By: Sibley, Fraser S.B. No. 560
A BILL TO BE ENTITLED
AN ACT
1-1 relating to the regulation of telecommunications utilities by the
1-2 Public Utility Commission of Texas and the provision of
1-3 telecommunications services.
1-4 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-5 SECTION 1. Section 12.005, Utilities Code, is amended to
1-6 read as follows:
1-7 Sec. 12.005. APPLICATION OF SUNSET ACT. The Public Utility
1-8 Commission of Texas is subject to Chapter 325, Government Code
1-9 (Texas Sunset Act). Unless continued in existence as provided by
1-10 that chapter, the commission is abolished and this title expires
1-11 September 1, 2005 [2001].
1-12 SECTION 2. Section 52.102, Utilities Code, is amended to
1-13 read as follows:
1-14 Sec. 52.102. LIMITED REGULATORY AUTHORITY. Except as
1-15 otherwise provided by this subchapter and Subchapter D, Chapter 55,
1-16 the commission has only the following jurisdiction over a
1-17 telecommunications utility subject to this subchapter:
1-18 (1) to require registration under Section 52.103;
1-19 (2) to conduct an investigation under Section 52.104;
1-20 (3) to require the filing of reports as the commission
1-21 periodically directs;
1-22 (4) to require the maintenance of statewide average
1-23 rates or prices of telecommunications service;
1-24 (5) to require access to telecommunications service
2-1 under Section 52.105; [and]
2-2 (6) to require the quality of telecommunications
2-3 service provided to be adequate under Section 52.106; and
2-4 (7) to require a telecommunications utility that,
2-5 together with affiliates, had more than six percent of the total
2-6 intrastate access minutes of use as measured for the most recent
2-7 12-month period, to pass switched access rate reductions under this
2-8 title to customers as required under Section 52.112. This
2-9 authority shall expire on the date specified in Section 52.112.
2-10 SECTION 3. Section 52.108, Utilities Code, is amended to
2-11 read as follows:
2-12 Sec. 52.108. OTHER PROHIBITED PRACTICES. The commission may
2-13 enter any order necessary to protect the public interest if the
2-14 commission finds after notice and hearing that a telecommunications
2-15 utility has:
2-16 (1) failed to maintain statewide average rates;
2-17 (2) abandoned interexchange message telecommunications
2-18 service to a local exchange area in a manner contrary to the public
2-19 interest; [or]
2-20 (3) engaged in a pattern of preferential or
2-21 discriminatory activities prohibited by Section 53.003, 55.005, or
2-22 55.006; or
2-23 (4) failed to pass switched access rate reductions to
2-24 customers under Chapter 56 or other law, as required under Section
2-25 52.112.
2-26 SECTION 4. Section 52.110, Utilities Code, is amended to
3-1 read as follows:
3-2 Sec. 52.110. BURDEN OF PROOF. (a) In a proceeding before
3-3 the commission in which it is alleged that a telecommunications
3-4 utility engaged in conduct in violation of Section 52.107, 52.108,
3-5 [or] 52.109, or 52.112, the burden of proof is on:
3-6 (1) a telecommunications utility complaining of
3-7 conduct committed against it in violation of this subchapter; or
3-8 (2) except as provided by Subsection (b), the
3-9 responding telecommunications utility if the proceedings are:
3-10 (A) brought by a customer or customer
3-11 representative who is not a telecommunications utility; or
3-12 (B) initiated by the commission.
3-13 (b) The commission may impose the burden of proof on the
3-14 complaining party in a proceeding described by Subsection (a)(2) if
3-15 the commission determines that placing the burden of proof on the
3-16 complaining party is in the public interest.
3-17 SECTION 5. Subchapter C, Chapter 52, Utilities Code, is
3-18 amended by adding Section 52.112 to read as follows:
3-19 Sec. 52.112. REDUCTION PASS-THROUGH REQUIRED. (a) Each
3-20 telecommunications utility that, together with affiliates, had more
3-21 than six percent of the total intrastate access minutes of use as
3-22 measured for the most recent 12-month period, shall pass through to
3-23 customers switched access rate reductions under this title. The
3-24 residential customer class shall receive no less than a
3-25 proportionate share of the reductions.
3-26 (b) Within six months following each reduction in intrastate
4-1 switched access charges under this title, each telecommunications
4-2 utility subject to this section shall file a report with the
4-3 commission demonstrating its compliance on an average revenue per
4-4 minute basis with Subsection (a).
