House Bill hb1683er
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2002 Legislature CS/HB 1683, First Engrossed
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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; providing for
14 notification; amending s. 364.163, F.S.;
15 revising provisions relating to caps on rates;
16 deleting provisions relating to recovery of
17 costs of government programs; revising
18 provisions relating to rate changes; providing
19 for adjustments in long distance revenues and
20 pass-through to customers; maintaining
21 continuing oversight by the commission;
22 creating s.364.164, F.S.; providing findings;
23 providing for petition to the commission for
24 reduction of access rates; providing for final
25 order; providing for criteria; providing for
26 establishment of revenue category mechanisms;
27 providing for notification; providing for
28 revenue neutrality; providing for notice;
29 providing limitations on adjustments; providing
30 for pricing units; maintaining exemptions;
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2002 Legislature CS/HB 1683, First Engrossed
1 providing definitions; providing an effective
2 date.
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4 Be It Enacted by the Legislature of the State of Florida:
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6 Section 1. Subsection (3) is added to section 364.10,
7 Florida Statutes, to read:
8 364.10 Undue advantage to person or locality
9 prohibited; exception.--
10 (3)(a) Any local exchange telecommunications company
11 authorized by the commission to reduce its switched network
12 access rate pursuant to s. 364.164, shall, effective March 31,
13 2003, have tariffed and shall provide Lifeline Assistance Plan
14 service to any otherwise eligible customer or potential
15 customer who meets an income eligibility test at 125 percent
16 or less of the federal poverty income guidelines for Lifeline
17 Assistance Plan customers. Such test for eligibility shall
18 augment, rather than replace, the eligibility standards
19 established by federal law and based on participation in
20 certain low-income assistance programs. Each interexchange
21 telecommunications carrier shall, effective March 31, 2003,
22 file a tariff providing, at a minimum, the interexchange
23 telecommunications carrier's current Lifeline Assistance Plan
24 benefits and exemptions to Lifeline Assistance Plan customers
25 who meet the income eligibility test set forth in this
26 subsection. The Office of Public Counsel shall serve as the
27 state agency which certifies and maintains claims submitted by
28 a customer for eligibility under the income test authorized by
29 this subsection.
30 (b) Each local exchange telecommunications company
31 subject to this subsection shall provide each state and
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2002 Legislature CS/HB 1683, First Engrossed
1 federal agency that provides benefits to persons that are
2 eligible for the Lifeline Assistance Plan service with
3 applications, brochures, pamphlets, or other materials which
4 inform such persons of their eligibility for the Lifeline
5 Assistance Plan service, and each state agency providing such
6 benefits shall furnish such materials to affected persons at
7 the time such persons apply for benefits.
8 (c) Any local exchange telecommunications company
9 customer receiving Lifeline Assistance Plan benefits shall not
10 be subject to any residential basic local telecommunications
11 service rate increases authorized by s. 364.164 until such
12 time as the local exchange telecommunications company reaches
13 parity as defined in s. 364.164(6) or until the customer no
14 longer qualifies for the Lifeline Assistance Plan benefits
15 established by this section or s. 364.105, or unless otherwise
16 determined by the commission upon petition by a local exchange
17 telecommunications company.
18 (d) Each agency that provides benefits to persons that
19 are eligible for the Lifeline Assistance Plan service shall,
20 by December 31, 2002, notify each such person by postcard of
21 his or her eligibility for the Lifeline Assistance Plan
22 service, together with the name of the local exchange
23 telecommunications company. The direct cost of this postcard
24 production and mailing shall be paid by the local exchange
25 telecommunications companies with more than one million access
26 lines in service. The commission shall report to the
27 Governor, the Speaker of the House of Representatives and the
28 President of the Senate by December 31st of each year on the
29 number of customers who are subscribing to Lifeline Assistance
30 Plan service.
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2002 Legislature CS/HB 1683, First Engrossed
1 Section 2. Section 364.163, Florida Statutes, is
2 amended to read:
3 364.163 Network access services.--For purposes of this
4 section, "network access service" is defined as any service
5 provided by a local exchange telecommunications company to a
6 telecommunications company certificated under this chapter or
7 licensed by the Federal Communications Commission to access
8 the local exchange telecommunications network, excluding the
9 local interconnection arrangements in s. 364.16 and the resale
10 arrangements in s. 364.161. Each local exchange
11 telecommunications company subject to s. 364.051 shall
12 maintain tariffs with the commission containing the terms,
13 conditions, and rates for each of its network access services.
