BILL ANALYSIS
State Affairs Committee
By: Seidlits
April 9, 1995
Committee Report (Substituted)
BACKGROUND
The Public Utility Commission of Texas (PUC) was created in 1975
and is responsible for regulating electric and telephone utilities
in Texas. The key functions of PUC include certifying a utility's
initial operation, reviewing any new construction or changes to
existing facilities, setting rates, and monitoring and auditing the
operations of utilities under its jurisdiction. Currently, PUC has
oversight of investor-owned utilities, electric cooperatives, river
authorities, and local telephone companies. Cities have retained
original ratemaking authority for electric utilities and
cooperatives operating within their boundaries, but the commission
reviews these rates on an appellate basis. The commission also
reviews on appeal the rates of city utilities serving customers
outside of their city limits.
The Office of Public Utility Counsel (OPUC) was created in 1983 to
represent residential and small business consumers before PUC.
OPUC participates in many proceedings before PUC but concentrates
its efforts on telephone and electric utility rate cases having the
greatest impact on residential and small business consumers. OPUC
has participated in major rate cases, but only a percentage of all
cases before PUC since 1983.
The PUC and OPUC are subject to the sunset act and will be
abolished September 1, 1995 unless continued by the legislature.
PURPOSE
The purpose of this bill is to continue the Public Utility
Commission of Texas and the Office of Public Utility Counsel for a
six-year period and make statutory modifications. The
modifications proposed by this bill:
- recognize the changes in the telecommunications industry
that have occurred since the original enactment of the
Public Utility Regulatory Act;
- make provisions for competition in telecommunications
and to reflect intent to protect consumers in
noncompetitive markets, maintain affordable rates and
high quality service, encourage competition, and
maintain regulation commensurate with the degree of
competition;
- grant more rate flexibility to small telephone companies
and partially deregulate telephone cooperatives and
provide safeguards to protect consumers;
- create a certificate of operating authority and a
service provider certificate of operating authority for
new entrants to the telecommunications market to provide
more flexibility in the regulatory environment;
- provide an incentive regulatory structure for electing
local exchange telephone companies that regulates price
not cost of telecommunications services in three baskets
of competitive regulation in return for $1.4 billion in
infrastructure commitments to benefit schools,
libraries, and public hospitals;
- establish a voluntary infrastructure commitment for
small rate of return regulated telecommunications
companies to benefit schools, libraries, and public
hospitals;
- create competitive safeguards to ensure fair competition
and to accelerate improvement of telecommunications by
ensuring that the rates and regulations of the incumbent
local exchange company are not unreasonably
preferential, prejudicial or discriminatory;
- require the commission to develop rules requiring local
exchange companies to share infrastructure and
technology with a requesting local exchange company to
provide services in an area where the local exchange
company is the carrier of last resort;
- establish requirements for the use of specific customer
proprietary network information;
- establish requirements for audio and video programming
and prohibit local exchange companies from providing
audio or video programming in the state;
- establish requirements for advertising agency services
and prohibit local exchange companies from selling
advertising services to nonaffiliates, except activities
that promote or sell telecommunications services and
equipment and promote the use of the network;
- establish requirements for video carriage and require
video programmers and local exchange companies that
transmit video programming or provide access to video
programming through telecommunications services also to
give broadcast stations access to these
telecommunications services;
- establish requirements for audio carriage and require
programmers delivering 12 or more channels of audio
programming on a local exchange company's video dial
tone network to also deliver FCC-licensed radio stations
under certain condition;
- enact prohibitions against local exchange companies
engaging in electronic publishing distributed by
telephone service;
- create the Telecommunications Infrastructure Fund to be
financed by an annual assessment on all
telecommunications providers based on total annual
intrastate receipts. Provide for the Fund to fund
grants and loans to school districts, institutions of
higher education, and libraries recommended by the
Central Education Agency, the Texas Higher Education
Coordinating Board or the State Library and Archives
Commission;
- create the Telecommunications Infrastructure Fund Board
to administer the Telecommunications Infrastructure
Fund;
- authorize PUC to establish rules expanding the Universal
Service Fund for local exchange companies serving fewer
than one million access lines under certain
circumstances;
- create the Regulatory Transition Fund to promote
universal local exchange service where no competition
exists and to facilitate the transition from monopoly
conditions to a competitive market;
- amend Subchapter D, Chapter 74, Property Code by adding
Section 74.3011 to allow a local exchange company with
fewer than 50,000 access lines to deliver funds from
certain abandoned property to a rural scholarship fund
instead of the State Treasury; and
- provide for other changes.
RULEMAKING AUTHORITY
In the committee's opinion, this bill grants rulemaking authority
to the Public Utility Commission in the following sections:
SECTION 6 - Sec. 3.051, Public Utility Regulatory Act of 1995, as
enacted by the 74th Legislature, Regular Session; SECTION 7 - Sec.
3.053; SECTION 9 - Sec. 3.151; SECTION 11 - Sec. 3.1555; SECTION 15
- Sec. 3.211; SECTION 17 - Sec. 3.213, Sec. 3.2135; SECTION 21 -
Sec. 3.2531; SECTION 22 - Sec. 3.2532; SECTION 25 - Sec. 3.2555;
SECTION 26 - Sec. 3.2571; SECTION 27 - Sec. 3.2572; SECTION 30 -
Sec. 3.2595; SECTION 33 - Sec. 3.2615; SECTION 34 - Sec.3.262;
SECTION 35 - Sec. 3.2625; SECTION 41 - SUBTITLE H - Sec. 3.352,
Sec. 3.353, Sec. 3.354, 3.355, Sec. 3.356, Sec. 3.357, SUBTITLE J -
Sec. 3.452, Sec. 3.453, Sec. 3.454, Sec. 3.455, Sec. 3.456, Sec.
3.457, Sec. 3.458, Sec. 3.460, Sec. 3.461, Sec. 3.463, SUBTITLE K -
Sec. 3.501, SUBTITLE L - Sec. 3.559, and SUBTITLE M - Sec. 3.608
and Sec. 3.610. This bill also grants rulemaking authority to the
comptroller, the Texas Higher Education Coordinating Board; and the
Central Education Agency in SECTION 41 - SUBTITLE M - Sec. 3.606;
and the state treasurer in SECTION 42 - Sec. 74.3011, Subchapter D,
Chapter 74, Property Code. In addition, under the general
rulemaking authority already granted to the Public Utility
Commission, rules may also be developed to implement other
provisions found in this bill.
SECTION BY SECTION ANALYSIS
SECTION 1. Amends Section 1.002 Public Utility Regulatory Act of 1995, as enacted by
S.B. 319, Acts of the 74th Legislature, Regular Session, 1995. Changes policy statement to specify
that "traditionally" public utilities are considered monopolies by definition.