4-5 (c) This section shall expire two years after the date
4-6 incumbent local exchange companies doing business in the state are
4-7 no longer prohibited by federal law from offering interLATA and
4-8 interstate long distance service.
4-9 SECTION 6. Section 54.007, Utilities Code, is amended to
4-10 read as follows:
4-11 Sec. 54.007. FLEXIBILITY PLAN. (a) After the commission
4-12 grants an application for a certificate of convenience and
4-13 necessity, a certificate of operating authority, or a service
4-14 provider certificate of operating authority or determines that a
4-15 certificate is not needed for the applicant to provide the relevant
4-16 services, the commission shall conduct appropriate proceedings to
4-17 establish a transitional flexibility plan for the incumbent local
4-18 exchange company in the same area or areas as the new certificate
4-19 holder.
4-20 (b) A basic local telecommunications service price of the
4-21 incumbent local exchange company may not be increased before the
4-22 fourth anniversary of the date the certificate is granted to the
4-23 applicant except that the price may be increased[:]
4-24 [(1)] as provided by this title[;]
4-25 [(2) when the new certificate holder has completed the
4-26 build-out plan required by Subchapter C, if applicable; or]
5-1 [(3) when a competitor for basic local
5-2 telecommunications service provides the service in an area in which
5-3 the build-out requirements have been eliminated].
5-4 SECTION 7. Subchapter C, Chapter 54, Utilities Code, is
5-5 amended to read as follows:
5-6 SUBCHAPTER C. CERTIFICATE OF OPERATING AUTHORITY
5-7 Sec. 54.101. DEFINITION. In this subchapter, "certificate"
5-8 means a certificate of operating authority.
5-9 Sec. 54.102. APPLICATION FOR CERTIFICATE. (a) A [In lieu
5-10 of applying for a certificate of convenience and necessity, a]
5-11 person may apply for a certificate of operating authority.
5-12 (b) [An applicant for a facilities-based certificate of
5-13 operating authority must include with the application a proposed
5-14 build-out plan in compliance with this subchapter that demonstrates
5-15 how the applicant will, over a six-year period, deploy facilities
5-16 throughout the geographic area of the certificated service area.]
5-17 [(c)] The applicant must file with the application a sworn
5-18 statement that the applicant has applied for each municipal
5-19 consent, franchise, or permit required for the type of services and
5-20 facilities for which the applicant has applied.
5-21 (c) An affiliate of a person holding a certificate of
5-22 convenience and necessity may hold a certificate of operating
5-23 authority if the holder of the certificate of convenience and
5-24 necessity is in compliance with federal law and Federal
5-25 Communications Commission rules governing affiliates and structural
5-26 separation. An affiliate of a person holding a certificate of
6-1 convenience and necessity may not directly or indirectly sell to a
6-2 non-affiliate any regulated product or service purchased from the
6-3 person holding a certificate of convenience and necessity at any
6-4 rate or price less than the price paid to the person holding a
6-5 certificate of convenience and necessity.
6-6 (d) A person may hold a certificate for all or any portion
6-7 of a service area for which one or more affiliates of the person
6-8 holds a certificate of operating authority, a service provider
6-9 certificate of operating authority, or a certificate of convenience
6-10 and necessity.
6-11 Sec. 54.103. GRANT OR DENIAL OF CERTIFICATE. (a) The
6-12 commission must grant or deny a certificate not later than the 60th
6-13 day after the date the application for the certificate is filed.
6-14 The commission may extend the deadline on good cause shown.
6-15 (b) The commission shall grant each certificate on a
6-16 nondiscriminatory basis after considering factors such as:
6-17 (1) [the adequacy of the applicant's build-out plan;]
6-18 [(2)] the technical and financial qualifications of
6-19 the applicant; and
6-20 (2) [(3)] the applicant's ability to meet the
6-21 commission's quality of service requirements.
6-22 (c) In an exchange of an incumbent local exchange company
6-23 that serves fewer than 31,000 access lines, in addition to the
6-24 factors described by Subsection (b), the commission shall consider:
6-25 (1) the effect of granting the certificate on a public
6-26 utility serving the area and on that utility's customers;
7-1 (2) the ability of that public utility to provide
7-2 adequate service at reasonable rates;
7-3 (3) the effect of granting the certificate on the
7-4 ability of that public utility to act as the provider of last
7-5 resort; and
7-6 (4) the ability of the exchange, not the company, to
7-7 support more than one provider of service.