14 (1) Effective January 1, 1999, the rates for switched
15 network access services of each company subject to this
16 section shall be capped at the rates in effect on January 1,
17 1999, and shall remain capped until January 1, 2001. Upon the
18 date of filing its election with the commission, the network
19 access service rates of a company that elects to become
20 subject to this section shall be capped at the rates in effect
21 on that date and shall remain capped for 5 years.
22 (1)(2) After the termination of the caps imposed on
23 rates by subsection (1) and after a local exchange
24 telecommunications company's intrastate switched network
25 access rates are reduced to or below reach parity, as defined
26 in s. 364.164(6), the company's intrastate switched network
27 access rates shall be capped and shall remain capped for 3
28 years thereafter. with its interstate switched access rates, a
29 company subject to this section may, on 30 days' notice,
30 annually adjust any specific network access service rate in an
31 amount not to exceed the cumulative change in inflation
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1 experienced after the date of the last adjustment, provided,
2 however, that no such adjustment shall ever exceed 3 percent
3 annually of the then-current prices. Inflation shall be
4 measured by the changes in Gross Domestic Product Fixed 1987
5 Weights Price Index, or successor fixed weight price index,
6 published in the Survey of Current Business, or successor
7 publication, by the United States Department of Commerce.
8 (3) After the termination of the caps imposed on rates
9 by subsection (1), a company subject to this section may, at
10 any time, petition the commission for a network access service
11 rate change to recover the cost of governmentally mandated
12 projects or programs or an increase in federal or state income
13 tax incurred after that date. The costs and expenses of the
14 government program or project required in part II of this
15 chapter shall not be recovered under this subsection unless
16 such costs and expenses are incurred in the absence of a bid
17 and subject to carrier of last resort obligations as provided
18 for in part II of this chapter. With respect to
19 governmentally mandated projects and programs, such petition
20 shall be acted upon no later than 90 days after the date of
21 filing. A company subject to this section shall show the
22 commission that the cost of a project or program is not
23 recoverable either from the government mandating the project
24 or program or from the beneficiaries of the project or program
25 through user fees or other new revenue sources from the
26 project or program, and to the extent that cost decreases
27 resulting from the project or program are reflected as an
28 offset to cost increases. A company subject to this section
29 shall decrease its network access rates by amounts that
30 reflect any federal or state income tax reduction. Nothing
31 contained in this section shall allow any revisions in the
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1 rates, terms, and conditions for commercial mobile radio
2 service access, which revisions are inconsistent with the
3 requirements or methodologies of the Federal Communications
4 Commission.
5 (4) A company subject to this section may choose to
6 implement all or a portion of a rate increase allowed for
7 network access service by subsections (1), (2), and (3).
8 Notwithstanding subsections (1), (2), and (3), a company
9 subject to this section may choose to decrease network service
10 rates at any time, and decreased rates shall become effective
11 upon 7 days' notice.
12 (5) company-proposed changes to the terms and
13 conditions for existing network access services in accordance
14 with subsections (1), (2), (3), and (4) shall be presumed
15 valid and become effective upon 15 days' notice.
16 company-proposed rate reductions shall become effective upon 7
17 days' notice. Rate increases made by the local exchange
18 telecommunications company shall be presumed valid and become
19 effective on the date specified in the tariff, but in no event
20 earlier than 30 days after the filing of such tariff. The
21 commission shall have continuing regulatory oversight of local
22 exchange telecommunications company-provided network access
23 services for purposes of determining the correctness of any
24 price increase resulting from the application of the inflation
25 index and making any necessary adjustments, establishing
26 reasonable service quality criteria, and assuring resolution
27 of service complaints. No later than 30 days after the filing
28 of such tariff, the commission may, with respect to
29 determining the correctness of any price increase, vote,
30 without hearing, the local exchange telecommunications company
31 to hold subject to refund all revenues collected under the
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1 rate increase. Within 60 days after such order, the commission
2 must make a determination either compelling a refund of all or
3 part of such revenues or releasing them from such requirement.
4 (2)(6) Any local exchange telecommunications company
5 with more than 100,000, but fewer than 3 million, basic local
6 telecommunications service access lines in service on July 1,
7 1995, shall reduce its intrastate switched access rates by 5
8 percent on July 1, 1998, and by 10 percent on October 1, 1998.