SECTION 2. Amends Section 1.003, Subsection (14). Reflects updated references for
definition of utility.
SECTION 3. Amends Section 1.004. Reflects updated references to the content of the
section.
SECTION 4. Amends Section 1.022. Updates the Sunset review date for the Public Utility
Commission and the Office of Public Utility Counsel to 2001, which provides for a six-year review.
SECTION 5. Amends Subtitle A, Title III.
Sec. 3.001. Adds statement of legislative findings regarding changes in competition and
technology in telecommunications and stating the policy of the state to protect consumers in
noncompetitive markets, maintain affordable rates and high quality service, encourage competition,
ensure availability of high quality telecommunications services, and maintain regulation
commensurate with the degree of competition.
Sec. 3.002. Changes definitions. Provides definition of basic local telecommunications
service. Modifies definition of "dominant carrier" to apply to all local exchange companies in
business on September 1, 1995 that offer service with no competition and companies that have
exclusive use of the "1+" intraLATA long distance code within its certificated exchange. Defines
least cost technology, local exchange telephone service, long run incremental cost, pricing flexibility,
and telecommunications provider. Clarifies the definition of public utility.
SECTION 6. Amends Section 3.051, Subsections (a), (c)-(f), (j), and (l)-(q). Adds
Subsections (r) and (s). Adds legislative changes to the list of changes moving the
telecommunications industry towards competition. Modifies the commission's authority over non-dominant carriers to specify "telecommunications utilities" instead of "interexchange carriers" and
regulation of price not cost. Changes terminology to refer to "incumbent" local exchange companies.
Makes holders of certificate of operating authority or service provider certificate of operating
authority subject to PUC's report on the scope of competition, complaint proceedings, and the timely
provision of service within an exchange. Specifies PUC authority over holders of certificate of
operating authority and service provider certificate of operating authority. Limits PUC's authority
to impose a greater regulatory burden on a holder of a certificate of operating authority than it
imposes on a holder of certificate of convenience and necessity.
SECTION 7. Adds Section 3.053. Provides that the commission's investigations of sales and
mergers must be completed and a final order issued within 180 days after notification by utility or
such action shall be deemed in the public interest. Specifies that the reporting requirements do not
apply to electing incumbent local exchange companies or companies with certificates of operating
authority or service provider certificates of operating authority.
SECTION 8. Adds Section 3.1015. Specifies that public utilities may pass along municipal
charges to consumers and that companies that traditionally pass through these charges shall pass
through reductions.
SECTION 9. Amends Section 3.151(a). Requires the commission, upon application by a
utility, to fix depreciation rates that promote technology and infrastructure deployment. Provides
that an electing company may determine its own depreciation rate.
SECTION 10. Adds Section 3.1545. Allows a utility to temporarily remove records from
the state.
SECTION 11. Adds Section 3.1555. Requires utilities to provide basic local telephone
service, at its applicable tariff, to all customers, regardless of race, national origin, income, urban or
rural residence, no later than December 31, 2000. Lists the services required as basic local telephone
service. Authorizes the PUC to temporarily waive these requirements on showing of good cause.
SECTION 12. Amends Sections 3.201 and 3.202. Specifies the PUC's authority to set rates
of public utilities, except as otherwise provided in the Act. Updates reference to current law
regarding the PUC's authority to determine reasonableness of rates.
SECTION 13. Amends Section 3.204. Technical change to current law regarding the burden
of proof on utilities in rate cases to clarify that the burden is on the incumbent local exchange
company.
SECTION 14. Amends Section 3.210, by adding Subsection (c). Specifies that companies
electing incentive regulation or rate of return companies electing an infrastructure plan are exempt
from the PUC's jurisdiction to hear and resolve complaints. Specifies the commission's authority
to hear and resolve complaints regarding the companies' compliance with obligations imposed by
the Act.
SECTION 15. Amends Section 3.211, Subsections (f) and (h), and adds Subsection (j).
Clarifies that electing companies are not subject to the PUC's authority to adjust rates found to be
unreasonable or in violation of the law. Allows incumbent local exchange companies to file with
the commission FCC approved tariffs for interstate switched access that include all rate elements
other than end user charges and requires the PUC, after review, to order rates to be the intrastate
switched access rates.
SECTION 16. Amends Section 3.212, Subsections (a) and (c). Technical change to current
law to clarify that the law applies to the incumbent local exchange company.
SECTION 17. Amends Section 3.213 and adds Section 3.2135. Sec. 3.213. Amends
regulatory policy on small local exchange companies and telephone cooperatives. Establishes
legislative policy regarding incentives and flexibility to allow local exchange companies serving
rural areas to provide existing services and introduce new technology and services.
Allows a cooperative or local exchange company with fewer than 31,000 access lines to offer
extended local calling services or new services on an optional basis or make minor changes in its
rates or tariffs if the company files a statement of intent with the PUC, provides timely notice to
affected customers, and files an affidavit with the PUC.
Provides for commission review of a proposed change if it receives complaints from the
lesser of five percent or 1,500 customers; it receives a complaint from an intrastate access customer
or group of customers accounting for more than 10 percent of the company's total intrastate access
revenues; the change is not a minor change, as defined; the company does not comply with
procedural requirements; or the change is inconsistent with the PUC's substantive policies.
Authorizes the PUC to suspend the proposed tariff during its review.
Deletes existing provisions for cooperatives with fewer than 5,000 access lines to change
rates under specified conditions.
Allows companies to provide board members, officers, employees, and agents free or reduced
rates for services. Requires the PUC to review and revise or eliminate any policies, reporting
requirements, and rules that place unnecessary burdens or expenses on rural and small local
exchange companies and cooperatives. Authorizes the commission to adopt policies that affect a
company's ability to do business. Authorizes the commission to adopt other policies related to small
companies that it considers appropriate.
Extends the PUC's authority to collect fees from local exchange companies to cover the
regulatory costs associated with the partial deregulation of telephone cooperatives. Excludes
partially deregulated cooperatives from the requirements of the section, except for the policy review
provisions.
Sec. 3.2135. Provides for the partial deregulation of telephone cooperatives upon majority
of ballots of membership. Allows the cooperative to offer extended local calling services, optional
new services, or make changes in rates or tariffs if the cooperative provides notice to all customers
and municipalities, files an affidavit with the PUC, and files a statement of intent.
Provides for PUC review of a proposed action if it receives complaints from five percent of
customers or from an intrastate access customer or group of customers accounting for more than 10
percent of the cooperative's intrastate access revenues; the cooperative does not comply with
procedural requirements; or the proposed action is inconsistent with the PUC's substantive policies.
Authorizes the PUC to suspend the actions of the cooperative during the review. Allows for reballot
to reverse the deregulation upon motion of the board of directors or receipt of a written request of
10 percent of members. Requires the PUC to prescribe the voting procedures for an election to
reverse deregulation.