7-8 (d) Except as provided by Subsections (e) and (f), the
7-9 commission may grant an application for a certificate only for an
7-10 area or areas that are contiguous and reasonably compact and cover
7-11 an area of at least 27 square miles.
7-12 (e) In an exchange in a county that has a population of less
7-13 than 500,000 and that is served by an incumbent local exchange
7-14 company that has more than 31,000 access lines, an area covering
7-15 less than 27 square miles may be approved if the area is contiguous
7-16 and reasonably compact and has at least 20,000 access lines.
7-17 (f) In an exchange of a company that serves fewer than
7-18 31,000 access lines in this state, the commission may grant an
7-19 application only for an area that has boundaries similar to the
7-20 boundaries of the serving central office that is served by the
7-21 incumbent local exchange company that holds the certificate of
7-22 convenience and necessity for the area.
7-23 [Sec. 54.104. BUILD-OUT PLAN REQUIREMENTS. (a) The
7-24 build-out plan required by Section 54.102 must provide that, by the
7-25 end of the:]
7-26 [(1) first year, 10 percent of the area to be served
8-1 must be served with facilities that are not facilities of the
8-2 incumbent local exchange company;]
8-3 [(2) third year, 50 percent of the area to be served
8-4 must be served with facilities that are not facilities of the
8-5 incumbent local exchange company; and]
8-6 [(3) sixth year, 100 percent of the area to be served
8-7 must be served with facilities that are not facilities of the
8-8 incumbent local exchange company.]
8-9 [(b) The build-out plan may permit the certificate holder to
8-10 serve not more than 40 percent of the certificate holder's service
8-11 area by reselling the incumbent local exchange company's
8-12 facilities. The resale must be in accordance with:]
8-13 [(1) Section 54.105; and]
8-14 [(2) the resale tariff approved by the commission
8-15 under Subchapter C, Chapter 60.]
8-16 [(c) The resale limitation applies to an incumbent local
8-17 exchange facility that a certificate holder resells in providing
8-18 local exchange telephone service, regardless of whether:]
8-19 [(1) the certificate holder purchases the facility
8-20 directly from the incumbent local exchange company; or]
8-21 [(2) an intermediary carrier purchases the facility
8-22 from the incumbent local exchange company and then provides the
8-23 facility to the certificate holder for resale.]
8-24 [(d) To meet the build-out requirement prescribed by this
8-25 subchapter, a certificate holder:]
8-26 [(1) may not use commercial mobile service; and]
9-1 [(2) may use personal communication services (PCS) or
9-2 other wireless technology licensed or allocated by the Federal
9-3 Communications Commission after January 1, 1995.]
9-4 [Sec. 54.105. SIX-YEAR LIMITATION ON RESALE OF SERVICES.
9-5 Before the sixth anniversary of the date a certificate is granted,
9-6 the certificate holder may extend service by resale only:]
9-7 [(1) in the area it is obligated to serve under the
9-8 approved build-out plan; and]
9-9 [(2) to the distant premises of one of its
9-10 multi-premises customers beyond the approved build-out area but in
9-11 its certificated service area.]
9-12 Sec. 54.104 [54.106]. TIME OF SERVICE REQUIREMENTS.
9-13 (a) The commission by rule may prescribe the period within which a
9-14 certificate holder must be able to serve customers.
9-15 (b) Notwithstanding Subsection (a), a certificate holder
9-16 must serve a customer [in the build-out area] not later than the
9-17 30th day after the date the customer requests service.
9-18 [Sec. 54.107. REQUIREMENTS RELATING TO CERTAIN FACILITIES.
9-19 As part of the build-out requirements, the commission may not
9-20 require a certificate holder to:]
9-21 [(1) place a drop facility on each customer's
9-22 premises; or]
9-23 [(2) activate a fiber optic facility in advance of a
9-24 customer request.]
9-25 [Sec. 54.108. BUILD-OUT PLAN COMPLIANCE. (a) A certificate
9-26 holder shall file periodic reports with the commission
10-1 demonstrating compliance with:]
10-2 [(1) the plan approved by the commission; and]
10-3 [(2) the resale limitation prescribed by Section
10-4 54.104(b).]
10-5 [(b) The commission may administratively and temporarily
10-6 waive compliance with the six-year build-out plan on a showing of
10-7 good cause.]
