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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