SECTION 18. Adds Section 3.219. Allows an authorized company to continue to receive
"0+" and "1+" intraLATA calls as long as federal law prohibits any local exchange company from
providing interLATA services. Requires the PUC to consider allowing customers to designate a
carrier for "0+" and "1+" intraLATA calls if federal law allows a local exchange company to provide
interLATA services.
SECTION 19. Amends Section 3.251, by adding Subsection (c). Requires persons providing
local exchange service to have a certificate of convenience and necessity, a certificate of operating
authority, or a service provider certificate of operating authority.
SECTION 20. Amends Section 3.252. Specifies that telecommunications utilities do not
need a certificate of operating authority or service provider certificate of operating authority to
provide certain services including interexchange service, non-switched private line service, shared
tenant service, specialized common carrier service, commercial mobile radio service or operator
service.
SECTION 21. Adds Section 3.2531. Provides that certificates of operating authority may
be granted by the commission. Requires the application to specify whether the applicant is seeking
a facilities-based certificate of operating authority or a service provider certificate of operating
authority and establishes procedures for the PUC to follow in granting certificates. Requires
applicants for facilities-based a certificate of operating authority to provide a plan to deploy facilities
throughout the certificated service area over a six-year period. Allows the PUC to issue rules
concerning the time-frame for providing service except that the service must be provided within 30
days of a customer request and the PUC may not require drop facilities on every customer's premise
in advance of a request. Requires a ten percent build out by the end of the first year; 50 percent build
out after three years; and 100 percent build out after six years with a maximum of 40 percent of the
applicant's service area that may be served by the resale of the incumbent local exchange company's
facilities. Prohibits the use of CMRS to meet build-out requirements, but allows PCS wireless
technology.
Requires the PUC to issue a certificate of operating authority within 60 days of application,
and allows for an extension for good cause. Requires certificates to be granted on a
nondiscriminatory basis after consideration of factors including technical and financial qualifications
and ability to meet quality of service requirements. Specifies additional factors for the PUC to
consider in exchanges with fewer than 31,000 lines. Establishes reporting requirements with PUC
and authorizes PUC to waive compliance with the six-year build-out plan for good cause. Specifies
that the boundaries of a certificate of operating authority's area must have a minimum 3-mile radius
except for specified conditions.
Prohibits the PUC from granting a certificate of operating authority before September 1, 1998
in an exchange of a local exchange company with fewer than 31,000 access lines. Authorizes the
PUC to waive build-out requirements for additional applicants six years after a certificate of
operating authority has been granted for an area or when an applicant has completed the required
build out.
Authorizes the PUC to determine, in its consideration of applications for certificates of
operating authority filed after September 1, 1997, if the build-out requirements have created barriers
to entry of facilities-based competition and the effect of resale provisions on competition.
Authorizes the PUC to relax the build-out requirements to a two-mile radius or a 50 percent
maximum permitted resale if it determines such barriers to competition exist.. Authorizes PUC to
take enforcement action for failure to comply with requirements of the Act including revocation of
the certificate or administrative penalties.
SECTION 22. Adds Section 3.2532. Authorizes the PUC to grant service provider
certificates of operating authority to certain businesses able to provide services in the proposed
service area and limits eligible companies to those with no more than four percent of the total
intrastate switched access market. Specifies that a certificate holder may obtain services by resale
and limits the uses for that resale. Provides that incumbent local exchange companies may not delay
provision of services or degrade the quality of access provided. Defines affiliate and control for this
section.
SECTION 23. Amends Section 3.255, Subsections (a) and (b). Changes language to reflect
"certificated" utilities and not just those with certificates of convenience and necessity that may
provide certain services.
SECTION 24. Amends Sections 3.256 and 3.257. Changes language to apply provisions
relating to the enforceability of contracts and commission orders preliminary to issuance of
certificates to "telecommunications" utilities instead of "public" utilities.
SECTION 25. Adds Section 3.2555. Requires applicants for certificates of operating
authority and for service provider certificates of operating authority to file a statement that they have
applied for all required municipal permits. Prohibits municipalities from discriminating against
telecommunications utilities in relation to public right-of-ways, building access, and pole
attachments. Prohibits property owners from discriminating against utilities in relation to
installations on owner's property to provide service to tenants or discriminate against tenants because
of the utility from which the tenants receive services. Authorizes the PUC to investigate complaints.
SECTION 26. Adds Section 3.2571. Requires the PUC, after granting a certificate of
operating authority, to establish a transitional flexibility plan for incumbent local exchange company
in the same area as the new certificate holder. Specifies that basic local telecommunications service
price of the local exchange company may not be increased for four years, except as provided by the
Act or when the applicant has completed the required build out.
SECTION 27. Adds Section 3.2572. Provides that the commission may grant price
deregulation of specific services in particular areas if it determines the local exchange company or
holder of a certificate of operating authority is not dominant to that specific service in that particular
area.
Requires the PUC to consider certain factors in determining dominance or non-dominance
of a local exchange company or holder of certificate of operating authority, including the degree of
effective competition, lack of market power to control price, number and size of telecommunication
utilities, ability of customers to obtain equivalent service, ability of utilities to make service
available, and proportion of relevant market served by competitor. Authorizes the PUC to reassert
regulation if local exchange company or certificate holder again becomes dominant and authorizes
the PUC to conduct investigations and collection information subject to confidentiality safeguards.
Allows parties to use results of PUC investigations in applications for pricing flexibility.
SECTION 28. Amends Section 3.258, Subsection (a). Requires holders of a certificate of
convenience and necessity or a certificate of operating authority to offer all basic local
telecommunications services to any customer in its certified area, and clarifies that holder of
certificate of convenience and necessity is the provider of last resort.
SECTION 29. Amends Section 3.259. Adds references to certificate of operating authority
and service provider certificate of operating authority to provisions relating to the refusal to provide
certain prohibited services.
SECTION 30. Adds Section 3.2595. Provides for the discontinuation of an optional service
or the ceasing of operations by a telecommunications utility holding a certificate of operating
authority or service provider certificate of operating authority.
SECTION 31. Amends Section 3.260. Adds reference to a telecommunications utility and
certificate of operating authority relating to the sale or lease of its certificate.
SECTION 32. Amends Section 3.261. Updates language so that PUC's authority to prevent
a utility from interfering with another utility applies to "telecommunications" instead of "public"
utilities.
SECTION 33. Adds Section 3.2615. Requires companies providing local exchange service
to negotiate for printed directory listings and directory assistance in overlapping certificated areas.
Authorizes PUC to resolve disputes.
SECTION 34. Amends Section 3.262. Changes current law regarding PUC's authority to
order service improvements to provide that two companies may be ordered to provide optional
extended area service within a specified calling area if jointly agreed to by the companies and
political subdivisions under certain circumstances.