9 Any interexchange telecommunications carrier company whose
10 intrastate switched network access rate is reduced as a result
11 of the rate adjustments decreases made by a local exchange
12 telecommunications company in accordance with s. 364.164 this
13 subsection shall decrease its intrastate long distance
14 revenues rates by the amount necessary to return the benefits
15 of such reduction to both its residential and business
16 customers but shall not reduce per minute intra-LATA toll
17 rates by a percentage greater than the per minute intrastate
18 switched access rate reductions required by this act. The
19 interexchange telecommunications carrier may determine the
20 specific intrastate rates to be decreased, provided that
21 residential and business customers benefit proportionally from
22 the rate decreases. Subject to the foregoing, any
23 interexchange telecommunications carrier that charges an
24 in-state connection fee shall use any decrease in the
25 intrastate switched network access rate reductions required by
26 s. 364.164 to first eliminate that fee before it reduces its
27 long distance toll rates. In any event, any in-state
28 connection fee shall be eliminated by March 1, 2004, provided
29 that the timetable approved pursuant to s. 364.164(2) reduces
30 intrastate switched network access rates in an amount that
31 results in the elimination of the access recovery charge in a
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2002 Legislature CS/HB 1683, First Engrossed
1 revenue-neutral manner. The tariff changes, if any, made by
2 the interexchange telecommunications carrier to carry out the
3 requirements of this subsection shall be presumed valid and
4 become effective on 1 day's notice.
5 (7) Telecommunications company intrastate switched
6 access and customer long distance rate reductions shall become
7 effective on October 1 of each relevant year. Rate decreases
8 proposed in tariff revisions filed by the telecommunications
9 companies with the commission shall be presumed valid and
10 become effective on October 1 of each relevant year.
11 (8) No later than 30 days after the filing of such
12 tariff, the commission may, with respect to determining the
13 correctness of any rate decrease, vote, without hearing, the
14 telecommunications company to hold subject to refund all
15 intrastate switched access or customer long distance rate
16 revenues collected after the rate decrease. Within 60 days
17 after such order, the commission must make a determination
18 either compelling a refund of the appropriate part of such
19 revenues or releasing all such revenues from such requirement.
20 (3)(9) The commission shall have continuing regulatory
21 oversight of intrastate switched network access and customer
22 long distance rates for purposes of determining the
23 correctness of any rate decrease by a telecommunications
24 company resulting from the application of this section and s.
25 364.164, and making any necessary adjustments to those rates,
26 establishing reasonable service quality criteria, and assuring
27 resolution of service complaints. Nothing in this subsection
28 shall be construed to mean that the commission does not have
29 continuing regulatory oversight of service quality criteria or
30 the authority to resolve service complaints for all
31 telecommunications companies subject to this section.
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1 Section 3. Section 364.164, Florida Statutes, is
2 created to read:
3 364.164 Switched network access rate reduction.--
4 (1) The Legislature finds the following:
5 (a) Residential local exchange competition is in the
6 best interest of Florida and its telecommunications consumers;
7 (b) Residential basic local telecommunications service
8 prices are, on average, below cost, being subsidized with
9 revenues from other services including switched network access
10 charges;
11 (c) The intrastate switched network access charges
12 paid by interexchange telecommunications companies in Florida
13 are above cost and are higher than the interstate switched
14 network access charges which such companies pay to the same
15 local exchange telecommunications companies in Florida;
16 (d) The subsidization of residential basic local
17 telecommunications service prices with revenues from
18 intrastate switched network access charges is inhibiting the
19 development of residential basic local exchange service
20 competition;
21 (e) Restructuring the prices for residential basic
22 local telecommunications service and intrastate switched
23 network access closer to the cost of providing these services
24 should promote local and long distance competition; and
25 (f) The Florida Public Service Commission is the
26 appropriate body to determine whether intrastate switched
27 network access charges and basic local telecommunications
28 service prices will be adjusted in a manner which is revenue
29 neutral to the local exchange telecommunications company and
30 beneficial to residential consumers.
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1 (2) Each local exchange telecommunications company
2 with more than 1 million access lines in service may, after
3 December 1, 2002, petition the commission to reduce its
4 intrastate switched network access rates in a revenue neutral
5 manner. Any local exchange telecommunications company with 1
6 million or less access lines in service may, after December 1,
7 2003, petition the commission to reduce its intrastate
8 switched network access rates in a revenue neutral manner.
9 The commission shall issue its final order granting or denying
10 any petition filed pursuant to this section within 90 days.
