76R12534 CBH-F
By Counts H.B. No. 2690
Substitute the following for H.B. No. 2690:
By Counts C.S.H.B. No. 2690
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to the acquisition of small and rural telephone exchanges.
1-3 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-4 SECTION 1. Chapter 51, Utilities Code, is amended by adding
1-5 Section 51.011 to read as follows:
1-6 Sec. 51.011. REVIEW OF SALE OR TRANSFER OF CERTAIN
1-7 EXCHANGES. (a) This section applies to a sale or transfer of one
1-8 or more exchanges in which:
1-9 (1) each individual exchange being sold or transferred
1-10 has fewer than 10,000 access lines;
1-11 (2) all exchanges being sold or transferred have a
1-12 total of fewer than 100,000 access lines;
1-13 (3) the company that is selling or transferring the
1-14 exchange or exchanges is a company electing under Chapter 58 or 59;
1-15 and
1-16 (4) the company that acquires the exchange or
1-17 exchanges:
1-18 (A) is a telecommunications utility that is not
1-19 a company electing under Chapter 58 or 59;
1-20 (B) will not own more than 100,000 access lines
1-21 in this state after the acquisition is completed; and
1-22 (C) agrees to:
1-23 (i) not increase the rate for basic local
1-24 telephone service until after the fifth anniversary of the
2-1 acquisition date;
2-2 (ii) set intrastate switched access rates
2-3 at the level charged for interstate switched access by that company
2-4 or by the company selling or transferring the exchange or
2-5 exchanges;
2-6 (iii) include each acquired exchange
2-7 within the commission jurisdiction applicable to the other
2-8 exchanges of the acquiring company; and
2-9 (iv) establish a level of service quality
2-10 and infrastructure that meets or exceeds the service quality
2-11 requirements of the company selling or transferring the exchange or
2-12 exchanges at the time of acquisition.
2-13 (b) If two or more telecommunications utilities jointly
2-14 acquire two or more exchanges with the intent to partition the
2-15 exchanges among the utilities at a later date, this section applies
2-16 if each acquiring utility and the resulting partitioned
2-17 acquisitions meet the requirements prescribed by Subsection (a).
2-18 (c) A telecommunications utility that makes an acquisition
2-19 to which this section applies shall report the acquisition as
2-20 provided by Section 14.101 or 51.010 and may apply to have the
2-21 commission review the acquisition in accordance with this section.
2-22 If the utility makes a joint acquisition as described by Subsection
2-23 (b), the utilities may apply jointly.
2-24 (d) If the commission determines that the acquiring utility
2-25 and the acquisition meet the requirements prescribed by Subsection
2-26 (a), the commission shall approve the transaction and authorize the
2-27 acquiring telecommunications utility to receive universal service
3-1 fund disbursements under Section 56.021(1) for the residual revenue
3-2 requirements necessary for the utility to obtain a rate of return
3-3 equal to the rate of return allowed by the Federal Communications
3-4 Commission for interstate jurisdiction. The revenue requirement
3-5 that would otherwise be considered for the acquiring utility is
3-6 limited only to the extent that the acquiring utility purchased the
3-7 exchange or exchanges above the selling utility's net book value.
3-8 The commission may consider a rate of return above the federal
3-9 level if circumstances justify the higher rate and it is in the
3-10 public interest.
3-11 (e) The commission may approve the review and authorize the
3-12 universal fund disbursements by administrative review.
3-13 SECTION 2. The importance of this legislation and the
3-14 crowded condition of the calendars in both houses create an
3-15 emergency and an imperative public necessity that the
3-16 constitutional rule requiring bills to be read on three several
3-17 days in each house be suspended, and this rule is hereby suspended,
3-18 and that this Act take effect and be in force from and after its
3-19 passage, and it is so enacted.