SECTION 35. Adds Section 3.2625. Limits the rights of pay telephone providers to set
provider rates and charges and limits the commission's authority over pay telephone service rates
of incumbent LECs. Provides that providers may not impose on end users any charge for local
directory assistance, or state or local emergency communication calls. Requires PUC to adopt rules
requiring the registration of pay telephone providers and authorizes PUC to adopt rules regarding
information to be posted on a pay telephone. Provides enforcement authority to PUC for violations
of its rules.
SECTION 36. Amends Section 3.263, Subsection (a). Adds reference to certificate of
operating authority and service provider certificate of operating authority to PUC's revocation
authority.
SECTION 37. Amends Section 3.302, by adding Subsection (i). Authorizes commercial
radio mobile service (CRMS) to offer caller identification service.
SECTION 38. Amends Section 3.303. Changes terminology to refer to the "incumbent"
local exchange company in the provision regarding rates by local exchange companies for
interexchange telecommunications services.
SECTION 39. Amends Section 3.304, Subsections (a) and (b). Amends current law
regarding toll-free calling areas to limit requests by petitioning exchanges to expansion to no more
than five exchanges. Updates references to the "incumbent" local exchange company.
SECTION 40. Adds Section 3.308. Requires LECs serving more than one million access
lines to file with PUC to reduce monthly rates for separately-charged mandatory two-way extended
area service to $3.50 per line for residential customers and $7.00 per line for business customers.
Provides for recovery of costs and loss of revenue. Exempts PUC and local exchange companies
from this requirement if the charge is for extended area service in or into a metropolitan exchange
or is for extended metropolitan service
SECTION 41. Amends Subtitles H and I, and adds Subtitles J-N.
Sec. 3.351. States the policy of the legislature to provide for the orderly transition from
traditional rate of return regulation to a fully competitive marketplace for telecommunications
providers, to preserve universal service, to upgrade telecommunications infrastructure, and to
promote network interconnectivity and diversity in telecommunications services.
Sec. 3.352. Adds a provision allowing incumbent local exchange companies to elect to
undergo incentive regulation subject to the company's commitment to limit rate increases for certain
basic network services for four years and the commitment to provide telecommunications
infrastructure. Classifies incentive regulation in three baskets of services and authorizes the
commission to reclassify services between the baskets. Specifies that electing companies shall be
regulated under incentive regulation regardless of a determination of dominance.
Exempts incumbent local exchange companies electing incentive regulation from complaints,
determinations as to the reasonableness of basic network service rates, and overall revenues and
return on invested capital or net income during the four-year election period with the exception that
consumers may complain about quality of service and ambiguity of tariffs.
Sec. 3.353. Establishes Basket I services as basic network services and provides a listing of
those services. Provides for rate increases for Basket I services only with commission approval for
four years following election resulting from specified exogenous factors: Federal Communications
Commission changes in separations affecting intrastate net income; a commission reviewed change
due to changed market conditions and effects of competitive entry for companies with fewer than
five million access lines; increases permitted under regulatory transition fund provisions; and rate
group reclassifications because of growth in access lines.
Requires commission approval for changes to terms and conditions of the tariffs of a basic
network service, other than price changes. Provides that rates capped as a result of a company's
election are the rates charged on June 1, 1995 without regard to pending proceedings. Allows an
electing company with more than one million access lines to spend the value of an income tax-related issue resolved against the company on its infrastructure commitment.
Sec. 3.354. Establishes procedures for adjusting rates for basic network services, including
notice requirements, commission review, costing provisions for local exchange companies with five
percent or less of the state's access lines, and commission hearings and orders.
Sec. 3.355. Establishes Basket II services as discretionary services that have not been granted
pricing flexibility and not listed under Baskets I or III and provides a listing of those services.
Authorizes the commission to reclassify services between baskets according to established criteria.
Provides for pricing Basket II services by the commission above the LRIC with a ceiling at
the rate in effect on September 1, 1995. Provides for raising the ceiling only after proceedings
required to assure competitive safeguards. Limits the commission's authority to change the ceiling
thereafter to no more than 10 percent annually.
Sec. 3.356. Establishes Basket III services as competitive services and provides a listing of
those services. Authorizes the commission to reclassify services between the baskets according to
established criteria.
Allows an electing company to price competitive services anywhere above the service's
LRIC, but prohibits price increases in areas where the service is not readily available from another
provider. Requires the commission to review incentive regulation and report to the legislature by
January 1, 2000 regarding consumer benefits, impact of competition, infrastructure investments, and
quality of service.
Sec. 3.357. Requires the commission to establish standards for transferring services between
baskets, including availability of the service from other providers, proportion of the market receiving
the service, effect of the transfer on subscribers, and nature of the service. Prohibits the commission
from transferring any service until implementation of competitive safeguards.
Sec. 3.358. Requires companies electing incentive regulation to invest in
telecommunications infrastructure. Requires the investment to be made during the six years
following election and specifies network enhancements and special discount rates available to
schools, libraries, and public or not-for-profit hospitals or primary health care providers. Requires
an electing company with five million access lines or more to provide requesting schools or libraries
in exchanges in which toll-free access to the Internet is not available to provide such access.
Requires large electing companies to prioritize investments in rural areas, areas designated as
critically medically or educationally underserved, and schools with high percentages of economically
disadvantaged students. Provides that an electing company with between one and five million access
lines may include as an infrastructure investment any investments and expenses incurred in providing
digital switching central offices in exchanges having fewer than 20,000 access lines incurred after
September 1, 1995 and before December 31, 1998.
Requires electing companies with five million access lines or more to invest $1.1 billion over
the six year period and requires a plan for investing that amount or providing the unspent balance
to the "Telecommunications Infrastructure Fund." Requires electing companies with one million to
five million access lines to invest $300 million over the six year period and requires a plan for
investing that amount or providing the unspent balance to the "Telecommunications Infrastructure
Fund."
Provides definitions for distance learning and telemedicine customer groups. Provides
reporting requirements with the PUC regarding the infrastructure commitment of electing companies.
Sec. 3.401. Establishes legislative policy that companies not electing incentive regulation
should have incentives to deploy infrastructure.
Sec. 3.402. Allows local exchange companies with less than five percent of the state's access
lines that have not elected incentive regulation to elect for an infrastructure plan. Provides a six-year
period in which electing companies shall not seek a rate increase, except for the charges related to
the expansion of toll-free calling areas and, with commission approval, specified exogenous factors:
Federal Communications Commission changes in separations affecting intrastate net income and rate
group reclassifications because of growth in access lines.
Exempts local exchange companies electing an alternative infrastructure plan from any
complaint or hearing as to the reasonableness of basic network services rates, overall revenues,
return on invested capital or net income for six years after the election date if it complies with the
infrastructure commitment with the exception of the company's implementation of competitive
safeguards and the ability of consumers to complain about quality of service and ambiguity of tariffs.
