| (A) Category 1. A rate of return of more than three
percentage points below the FCC rate of return;
(B) Category 2. A rate of return within two percentage
points above or three percentage points below the FCC rate of return;
and
(C) Category 3. A rate of return of more than two percentage
points above the FCC rate of return.
(4) Commission staff will file a memorandum for the
commission's consideration of the categorization of each small ILEC
in accordance with paragraph (1)(B) of this subsection.
(g) Treatment of small ILECs based on rate of return
categories. Each category of ILEC will be processed as set forth below.
(1) Category 1 - A small ILEC that has a reported or
commission staff adjusted rate of return in Category 1 may file an
application for an adjustment to have its annual Small and Rural Incumbent
Local Exchange Company Universal Service Plan support or basic rates
increased to a level that would allow the small ILEC to earn an amount
that would be considered a reasonable rate of return, except that
the adjustment may not set a small ILEC's support level at more than
140 percent of the annualized support the provider received in the
12-month period before the date of the adjustment. Any rate adjustments
may not adversely affect universal service.
(2) Category 2 - A small ILEC that has a reported or
commission staff adjusted rate of return in Category 2 will be considered
to be earning a reasonable rate of return and will not be eligible
to file for an adjustment to its Small and Rural Incumbent Local Exchange
Company Universal Service Plan support, except as described in subsection
(h)(2)(B) of this section. The commission may not initiate a proceeding
against a small ILEC that has a reported or commission staff adjusted
rate of return within Category 2.
(3) Category 3 - For a small ILEC that has a reported
or commission staff adjusted rate of return in Category 3, the commission
staff may initiate a proceeding to review and adjust the small ILEC's
Small and Rural Incumbent Local Exchange Company Universal Service
Plan support or basic rates to adjust the small ILEC's rate of return
into the reasonable rate of return range. A small ILEC that has a
commission staff adjusted rate of return in Category 3 is not eligible
to file for an adjustment to its Small and Rural Incumbent Local Exchange
Company Universal Service Plan support, except as described in subsection
(h)(2)(B) of this section.
(h) Contested case procedures.
(1) Documents to be submitted. At a minimum, the following
information must be provided by a small ILEC in a contested case proceeding,
regardless of whether such case is initiated by a small ILEC or commission
staff. Any proceeding filed under this section in which a party has
intervened and requested a hearing is a case initiated by a small
ILEC or commission staff and the filing requirements listed below
apply to such cases.
(A) all the data required by subsections (e) and (f)
of this section;
(B) responses to commission staff's requests for information
in connection with the review of each small ILEC's annual report;
(C) the requested Small and Rural Incumbent Local Exchange
Company Universal Service Plan support or rate adjustments; and,
(D) testimony and workpapers necessary to support the
requested adjustments.
(2) Qualification for contested case proceeding.
(A) Category 1 small ILECs. A small ILEC in Category
1, as identified in subsection (f)(3) of this section, may file an
application that is eligible for administrative review or informal
disposition to request an adjustment to its Small and Rural Incumbent
Local Exchange Company Universal Service Plan or basic rates to allow
the company to earn a reasonable rate of return.
(B) Category 2 or Category 3 small ILECs subsequent
to rate of return adjustment by commission staff. A small ILEC that
has a reported rate of return in Category 1 or Category 2, as identified
in subsection (f)(3) of this section, but that has a commission staff
adjusted rate of return in Category 2 or Category 3, may file a petition
to contest the commission staff adjusted rate of return and may also
request an adjustment to its Small and Rural Incumbent Local Exchange
Company Universal Service Plan support or basic rates in the same
proceeding. A small ILEC that has a reported rate of return in Category
2 but because of commission staff adjustments the small ILEC is in
Category 3, may file a petition to contest the commission staff adjustments.
However, the small ILEC may not request an adjustment to its Small
and Rural Incumbent Local Exchange Company Universal Service Plan
support or basic rates. Any proceeding that is initiated by a small
ILEC to protest a reclassification and in which a party has intervened
and requested a hearing is a case initiated by a small ILEC and the
filing requirements listed below apply to these cases.
(C) Category 3 small ILECs. A small ILEC in Category
3, as identified in subsection (f)(3) of this section, is subject
to a commission staff initiated proceeding to review the company's
annual report and reported rate of return, must submit the information
listed in paragraph (1) of this subsection.
(3) Notice. Each small ILEC that files a contested
case proceeding will provide notice as required by §22.55 of
this title (relating to Notice in Other Proceedings). At a minimum,
notice will be published in the Texas Register and will be provided
to the Office of Public Utility Counsel. Each Category 1 small ILEC
that files an application under this section must provide notice to
its customers that the company may be required to increase its rates
as part of the adjustment to have its annual Small and Rural Incumbent
Local Exchange Company Universal Service Plan support increased.
(4) Burden of proof. A small ILEC will bear the initial
burden of production and the burden of persuasion.
(5) Timing for contested cases. The commission will
grant or deny an application filed under subsection not later than
120 days after the date a sufficient application is filed. The commission
may extend the deadline upon a showing of good cause. The application
will be processed in accordance with the commission's rules applicable
to docketed cases.
(6) Timing to file a subsequent contested case. Once
the commission issues an order in a contested case under this section,
the small ILEC and commission staff may not file a subsequent contested
case before the third anniversary of the date on which the small ILEC's
most recent application for adjustment is initiated, unless good cause
is proven.
(i) Confidentiality of information.
(1) A report or information that a small ILEC is required
to provide to the commission under subsection (e) of this section
is confidential and not subject to disclosure under Chapter 552, Government
Code.
(2) A third party may only access confidential information
filed according to subsection (h) of this section, or a proceeding
related to that filing, if the third party is subject to an appropriate
protective order.
(3) This subsection does not apply to a subsequent
contested case initiated under subsection (h) of this section, and
no claim of confidentiality will arise from this subsection in such
a subsequent contested case.
(j) Commission adjustment of the small ILEC's revenue
requirement and Small and Rural Incumbent Local Exchange Company Universal
Service Plan support.
(1) Revised revenue requirements.
(A) In a proceeding conducted in accordance with subsection
(h) of this section, the commission will determine the small ILEC's
new revenue requirement necessary to allow the company to earn a reasonable
rate of return; however, the commission may not set a small ILEC's
support level at more than 140 percent of the annualized support the
small ILEC received in the 12-month period before the date of the
adjustment, nor may the rate adjustment adversely affect universal
service.
(B) A small ILEC that is in Category 1 cannot request
an increase in the Small and Rural Incumbent Local Exchange Company
Universal Service Plan support that would result in a rate of return
greater than the minimum of the reasonable rate of return. In a proceeding
for a small ILEC in Category 3, a small ILEC or commission staff may
not request a decrease in the Small and Rural Incumbent Local Exchange
Company Universal Service Plan support that would result in a rate
of return greater than the maximum reasonable rate of return.
(2) Small and Rural Incumbent Local Exchange Company
Universal Service Plan (SRIUSP) support payments to small ILECs. The
commission will determine the amount of adjustment to the annual SRIUSP
support or basic rates for the small ILEC that will be needed to meet
the new revenue requirement identified in this paragraph. The commission
will determine the fixed monthly support payment for a small ILEC
by dividing the SRIUSP support by 12. Each small ILEC that has SRIUSP
support adjusted under this section must provide the TUSF administrator
with a copy of the final order Cont'd... |