10-8 [Sec. 54.109. ELIMINATION OF BUILD-OUT REQUIREMENTS FOR
10-9 CERTAIN PROVIDERS. (a) The commission may waive the build-out
10-10 requirements of this subchapter for an additional applicant in a
10-11 particular area:]
10-12 [(1) on or after the sixth anniversary of the date a
10-13 certificate is granted for that area; or]
10-14 [(2) on or after the date a certificate holder
10-15 completes the holder's build-out plan in that area.]
10-16 [(b) The build-out requirements of this subchapter do not
10-17 apply to a service area:]
10-18 [(1) that is served by an incumbent local exchange
10-19 company that:]
10-20 [(A) has more than one million access lines; and]
10-21 [(B) on September 1, 1995, was subject to a
10-22 prohibition under federal law on the provision of interLATA
10-23 service; and]
10-24 [(2) for which all prohibitions on the incumbent local
10-25 exchange company's provision of interLATA services are removed so
10-26 the company can offer interLATA service together with local and
11-1 intraLATA toll service.]
11-2 [Sec. 54.110. HEARING ON BUILD-OUT AND RESALE REQUIREMENTS.
11-3 (a) The commission on application may conduct a hearing to
11-4 determine:]
11-5 [(1) whether the build-out requirements of Sections
11-6 54.102(b), 54.103(e) and (f), 54.104, 54.105, 54.106, and 54.107
11-7 have created a barrier to the entry of facilities-based local
11-8 exchange telephone service competition in an exchange in a county
11-9 that has a population of more than 500,000 and that is served by a
11-10 company that has more than 31,000 access lines; and]
11-11 [(2) the effect of the resale provisions on the
11-12 development of competition, other than the development of
11-13 competition in the certificated areas of companies that serve fewer
11-14 than 31,000 access lines as provided by Section 54.156(a).]
11-15 [(b) In making a determination under Subsection (a), the
11-16 commission shall consider:]
11-17 [(1) this title's policy to encourage construction of
11-18 local exchange networks;]
11-19 [(2) the number and type of competitors that have
11-20 sought to provide local exchange competition under the existing
11-21 rules prescribed by this title; and]
11-22 [(3) whether adopting new build-out and resale rules
11-23 would make innovative and competitive local exchange telephone
11-24 services more likely to be provided.]
11-25 [(c) The commission may change a requirement described by
11-26 Subsection (a)(1) or prescribed by Subchapter D if:]
12-1 [(1) the commission determines that the build-out
12-2 requirements have created a barrier to facilities-based local
12-3 exchange competition in an exchange described by Subsection (a)(1);
12-4 and]
12-5 [(2) the changes will encourage additional
12-6 facilities-based competition.]
12-7 [(d) Notwithstanding Subsection (c), the commission may not
12-8 reduce an exchange size to below 12 square miles or increase the
12-9 resale percentage prescribed by Section 54.104(b) to more than 50
12-10 percent.]
12-11 [(e) A rule adopted under Subsection (c) may apply only to a
12-12 person who files an application for a certificate after the date
12-13 the rule is adopted.]
12-14 Sec. 54.105 [54.111]. PENALTY FOR VIOLATION OF TITLE. If a
12-15 certificate holder fails to comply with a requirement of this
12-16 title, the commission may:
12-17 (1) revoke the holder's certificate;
12-18 (2) impose against the holder administrative penalties
12-19 under Subchapter B, Chapter 15; or
12-20 (3) take another action under Subchapter B, Chapter
12-21 15.
12-22 SECTION 8. Section 56.021, Utilities Code, is amended to
12-23 read as follows:
12-24 Sec. 56.021. UNIVERSAL SERVICE FUND ESTABLISHED. The
12-25 commission shall adopt and enforce rules requiring local exchange
12-26 companies to establish a universal service fund to:
13-1 (1) assist telecommunications providers [local
13-2 exchange companies] in providing basic local telecommunications
13-3 service at reasonable rates in high cost or rural areas;
13-4 (2) reimburse telecommunications providers [local
13-5 exchange companies] for revenue lost by providing tel-assistance
13-6 service under Subchapter C;
13-7 (3) reimburse the telecommunications carrier that
13-8 provides the statewide telecommunications relay access service
13-9 under Subchapter D; and
13-10 (4) reimburse the department and the commission for
13-11 costs incurred in implementing this chapter and Chapter 57.