Shields electing companies from complaints that a rate is excessive and prohibits the PUC from
increasing service standards requiring a specified increased investment.
Allows a company to withdraw its election for good cause. Allows local exchange
companies to elect for incentive regulation at any time and provides for any infrastructure
commitment made as a rate of return company to offset any infrastructure commitment required for
companies electing incentive regulation. Provides that rates capped as a result of a company's
election are the rates charged on the election date without regard to pending proceedings.
Sec. 3.403. Requires rate of return companies electing an infrastructure plan to invest in
telecommunications infrastructure. Requires investment over a six years period after election and
specifies network enhancements and special rates available to schools, libraries, and public or not-for-profit hospitals or primary health care providers. Specifies an infrastructure investment
obligation of 15 percent of the company's intrastate revenues in the year of election.
Requires a plan for investing the infrastructure obligation or providing the unspent balance
to the "Telecommunications Infrastructure Fund." Specifies that infrastructure commitment must
be in addition to the company's average annual capital investment over the three years preceding
election, and allows the commission to determine that extraordinary expenditures justify using a
different method for qualifying investment. Provides reporting requirements with the PUC regarding
a company's infrastructure commitment
Sec. 3.451. Adds provisions relating to competitive safeguards. Requires the PUC to ensure
that the rates and regulations of an incumbent local exchange company are not unreasonably
preferential, prejudicial or discriminatory.
Sec. 3.452. Requires a local exchange company to unbundle its network to the extent ordered
by FCC. Requires the PUC to hold a hearing and promulgate an order on the issue of further
unbundling before adopting pricing rules, after considering the public interest and competitive merits
and authorizes the PUC to proceed by rulemaking or evidentiary hearing. Authorizes the PUC to
assign unbundled components to the appropriate Basket.
Sec. 3.453. Requires a local exchange company serving one million access lines or more or
electing incentive regulation to file a usage sensitive loop resale tariff by September 1, 1995.
Requires other local exchange companies also to file a resale tariff within 60 days of receiving a
certificate of operating authority.
Defines "loop" resale as the purchase of the local distribution channel or "loop" facility from
the local exchange company for resale to end user customers. Requires the commission to conduct
proceedings to determine the rates, terms and conditions for this tariff. Prescribes the PUC' actions
only to approve a usage sensitive rate that recovers the total long run incremental cost of the loop
on an unseparated basis, plus an appropriate contribution to joint and common costs; and to permit
holders of certificates of convenience and necessity, operating authority or service provider
certificate of operating authority to purchase from the resale tariff with certain exceptions.
Prohibits a telecommunications provider from restricting resale of service for which it is not
a dominant provider or for competitive services contained in Basket III. Establishes the reciprocal
obligation on holders of certificates of operating authority to resell loop facilities to the local
exchange company that has no facilities and has received a request for service. Requires the PUC
to eliminate resale prohibitions in local exchange company tariffs under certain conditions.
Sec. 3.454. Requires the PUC to adopt rules and establishes imputation as a regulatory policy
to prevent the incumbent local exchange company from selling a service to another utility at a higher
price than it implicitly includes in service to its retail customers. Limits the PUC to requiring
imputation only of the price of a service that is not generally available from other sources and that
is necessary for competitors. Prevents the commission from requiring imputation of the price of a
local exchange service while the price is capped. Prevents the commission from requiring
imputation on a rate-element-by-element basis but only on a service-by-service basis. Provides that
the commission may waive imputation of 9-1-1 and dual party relay service if the commission
determines that the waiver is in the public interest.
Sec. 3.455. Requires the commission to adopt guidelines governing number portability and
competitively neutral number assignments. Defines number portability as the ability of customers
to keep an existing telephone number when changing service providers. Allows the commission to
adopt interim mechanisms. Specifies timelines for the filing of tariffs and actions by the commission
to determine reasonable rates to be charged for call forwarding functions used as an interim number
portability measure by a new entrant.
Sec. 3.456. Requires the commission to adopt rules for expanded interconnection that are
consistent with FCC rules and regulations, treat intrastate private line services as special access
service, and provide that each company must provide expanded interconnection.
Sec. 3.457. Requires the commission to complete a pricing rulemaking and adopt a pricing
rule by April 1, 1997. Requires the PUC to ensure that monopoly services remain affordable;
competitive services are not unreasonably preferential, subsidized by non-competitive services, or
predatory or anticompetitive; and that each service recovers the cost of facilities used to provide that
service.
Sec. 3.458. Defines interconnection. Requires the commission to require all providers to
maintain interoperable networks and, in absence of mutually agreed compensation rates, each carrier
shall reciprocally terminate each others' traffic at no charge for nine months. Requires the
commission to complete proceedings to establish reciprocal interconnection rates, terms and
conditions. Permits a local exchange company to adopt interconnection rates approved for larger
local exchange companies. Establishes that the commission has exclusive jurisdiction.
Sec. 3.459. Provides that a local exchange company shall not unreasonably: refuse access
to the local exchange; refuse or delay interconnections; degrade the quality of access; impair the
speed, quality, or efficiency of lines used by competitors; fail to disclose necessary design
information; or refuse access to competitors.
Sec. 3.460. Authorizes the PUC to establish procedures for these policies but not to adopt
rules contrary to federal laws.
Sec. 3.461. Mandates that these obligations do not apply to local exchange companies
serving less than 31,000 access lines until after September 1, 1998. Provides that the commission
may modify these rules if in the public interest.
Sec. 3.462. Provides that the commission may review the implementation of provisions
regarding unbundling, imputation, and cost and pricing to be applicable to local exchange companies
not applied to on request from a holder of a certificate of operating authority.
Sec. 3.463. Requires PUC to develop regulations requiring local exchange companies to
share infrastructure and technology with a requesting local exchange company to enable the
requesting company to provide services in an area where the local exchange company is the carrier
of last resort. Provides guidelines for regulations for infrastructure sharing.
Sec. 3.501. Establishes requirements for the use of "specific customer proprietary network
information" (specific CPNI). Prohibits telecommunications utilities from using specific CPNI for
commercial purposes other than the sale of telecommunications or enhanced services. Allows the
use of specific CPNI with customer's consent and allows specific CPNI to be provided to an affiliate
telecommunications provider. Requires PUC to adopt rules regarding CPNI that meet specified
criteria, but specifies that rules may not be more burdensome than federal rules on local exchange
companies with 100,000 or fewer access lines.
