue category has been established. The company's
15  notification to the commission that it has established such
16  revenue category shall include a timetable for reducing the
17  company's intrastate switched network access service rates
18  within that revenue category to or below parity.  The
19  commission shall approve such switched network access service
20  rate reductions timetable within 60 days after the timetable
21  is filed with the commission, provided the submitted timetable
22  reaches parity or below parity within 2 to 5 years and
23  includes switched network access service rate reductions equal
24  in amounts once in any 12-month period.  However, the
25  commission may, only after consultation with the company,
26  adjust the timetable for reducing intrastate switched network
27  access rates filed by the company if the commission finds that
28  it is in the public interest to do so and so long as the
29  adjusted timetable for reducing intrastate switched network
30  access rates is within 2 to 5 years and the intrastate
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  1  switched network access rate reductions are equal in amounts
  2  and occur once in any 12-month period.
  3         (c)  The revenue category created pursuant to this
  4  section shall not include revenues generated from pay
  5  telephone access lines.
  6         (2)  Upon the commission's approval of the intrastate
  7  switched network access rate reduction timetable, the local
  8  exchange telecommunications company shall thereafter, on 45
  9  days' notice, adjust the various prices and rates of the
10  services within its revenue category authorized by this
11  section once in any 12-month period in a revenue-neutral
12  manner.  All annual rate adjustments within the revenue
13  category established pursuant to this section shall be
14  implemented simultaneously and shall be revenue neutral.  The
15  commission shall, within 45 days after the rate adjustment
16  filing, issue a final order confirming compliance with this
17  section, and such order shall be final for all purposes.
18         (3)  Any filing under this section shall be based on
19  the company's most recent 12 months' pricing units in
20  accordance with subsection (7) for any service included in the
21  revenue category established under this section. The
22  commission shall have the authority only to verify the pricing
23  units for the purpose of ensuring that the company's specific
24  adjustments, as authorized by this section, make the revenue
25  category revenue neutral for each filing.  Any discovery or
26  information requests under this section shall be limited to a
27  verification of historical pricing units necessary to fulfill
28  the commission's specific responsibilities under this section
29  of ensuring that the company's rate adjustments make the
30  revenue category revenue neutral for each annual filing.
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  1         (4)  Nothing in this section shall affect the local
  2  exchange telecommunications company's exemptions pursuant to
  3  s. 364.051(1)(c) or authorize any local exchange
  4  telecommunications company to increase the cost of local
  5  exchange services to any person providing services under s.
  6  364.3375.
  7         (5)  For purposes of this section, "parity" means that
  8  the local exchange telecommunications company's intrastate
  9  switched network access rate is equal to its interstate
10  switched network access rate in effect on January 1, 2002, if
11  the company has more than 4 million access lines in service.
12  If the company has 4 million or less and more than 1 million
13  access lines in service, "parity" means that the company's
14  intrastate switched network access rate is equal to 2 cents
15  per minute.  If the company has 1 million or less access lines
16  in service, "parity" means that the company's intrastate
17  switched network access rate is equal to 8 cents per minute.
18  Nothing in this section shall prevent the company from making
19  further reductions in its intrastate switched network access
20  rate, within the revenue category established in this section,
21  below parity on a revenue-neutral basis, or from making other
22  revenue neutral rate adjustments within this category.
23         (6)  For purposes of this section, "intrastate switched
24  network access rate" means the composite of the originating
25  and terminating network access rate for carrier common line,
26  local channel/entrance facility, switched common transport,
27  access tandem switching, interconnection charge, information
28  surcharge, and local switching.
29         (7)  For purposes of this section, "revenue neutral"
30  means that the total revenue within the revenue category
31  established pursuant to this section remains the same before
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  1  and after the local exchange telecommunications company
  2  implements any rate adjustments under this section.
  3  Calculation of revenue received from each service prior to
  4  implementation of any rate adjustment shall be made by
  5  multiplying the then-current rate for each service by the most
  6  recent 12 months' actual pricing units for each service within
  7  the category, without any adjustments to the number of pricing
  8  units. Calculation of revenue for each service to be received
  9  after implementation of rate adjustments shall be made by
10  multiplying the rate to be applicable for each service by the
11  most recent 12 months' actual pricing units for each service
12  within the category, without any adjustments to the number of
13  pricing units. Billing units associated with Lifeline
14  Assistance Plan service shall not be included in any
15  calculation under this subsection.
16         Section 4.  This act shall take effect upon becoming a
17  law.
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