11 The commission shall grant the petition if it finds that
12 granting the petition:
13 (a) Will result in switched network access rate
14 reductions that will be implemented during a period to be
15 determined by the commission, but such period shall not be
16 less than 2 years or more than 5 years;
17 (b) Will benefit residential consumers by reducing or
18 eliminating the subsidy to residential basic local
19 telecommunications service rates provided by intrastate
20 switched network access rates;
21 (c) Will move intrastate switched network access rates
22 to parity;
23 (d) Will create a more favorable competitive
24 environment;
25 (e) Will be revenue neutral to the local exchange
26 telecommunications company as set forth in subsection (3); and
27 (f) Will result in benefits to toll customers.
28 (3) In the event the commission grants the local
29 exchange telecommunications company's petition, the local
30 exchange telecommunications company is authorized, the
31 requirements of s. 364.051(3) notwithstanding, to immediately
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1 implement a revenue category mechanism consisting of basic
2 local telecommunications service revenues and intrastate
3 switched network access revenues, to achieve revenue
4 neutrality. The local exchange telecommunications company
5 shall thereafter, on 45 days' notice, adjust the various
6 prices and rates of the services within its revenue category
7 authorized by this section once in any 12-month period in a
8 revenue neutral manner. In no event shall any adjustment in
9 rates be offset entirely by the monthly recurring rate for
10 basic local telecommunications service. All annual rate
11 adjustments within the revenue category established pursuant
12 to this section shall be implemented simultaneously and shall
13 be revenue neutral. The commission shall, within 45 days
14 after the rate adjustment filing, issue a final order
15 confirming compliance with this section, and such order shall
16 be final for all purposes.
17 (4) Any filing under this section shall be based on
18 the company's most recent 12 months' pricing units in
19 accordance with subsection (8) for any service included in the
20 revenue category established under this section. The
21 commission shall have the authority only to verify the pricing
22 units for the purpose of ensuring that the company's specific
23 adjustments, as authorized by this section, make the revenue
24 category revenue neutral for each filing. Any discovery or
25 information requests under this section shall be limited to a
26 verification of historical pricing units necessary to fulfill
27 the commission's specific responsibilities under this section
28 of ensuring that the company's rate adjustments make the
29 revenue category revenue neutral for each annual filing.
30 (5) Nothing in this section shall affect the local
31 exchange telecommunications company's exemptions pursuant to
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1 s. 364.051(1)(c) or authorize any local exchange
2 telecommunications company to increase the cost of local
3 exchange services to any person providing services under s.
4 364.3375.
5 (6) For purposes of this section, "parity" means that
6 the local exchange telecommunications company's intrastate
7 switched network access rate is equal to its interstate
8 switched network access rate in effect on January 1, 2002, if
9 the company has more than 4 million access lines in service.
10 If the company has 4 million or less and more than 1 million
11 access lines in service, "parity" means that the company's
12 intrastate switched network access rate is equal to 2 cents
13 per minute. If the company has 1 million or less access lines
14 in service, "parity" means that the company's intrastate
15 switched network access rate is equal to 8 cents per minute.
16 Nothing in this section shall prevent the company from making
17 further reductions in its intrastate switched network access
18 rate, within the revenue category established in this section,
19 below parity on a revenue-neutral basis, or from making other
20 revenue neutral rate adjustments within this category.
21 (7) For purposes of this section, "intrastate switched
22 network access rate" means the composite of the originating
23 and terminating network access rate for carrier common line,
24 local channel/entrance facility, switched common transport,
25 access tandem switching, interconnection charge, information
26 surcharge, and local switching.
27 (8) For purposes of this section, "revenue neutral"
28 means that the total revenue within the revenue category
29 established pursuant to this section remains the same before
30 and after the local exchange telecommunications company
31 implements any rate adjustments under this section.
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1 Calculation of revenue received from each service prior to
2 implementation of any rate adjustment shall be made by
3 multiplying the then-current rate for each service by the most
4 recent 12 months' actual pricing units for each service within
5 the category, without any adjustments to the number of pricing
6 units. Calculation of revenue for each service to be received
7 after implementation of rate adjustments shall be made by
8 multiplying the rate to be applicable for each service by the
9 most recent 12 months' actual pricing units for each service
10 within the category, without any adjustments to the number of
11 pricing units. Billing units associated with Lifeline
12 Assistance Plan service shall not be included in any
13 calculation under this subsection.
14 Section 4. This act shall take effect upon becoming a
15 law.
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