Sec. 3.502. Establishes requirements for audio and video programming. Prohibits local
exchange companies from providing audio or video programming in the state, but allows separate
corporate affiliate of a local exchange company to provide audio or video programming under
specified conditions imposed on the affiliate and on the local exchange company. Requires an
independent compliance audit on a local exchange company every three years. Limits PUC's
jurisdiction over affiliates providing audio and video programming and exempts local exchange
companies with 100,000 or fewer access lines. Authorizes PUC to waive these requirements for
requesting companies after considering the need for the restriction in the market involved.
Sec. 3.503. Establishes requirements for advertising agency services. Prohibits local
exchange companies from selling advertising services to nonaffiliates, except activities that promote
or sell telecommunications services and equipment and promote the use of the telecommunications
network. Allows separate corporate affiliate of a local exchange company to engage in advertising
activities under certain conditions imposed on the affiliate and the local exchange company.
Exempts local exchange companies with 100,000 or fewer access lines. Authorizes PUC to waive
these requirements for a requesting company after considering the need for the restriction in the
market involved
Sec. 3.504. Establishes requirements for video carriage. Requires video programmers and
local exchange companies that transmit video programming or provide access to video programming
through telecommunications services also to give broadcast stations access to these
telecommunications services. Requires programmers using a video dial tone network of a local
exchange company to provide up to six full-power, FCC-licensed television stations in every market
and up nine television stations in the largest markets in the state. Requires television stations
seeking carriage to grant retransmission consent to the programmer and the local exchange company
Limits PUC's jurisdiction over affiliates which are video programmers and exempts local
exchange companies with 100,000 or fewer access lines. Authorizes PUC to waive the requirements
for a requesting company after considering the need for the restriction in the market involved.
Provides for the expiration of these requirements on August 31, 1999.
Sec. 3.505. Establishes requirements for audio carriage. Requires a programmer which
delivers 12 or more channels of audio programming on a local exchange company's video dial tone
network to also deliver FCC-licensed radio stations under certain conditions. Requires radio stations
seeking carriage to grant retransmission consent to the programmer and the local exchange company.
Limits PUC's jurisdiction over affiliates which are video programmers and exempts local
exchange companies with 100,000 or fewer access lines. Authorizes PUC to waive the requirements
for a requesting company after considering the need for the restriction in the market involved.
Provides for the expiration of these requirements on August 31, 1999.
Sec. 3.506. Specifies that broadcaster safeguards related to CPNI, audio and video
programming, advertising, and video and audio carriage do not apply to cable companies.
Sec. 3.551. Provides definitions relating to electronic publishing, including definitions of
"affiliate," "separated affiliate," "electronic publishing joint venture," "incumbent local exchange
company," "basic telephone service," "electronic publishing" and a listing of exclusions from the
definition of electronic publishing.
Sec. 3.552. Prohibits local exchange companies or an affiliate from providing electronic
publishing distributed by basic telephone service. Specifies authority of separated affiliates and
electronic publishing joint ventures to provide electronic publishing and authority of local exchange
companies and affiliates to provide electronic publishing that is not distributed by their basic
telephone service.
Sec. 3.553. Specifies requirements on separated affiliates and electronic publishing joint
ventures regarding the provision of electronic publishing.
Sec. 3.554. Specifies requirements on local exchange companies under common ownership
with a separated affiliate or electronic publishing joint venture regarding the provision of electronic
publishing.
Sec. 3.555. Prohibits a local exchange companies or affiliate from providing customer
proprietary network information (CPNI) to electronic publishers, including separated affiliates and
joint ventures, that use the local exchange company's telephone service unless the information is
made available to all publishers on equal terms.
Sec. 3.556. Prohibits collusion between local exchange companies and affiliates and other
entities to knowingly and wilfully evade electronic publishing requirements.
Sec. 3.557. Clarifies authority of affiliates to invest dividends derived from a local exchange
company in its separated affiliate.
Sec. 3.558. Prohibits local exchange companies from carrying out any promotion, marketing,
sales, or advertising for a separated affiliate or an affiliate related to provision of electronic
publishing, except for specifically authorized joint activities.
Sec. 3.559. Authorizes joint activities, including inbound telemarketing, teaming
arrangements, and joint ventures, by local exchange companies and separated affiliates, electronic
publishing joint ventures, affiliates, unaffiliated electronic publishers, and other entities.
Sec. 3.560. Imposes requirements on transactions between a local exchange company and
an affiliate related the provision of electronic publishing.
Sec. 3.561. Imposes requirements on transactions between an affiliate and a separated
affiliate relating to provision of electronic publishing.
Sec. 3.562. Imposes employment restrictions on local exchange companies with regard to
other electronic publishing businesses, and prohibits certain transactions, except as specifically
authorized.
Sec. 3.563. Establishes a private right of action for persons claiming a violation of the
electronic publishing requirements by a local exchange company, affiliate, or separated affiliate.
Sec. 3.564. Clarifies the supremacy of antitrust laws with regard to electronic publishing
requirements.
Sec. 3.565. Provides a one-year transition period for local exchange companies or affiliates
providing electronic publishing to comply with new requirements.
Sec. 3.566. Establishes a June 30, 2001 expiration for these electronic publishing
requirements.
Sec. 3.601. Renumbers section regarding PUC rulemaking authority for "tel-assistance
service."
Sec. 3.602. Renumbers section regarding eligibility for tel-assistance service.
Sec. 3.603. Renumbers section regarding the reduction on telephone bills for persons
receiving tel-assistance service.
Sec. 3.604. Renumbers section regarding telecommunications relay access service for the
hearing-impaired and speech-impaired.
Sec. 3.605. Renumbers section regarding distance learning activities by educational
institutions and reduced rates.
Sec. 3.606. Establishes the Telecommunications Infrastructure Fund Board to administer the
Telecommunications Infrastructure Fund. Specifies the appointment, terms, and qualifications of
the nine-member board and requires the governor to appoint the presiding officer. Makes the board
subject to Sunset review in 2001. Authorizes the board to employ personnel necessary to perform
its duties.
Provides for the fund to be financed by an annual assessment on all telecommunications
providers based on total annual intrastate receipts. Requires the comptroller to assess and collect $75
million from telecommunications providers for FY 1996 and each of the following five fiscal years.
Establishes reporting requirements for telecommunications providers and specifies that
amounts collected and deposited into the state treasury are designated solely for use by the board for
the purposes specified and are not subject to funds consolidation. Requires the comptroller to issue
warrants as requested by the board from funds appropriated to the board. Authorizes the board to
accept gifts, grants, and donations. Requires the board to use the fund to award grants and loans to
school districts, institutions of higher education, and public libraries recommended by the Central
Education Agency, the Texas Higher Education Coordinating Board or the State Library and
Archives Commission and specifies criteria for awarding grants and loans.
Sec. 3.607. Renumbers section regarding recovering lost revenue from providing tel-assistance service from the universal service fund.