13-12 SECTION 9. Sections 56.023 and 56.024, Utilities Code, are
13-13 amended to read as follows:
13-14 Sec. 56.023. COMMISSION POWERS AND DUTIES. (a) The
13-15 commission shall:
13-16 (1) in a manner that assures reasonable rates for
13-17 basic local telecommunications service, adopt eligibility criteria
13-18 and review procedures, including a method for administrative
13-19 review, the commission finds necessary to fund the universal
13-20 service fund and make distributions from that fund;
13-21 (2) determine which telecommunications providers
13-22 [local exchange companies] meet the eligibility criteria;
13-23 (3) determine the amount of and approve a procedure
13-24 for reimbursement to telecommunications providers [local exchange
13-25 companies] of revenue lost in providing tel-assistance service
13-26 under Subchapter C;
14-1 (4) establish and collect fees from the universal
14-2 service fund necessary to recover the costs the department and the
14-3 commission incur in administering this chapter and Chapter 57;
14-4 [and]
14-5 (5) approve procedures for the collection and
14-6 disbursal of the revenue of the universal service fund; and
14-7 (6) establish and implement the universal service fund
14-8 provisions required by Section 56.021(1) for all eligible
14-9 telecommunications providers not later than August 1, 1999.
14-10 (b) The eligibility criteria must require that a
14-11 telecommunications provider [local exchange company], in compliance
14-12 with the commission's quality of service requirements:
14-13 (1) offer service to each consumer within the
14-14 company's certificated area; and
14-15 (2) render continuous and adequate service within the
14-16 company's certificated area.
14-17 (c) The commission shall adopt rules for the administration
14-18 of the universal service fund and may act as necessary and
14-19 convenient to administer the fund.
14-20 Sec. 56.024. REPORTS; CONFIDENTIALITY. (a) The commission
14-21 may require a [local exchange company or another]
14-22 telecommunications provider to provide a report or information
14-23 necessary to assess contributions and disbursements to the
14-24 universal service fund.
14-25 (b) A report or information is confidential and not subject
14-26 to disclosure under Chapter 552, Government Code.
15-1 SECTION 10. Section 56.026, Utilities Code, is amended to
15-2 read as follows:
15-3 Sec. 56.026. UNIVERSAL SERVICE FUND DISBURSEMENTS. (a) A
15-4 revenue requirement showing is not required for a disbursement from
15-5 the universal service fund under this subchapter.
15-6 (b) The commission shall make each disbursement from the
15-7 universal service fund promptly and efficiently so that a
15-8 telecommunications provider [or local exchange company] does not
15-9 experience an unnecessary cash-flow change as a result of a change
15-10 in governmental policy.
15-11 (c) In establishing and implementing the universal service
15-12 fund provisions described in Section 56.021(1), the commission
15-13 shall size the fund to provide for disbursements to a company
15-14 serving more than five million access lines in this state
15-15 sufficient to offset a reduction of at least 2.35 cents per minute
15-16 in switched access rates on a combined originating and terminating
15-17 basis.
15-18 SECTION 11. Subchapter B, Chapter 56, Utilities Code, is
15-19 amended by adding Section 56.028 to read as follows:
15-20 Sec. 56.028. UNIVERSAL SERVICE FUND REIMBURSEMENT FOR
15-21 CERTAIN INTRALATA SERVICE. Upon request of a local exchange
15-22 company that is not an electing company under Chapters 58 and 59,
15-23 the commission shall provide reimbursement through the universal
15-24 service fund for reduced rates for intraLATA interexchange high
15-25 capacity (1.544 Mbps) service for entities described in Section
15-26 58.253(a). The amount of reimbursement shall be the difference
16-1 between the company's tariffed rate for such service as of
16-2 January 1, 1998, and the lowest rate offered for such service by
16-3 any local exchange company electing incentive regulation under
16-4 Chapter 58.
16-5 SECTION 12. Section 56.071, Utilities Code, is amended to
16-6 read as follows:
16-7 Sec. 56.071. TEL-ASSISTANCE SERVICE REQUIREMENTS. (a) The
16-8 commission shall adopt and enforce rules requiring a local exchange
16-9 company to establish a telecommunications service assistance
16-10 program to provide a reduction in the cost of telecommunications
16-11 service to each eligible consumer in the company's certificated
16-12 area. The reduction must be a reduction on the consumer's
16-13 telephone bill.
