| (a) Application. The provisions of this section apply
to an incumbent local exchange company (ILEC). This section does not
apply to a deregulated company holding a certificate of operating
authority or to an exempt carrier under PURA §52.154.
(b) Purpose. The purpose of this section is to establish
procedures for pricing flexibility for services subject to competition
and a process for commission review of pricing flexibility applications.
(c) Pricing flexibility.
(1) Eligible services. An ILEC may request the types
of pricing flexibility established by this subsection.
(A) Banded rates. If an ILEC is granted the authority
to charge banded rates, the minimum rates must yield revenues that
are equal to or greater than 105% of the long run incremental cost
of the service in the geographic market in which the service will
be provided.
(i) When an ILEC is granted the authority to charge
banded rates, the ILEC must file a tariff showing the minimum and
maximum rates and specifying its current rate. The current rate specified
in the ILEC's tariff must be applied uniformly to all customers of
the service in each exchange for which the commission has approved
banded rates.
(ii) If the ILEC desires to charge a rate different
from its current rate, but between the minimum and maximum rates,
it must file a revised tariff on or before the effective date of the
rate change.
(iii) The minimum and maximum rates may only be changed
as provided for in the Public Utility Regulatory Act, Chapter 53,
Subchapters C and D, or G.
(B) Detariffing. If an ILEC is granted the authority
to detariff a service, the ILEC must maintain at the commission a
current price list for the service, and the commission must retain
authority to regulate the quality, terms and conditions of the detariffed
service, other than rates. The commission may determine the appropriate
ratemaking treatment of any revenues from or costs of providing a
detariffed service in a proceeding under the Public Utility Regulatory
Act, Chapter 53, Subchapters C and D, or G.
(C) Other types of pricing flexibility. If an ILEC
is granted the authority to engage in a type of pricing flexibility
that the commission finds to be in the public interest other than
those specified in subparagraphs (A) - (B) of this paragraph, that
pricing flexibility must be offered under such terms and conditions
as the commission orders.
(2) Other services. ILECs have the authority to enter
into customer-specific contracts for those services specified in subsection
(d) of this section. For those services, ILECs may apply for pricing
flexibility for the services specified in paragraph (1) of this subsection,
other than customer-specific contracts. For other services, ILECs
may apply to the commission in accordance with this subsection to
obtain any type of pricing flexibility specified in paragraph (1)
of this subsection. Nothing in this subsection permits an ILEC to:
(A) obtain pricing flexibility for basic local telecommunications
service, including local measured service, or for any service that
includes as a component a service not subject to significant competitive
challenge; or
(B) enter into customer-specific contracts or to obtain
detariffing with respect to message telecommunications services, switched
access services, or wide area telecommunications service.
(3) Requirements for application. An application for
pricing flexibility filed under this paragraph must:
(A) include a statement of the ILEC's intention to
use the procedures established in this subsection;
(B) specify the type of pricing flexibility requested
and, if the type of pricing flexibility requested is either banded
rates or some other type of pricing flexibility in accordance with
paragraph (1)(C) of this subsection that involves rate-setting;
(i) state the proposed rates, and if the type of pricing
flexibility is banded rates, state the maximum and minimum rates;
(ii) include detailed documentation demonstrating that
the minimum rates yield revenues that are equal to or greater than
105% of the long run incremental cost of the service in the geographic
market in which the service will be provided;
(iii) demonstrate that the rates are not unreasonably
preferential, prejudicial or discriminatory;
(iv) demonstrate that the rates are such that the service
identified in accordance with to subparagraph (C) of this paragraph
will not be subsidized directly or indirectly by regulated monopoly
services; and
(v) demonstrate that the rates are not predatory or
anticompetitive;
(C) identify the service for which the ILEC is requesting
pricing flexibility, including each component of the service, and
provide functional and technical descriptions of the service, including:
(i) the functions that the service is intended to perform
for the customer;
(ii) the types of equipment used to provide the service
(including, but not limited to, transmission facilities, switching
facilities, customer equipment, software functions, and protocol);
(iii) the network configurations used to provide the
service; and
(iv) schematics;
(D) identify each service that is not subject to significant
competitive challenge but that, at the time the ILEC files its application
for pricing flexibility, the ILEC intends to provide as a tariffed
adjunct to the service identified in subparagraph (C) of this paragraph
and, for each such service, provide:
(i) functional and technical descriptions; and
(ii) citations to the tariff provisions under which
each such service will be provided;
(E) designate each exchange as to which the ILEC is
seeking pricing flexibility;
(F) include a map or maps of each exchange designated
in accordance with subparagraph (E) of this paragraph that can be
coordinated with the official commission boundary maps;
(G) describe the products or services known to the
ILEC that are currently available in each exchange designated in accordance
with subparagraph (E) of this paragraph, and that are the same, equivalent,
or substitutable for the service identified in accordance with subparagraph
(C) of this paragraph, and identify the providers of those products
or services;
(H) with respect to the products or services described
in accordance with subparagraph (G) of this paragraph, discuss:
(i) the number and size of telecommunications utilities
or other persons providing such products or services;
(ii) the extent to which such products or services
are available;
(iii) the ability of customers to obtain such products
or services at rates, terms, and conditions comparable to those that
the ILEC will offer;
(iv) the ability of telecommunications utilities or
other persons to make such products or services readily available
at rates, terms, and conditions comparable to those that the ILEC
will offer; and
(v) the existence of any significant barrier to the
entry or exit of a provider of such products or services;
(I) demonstrate that the level of competition with
respect to all components of the ILEC's service identified in accordance
with subparagraph (C) of this paragraph represents a significant competitive
challenge within each exchange designated in accordance with subparagraph
(E) of this paragraph that warrants the pricing flexibility specified
in accordance with subparagraph (B) of this paragraph;
(J) demonstrate that the service identified in accordance
with subparagraph (C) of this paragraph is not basic local telecommunications
service, including local measured service;
(K) if the type of pricing flexibility requested in
accordance with subparagraph (B) of this paragraph is customer-specific
pricing or detariffing, demonstrate that the service identified in
accordance with subparagraph (C) of this paragraph is not message
telecommunications service, switched access service, or wide area
telecommunications service;
(L) to prevent the subsidization of the service identified
in accordance with subparagraph (C) of this paragraph with revenues
from regulated monopoly services, propose mechanisms to recover costs
that may not be identified and recovered in a long run incremental
cost study, including but not limited to costs associated with advertising,
unsuccessful bids, and all items of plant used in the provision of
the service;
(M) identify and address the impact that approval of
the application for pricing flexibility may have on universal service;
Cont'd... |