Sec. 3.608. Authorizes PUC to establish rules expanding the Universal Service Fund for
local exchange companies serving fewer than one million access lines under certain circumstances
relating to regulatory actions that increase costs or decrease revenues. Specifies that a revenue
requirement showing is not required for disbursements for the Universal Service Fund and that
disbursements be made promptly to avoid cash flow changes resulting from these government
changes.
Specifies that all telecommunications "providers," instead of "utilities," that have access to
the customer base must pay into the Universal Service Fund. Establishes minimum eligibility
criteria for local exchange companies to serve every consumer within its certified area. Authorizes
PUC to require reporting by local exchange companies and other telecommunications providers to
assess contributions to the fund.
Sec. 3.609. Renumbers section regarding the provision of interactive multimedia
communications services.
Sec. 3.610. Establishes the Regulatory Transition Fund (RTF) as a fund outside the state
treasury to promote universal local exchange service where no competition exists and to facilitate
the transition from monopoly conditions to a competitive market.
Provides for the RTF to be funded by an assessment on billed retail revenues of all
telecommunications providers, except for local exchange companies deciding not to receive RTF
funds and telecommunications providers in the same area. Specifies that no assessment shall be
made on local exchange service revenues. Requires the RTF to be administered by PUC and
specifies actions by PUC to collect and transfer funds so that telecommunications providers and local
exchange companies do not experience cash flow changes resulting from the replacement of access
revenues with RTF revenues.
Authorizes telecommunications providers to collect the assessment through a surcharge on,
or increased rates to, their retail customers, except for local exchange service, as provided elsewhere.
Allows local exchange companies to opt out of the fund.
Requires local exchange companies receiving RTF funds on July 1, 1996 to price intrastate
switched access rates at the level of interstate switched access rates as of January 1, 1995. Provides
for local exchange companies to reprice intrastate intraLATA toll rates. Requires PUC to disburse
RTF funds on a revenue neutral basis to local exchange companies to offset any revenue reduction
from the change in access rates and intraLATA toll. Allows PUC to assess additional amounts to
telecommunications providers to fund any revenue reductions caused by price changes required by
PUC in proceedings under its long run incremental cost rule.
Requires PUC to establish rules to reduce RTF receipts for a local exchange company's area
based on criteria relating to the availability of services from a new provider. Authorizes PUC to
restructure rates in the fourth and fifth year after the change in access rates and intrastate intraLATA
toll rates. Specifies that a revenue requirement showing is not required for disbursements from the
RTF.
Sec. 3.611. Renumbers section regarding severability of RTF provisions.
Sec. 3.651. Renumbers section regarding definitions for automatic dial announcing devices
(ADADs).
Sec. 3.652. Renumbers section regarding exemptions from ADAD requirements.
Sec. 3.653. Renumbers section regarding requirements for operation of ADADs. Exempts
ADADs used by a live operator for debt collection from requirement to announce certain information
about the call in the first 30 seconds of the call.
Sec. 3.654. Renumbers section regarding investigation of complaints involving ADADs.
Sec. 3.655. Renumbers section regarding application for ADAD permits.
Sec. 3.656. Renumbers section regarding penalties for violations of ADAD requirements.
Sec. 3.657. Renumbers section regarding revocation of ADAD permits.
Sec. 3.658. Renumbers section regarding rulemaking authority for ADADs.
Sec. 3.659. Renumbers section regarding consumer requests not be called by telephone
solicitor.
Sec. 3.660. Renumbers section regarding notice of consumers' rights and updates other
Section reference.
SECTION 42. (a) Amends Subchapter D, Chapter 74, Property Code, by adding Section
74.3011. Allows a local exchange company with fewer than 50,000 access lines to deliver funds
from certain abandoned property to a rural scholarship fund instead of the State Treasury. Provides
for paying claims for money delivered to a scholarship fund and requires the state treasurer to
develop procedures relating to notice of presumed abandoned property, delivery of money to the
scholarship fund, and filing of claims.
(b) Specifies that this section applies only to money required to be delivered to the state
treasurer on or after the effective date.
SECTION 43. Specifies implementation provisions for initial appointment of
Telecommunications Infrastructure Fund Board.
SECTION 44. Repeals laws in conflict with this Act on September 1, 1995.
SECTION 45. (a) Provides a September 1, 1995 effective date of Act.
(b) Specifies that provisions relating to certificate of operating authority and service provider
certificate of operating authority apply only to contracts entered into or amended on or after
September 1, 1995.
(c) Specifies that provisions relating to expansion of toll free calling areas apply only to
petitions for which PUC has not issued a final order as of April 15, 1995.
SECTION 46. Emergency clause.
COMPARISON OF ORIGINAL TO SUBSTITUTE
Major points of difference between CSHB 2128 and the original bill are as follows:
1. Adds a provision not contained in original version to make holders of certificate of operating
authority or service provider certificate of operating authority subject to PUC's report on the
scope of competition, complaint proceedings, and the timely provision of service within an
exchange.
2. Adds a provision not contained in original version authorizing companies electing incentive
regulation to determine their own depreciation rates and amortizations and to notify PUC of
changes.
3. Adds language to the requirement for holders of certificates of convenience and necessity and
certificates of operating authority to provide minimum services in a way that does not
discriminate on basis of race, national origin, income or location in an urban or rural area.
4. Adds a provision not contained in original version authorizing the PUC to issue rules for
when a holder of certificates of operating authority must be able to serve customers.
Specifies that certificate holders must be able to serve customers in their build-out area
within 30 days of a customer request and that the PUC may not require certificate holders to
have drop facilities on every customers' premises before the customer request.
5. Changes the limitation on resale contained in the original version from 30 to 40 percent of
the facilities that an applicant for a certificate of operating authority can provide by resale of
a local exchange company's facilities.
6. Adds a provision not in the original version authorizing the PUC, on applications for a
certificate of operating authority after September 1, 1997, to determine if build-out
requirements have created barriers to entry of facilities-based competition and the effect of
resale provisions on competition. Authorizes the PUC to relax build-out requirements to a
two-mile radius or a 50 percent maximum permitted resale if it determines existing
requirements have created barriers to competition.
7. Adds provisions not in the original version regarding service provider certificate of operating
authority. Specifies that a company is not eligible to obtain a certificate if it has more than
four percent of the total intrastate switched access market and requires the PUC to certify
eligibility. Deletes provision in original bill defining a service provider as a small
telecommunications business with annual revenues less than $10 million. Allows
certificate holders to obtain services by resale and limits the uses for that resale. Prohibits
certain actions by the local exchange company, including delaying provision of services or
degrading the quality of access provided.
8. Changes the amount of a set use fee for "1-800" calls from pay telephones from 50 in the
original version to 25 cents and imposes additional requirements on pay telephone providers
regarding the set use fee. Excludes an incumbent local exchange company from the
prohibition against charging higher than published rates for credit card or operator-handled
calls and specifies that published rates stay in effect until changed by the legislature.