16-14 (b) In addition to local exchange companies, this subchapter
16-15 applies to telecommunications providers that receive universal
16-16 service fund support pursuant to the commission's universal service
16-17 fund rules, and any reference to or requirement imposed on local
16-18 exchange companies in this subchapter shall also apply to such
16-19 telecommunications providers.
16-20 (c) Except as provided by Section 56.075(b), the reduction
16-21 allowed by the program is 65 percent of the applicable tariff rate
16-22 for the service provided.
16-23 (d) [(c)] The program is named "tel-assistance service."
16-24 SECTION 13. Section 58.002, Utilities Code, is amended to
16-25 read as follows:
16-26 Sec. 58.002. DEFINITIONS [DEFINITION]. In this chapter:
17-1 (1) "Electing[, "electing] company" means an incumbent
17-2 local exchange company that elects to be subject to incentive
17-3 regulation and to make the corresponding infrastructure commitment
17-4 under this chapter.
17-5 (2) "Urban," for purposes of Subchapters C, D, and E,
17-6 means an area within rate group 4 and above in tariffs on file with
17-7 the commission.
17-8 SECTION 14. Section 58.021, Utilities Code, is amended to
17-9 read as follows:
17-10 Sec. 58.021. ELECTION. (a) An incumbent local exchange
17-11 company may elect to be subject to incentive regulation and to make
17-12 the corresponding infrastructure commitment under this chapter by
17-13 notifying the commission in writing of its election.
17-14 (b) The notice must include a statement that the company
17-15 agrees to:
17-16 (1) limit until September 1, 2005, [for four years]
17-17 any increase in a rate the company charges for basic network
17-18 services as prescribed by Subchapter C; and
17-19 (2) fulfill the infrastructure commitment prescribed
17-20 by Subchapters F and G.
17-21 (c) Except as provided in Subsection (d), an election under
17-22 this chapter remains in effect until the legislature eliminates the
17-23 incentive regulation authorized by this chapter and Chapter 59.
17-24 (d) The commission may allow an electing company serving
17-25 fewer than five million access lines to withdraw the company's
17-26 election under this chapter:
18-1 (1) on application by the company; and
18-2 (2) only for good cause.
18-3 (e) In this section, "good cause" includes only matters
18-4 beyond the control of the company.
18-5 SECTION 15. Section 58.024, Utilities Code, is amended by
18-6 amending Subsections (b) and (c) and adding Subsection (d) to read
18-7 as follows:
18-8 (b) The commission shall establish criteria for determining
18-9 whether a service should be reclassified. The criteria must
18-10 include consideration of the:
18-11 (1) availability of the service from other providers;
18-12 (2) [proportion of the market that receives the
18-13 service;]
18-14 [(3)] effect of the reclassification on service
18-15 subscribers; and
18-16 (3) [(4)] nature of the service.
18-17 (c) The commission may not reclassify a service until:
18-18 (1) each competitive safeguard prescribed by
18-19 Subchapters B-G, Chapter 60, is fully implemented; or
18-20 (2) for a company that serves more than five million
18-21 access lines in this state, the date on which the Federal
18-22 Communications Commission determines in accordance with 47 U.S.C.
18-23 Section 271 that the company may enter the interLATA
18-24 telecommunications market in this state.
18-25 (d) For an electing company having greater than five million
18-26 access lines, the commission may reclassify a service subject to
19-1 the following conditions:
19-2 (1) the electing company must file a request for a
19-3 service reclassification including information sufficient for the
19-4 commission to perform a review and evaluation under Subsection (b);
19-5 (2) the commission must grant or deny the request not
19-6 later than the 30th day after the date the electing company files
19-7 the request for service reclassification; and
19-8 (3) there shall be a rebuttable presumption that the
19-9 request for service reclassification by the electing company should
19-10 be granted if the commission finds that there is a competitive
19-11 alternative provider serving customers through means other than
19-12 total service resale.
19-13 SECTION 16. Section 58.028, Utilities Code, is amended to
19-14 read as follows:
19-15 Sec. 58.028. REVIEW AND REPORT OF EFFECTS OF ELECTION.
19-16 (a) Not later than January 1, 2004 [2000], the commission shall
19-17 begin a review and evaluation of each company that elects under
19-18 this chapter or Chapter 59.
19-19 (b) The review must include an evaluation of the effects of
19-20 the election, including:
19-21 (1) consumer benefits;
19-22 (2) impact of competition;
19-23 (3) infrastructure investments; and
19-24 (4) quality of service.