9. Adds language not in the original version to limit petitions for expanding toll-free calling
boundaries to no more than five exchanges.
10. Deletes language in the original version that would have allowed the commission to increase
rates for basic network services for certain exogenous factors, including changes in federal
income tax rates, mandated changes in financial accounting, and mandated changes in basic
telecommunications service standards.
11. Adds language not contained in the original version to allow an electing company with more
than one million access lines to spend the value of an income tax-related issue on its
infrastructure commitment if any pending proceeding is resolved against the company.
12. Adds language not contained in the original version to allow an electing company with more
than one million and fewer than five million access lines to include investments and
expenses incurred in providing digital switching central offices in exchanges with fewer than
20,000 access lines as a part of its infrastructure commitment if the investments are incurred
before December 1, 1998 and after September 1, 1995.
13. Changes language in the original version regarding the infrastructure commitment by local
exchange companies electing incentive regulation. Replaces the transmission speeds for
broadband service that customers may request from a floor to a ceiling of 45 megabits per
second. Deletes criminal justice facilities, including courthouses, from the list of customers
who may request infrastructure investment.
14. Changes language in the original version establishing the priority for infrastructure
investment to include areas that are rural areas or medically or educationally underserved,
and schools with high percentages of economically disadvantaged students. The original bill
had established priorities based on county population levels and school district size.
15. Changes a provision contained in the original version to require the PUC to adopt a pricing
rule for monopoly and competitive service prices by April 1, 1997. The original version had
required the PUC to adopt the rule within 180 days of receipt of required cost studies unless
specific waivers are authorized.
16. Deletes a provision in the original version establishing an interim reciprocal interconnection
rate of 1.1 cent per minute of use for terminating local intraexchange traffic of another local
exchange company or certificate holder that originates and terminates in this state.
Establishes a nine-month period in which each carrier reciprocally terminates each other's
traffic at no cost and during which tine the PUC shall establish the reciprocal interconnection
rate.
17. Adds provision not in original version specifying that broadcaster safeguards related to
consumer proprietary network information, audio and video programming, advertising, and
video and audio carriage do not apply to cable companies.
18. Changes the effective date from July 1, 1996 to July 1, 1997 for local exchange companies
receiving Regulatory Transition Funds to price intrastate switched access rates at the level
of interstate switched access rates as of January 1, 1995. Adds language not in the original
version specifying that the Fund is established outside the state treasury.
SUMMARY OF COMMITTEE ACTION
Pursuant to public notice posted on March 15, 1995, HB 2128 was considered by the Committee on
State Affairs in a public hearing on March 20, 1995. The Chair laid out HB 2128 and recognized
Rep. Seidlits to explain the bill. The following persons testified for the bill: Calvin Weinheimer
representing the Texas Telephone Association; Jim Whitefield representing the President of the
Texas Statewide Telephone Cooperative, Inc.; Brad Streit representing Texas Association of
Broadcasters; Ann Arnold representing Texas Association of Broadcasters; Brita D. Martin-Lindsey
representing herself; Ceola Curley III representing himself; Chidozie Drake representing himself;
David Cole representing Southwestern Bell; Paula Kay Montoya representing Texas Association of
Mexican American Chambers of Commerce; Anthony J. Trujillo representing himself; Royce J.
Holland representing himself; J. Ron Cross representing Northern Telecom Inc.; Don Simons
representing himself; John Mitchell representing himself; Jo Nell Knight representing herself; Karen
D. Sitton representing herself; and Hubert Daugherty representing himself. The following persons
testified against the bill: Phillip L. Gaddy representing AT&T; Pres Sheppard representing himself;
W. Gray Bryant representing AT&T; Ray Marshall representing AT&T; and James Henry Sturges
representing US One Communications Corp. The following persons testified neutrally on the bill:
Peter Stapp representing Tele-Communications, Inc.; Ellen A. D'Amato representing Sprint Long
Distance; Walter Washington representing the Office of the Public Utility Counsel; Thomas J.
Morrow representing Time-Warner Communications; Robert W. Gee representing the Public Utility
Commission of Texas; Patrick Wood, III representing himself; Sarah Goodfriend representing
herself; and Steve Tolen representing The Colony, TX. The Chair left HB 2128 pending. HB 2128
was considered by the Committee on State Affairs in a public hearing on March 21, 1995. The Chair
laid out HB 2128. The following persons testified for the bill: David Cole representing
Southwestern Bell; Joseph Cosgrove representing Southwestern Bell; Ron Harris representing
ACSEC 911 & Collin County; Francis Fisher representing himself; Elizabeth Crabb representing the
Texas Library Association; Joe D. Gunn representing Workers of Texas; and D.L. Dally Willis
representing the CWA Union. The following persons testified against the bill: Janee Briesemeister
representing Consumers Union; Neal R. Larsen representing MCI Telecommunications Corp;
Rayford Price representing US One Communications Corp; and Melvin Reams representing himself.
The following persons testified nuetrally on the bill: Bill Magness representing the Communications
Coalition; Kenneth F. Melley representing Texaltel; Jep Hill representing the Texas ISDN User's
Group; Charles D. Land representing himself; Richard E. Burk representing himself; Madelon
Kuchera representing Teleport Communications Group. The Chair left HB 2128 pending. HB 2128
was considered by the Committee on State Affairs in a public hearing on April 5, 1995. The Chair
laid out HB 2128. The following persons testified for the bill: Joseph E. Cosgrove, Jr. representing
Southwestern Bell Telephone Company; David Cole representing Southwestern Bell Telephone
Company; Oscar C. Gomez representing GTE Southwest Incorporated; Janis D. Everhart
representing herself. The follwoing persons testified neutrally on the bill: Walter Washington
representing the Office of Public Utility Counsel; Patrick Henry Wood, III; Roland L. Curry
representing the Public Utility Commission of Texas. The committee considered a complete
substitute for the bill. 24 amendments were offered to the substitute (and one amendment to the
amendment). 12 of those amendments were adopted without objection. An amendment to one of
those amendments was tabled by a record vote of 13 ayes, 2 nayes, 0 pnv, 0 absent. This amendment
was then also adopted without objection. One of those amendments was adopted by a record vote
of 9 ayes, 2 nayes, 0 pnv, 4 absent. One of those amendments was tabled by a record vote of 12 ayes,
1 nay, 0 pnv, 2 absent. One of those amendments was tabled by a record vote of 13 ayes, 2 nayes,
0 pnv, 0 absent. 8 of those amendments were withdrawn. The substitute as amended was adopted
without objection. The Chair directed the staff to incorporate the amendments into the substitute.
The bill was reported favorably as substituted with the recommendation that it do pass and be
printed, by a record vote of 15 ayes, 0 nay, 0 pnv, 0 absent.