19-25 (c) The commission shall file a report with the legislature
19-26 not later than January 1, 2005 [2001]. The report must include the
20-1 commission's recommendations as to whether the incentive regulation
20-2 provided by this chapter and Chapter 59 should be extended,
20-3 modified, eliminated, or replaced with another form of regulation.
20-4 (d) This section expires September 1, 2003 [2001].
20-5 SECTION 17. Subchapter C, Chapter 58, Utilities Code, is
20-6 amended by adding Section 58.0511 to read as follows:
20-7 Sec. 58.0511. SERVICES INCLUDED FOR CERTAIN ELECTING
20-8 COMPANIES. (a) From September 1, 1999, until such time as an
20-9 affected company offers interLATA long distance service, and
20-10 notwithstanding Section 58.051, for an electing company with more
20-11 than five million access lines, the services in Subsection (b) are
20-12 basic network services, unless reclassified under Section 58.024.
20-13 (b) Basic network services include:
20-14 (1) flat rate local exchange telephone service
20-15 including primary directory listings and the receipt of a directory
20-16 and any applicable mileage or zone charges;
20-17 (2) tone dialing service;
20-18 (3) lifeline and tel-assistance service;
20-19 (4) service connection for basic services;
20-20 (5) direct inward dialing service for basic services;
20-21 (6) private pay telephone access service;
20-22 (7) call trap and trace service;
20-23 (8) access for all residential and business end users
20-24 to 911 service provided by a local authority and access to dual
20-25 party relay service;
20-26 (9) mandatory extended area service arrangements;
21-1 (10) mandatory extended metropolitan service or other
21-2 mandatory toll-free calling arrangements;
21-3 (11) "1-plus" intraLATA message toll service if
21-4 intraLATA dialing parity has not yet been implemented; and
21-5 (12) residential and business installment billing and
21-6 late payment charges.
21-7 (c) Rates for the services listed in Subsections (b) and (e)
21-8 are capped until September 1, 2005.
21-9 (d) At such time as an electing company serving more than
21-10 five million access lines offers interLATA long distance, the
21-11 services listed in Subsection (e) are basic network services for
21-12 that company except that the commission may permit an electing
21-13 company, on application, to establish rates, terms, and conditions
21-14 of service for residential and business installment billing and
21-15 late payment charges.
21-16 (e) Basic network services include:
21-17 (1) flat rate local exchange telephone service
21-18 including primary directory listings and the receipt of a directory
21-19 and any applicable mileage or zone charges, tone dialing, basic
21-20 service connection, and direct inward dialing residential services;
21-21 (2) flat rate local exchange telephone services
21-22 including primary directory listings and the receipt of a directory
21-23 and any applicable mileage or zone charges, tone dialing, basic
21-24 service connection, and direct inward dialing non-urban business
21-25 services;
21-26 (3) lifeline and tel-assistance service;
22-1 (4) private pay telephone access service;
22-2 (5) call trap and trace service;
22-3 (6) access for all residential and business end users
22-4 to 911 service provided by a local authority and access to dual
22-5 party relay service;
22-6 (7) mandatory extended area service arrangements;
22-7 (8) mandatory extended metropolitan service or other
22-8 mandatory toll-free calling arrangements; and
22-9 (9) residential and non-urban business installment
22-10 billing and late payment charges.
22-11 SECTION 18. Sections 58.054 and 58.055, Utilities Code, are
22-12 amended to read as follows:
22-13 Sec. 58.054. RATES CAPPED. (a) As a condition of election
22-14 under this chapter, an electing company shall commit to not
22-15 increasing a rate for a basic network service on or before the
22-16 fourth anniversary of its election date.
22-17 (b) The rates an electing company may charge on or before
22-18 that fourth anniversary are the rates charged by the company on
22-19 June 1, 1995, or, for a company that elects under this chapter
22-20 after September 1, 1999, the rates charged on the date of its
22-21 election, without regard to a proceeding pending under:
22-22 (1) Section 15.001;
22-23 (2) Subchapter D, Chapter 53; or
22-24 (3) Subchapter G, Chapter 2001, Government Code.
22-25 (c) Notwithstanding Subsections (a) and (b), the cap on the
22-26 rates for basic network services for a company electing under this
23-1 chapter may not expire before September 1, 2005.
23-2 Sec. 58.055. RATE ADJUSTMENT BY COMPANY. (a) An electing
23-3 company may increase a rate for a basic network service during the
23-4 election [four-year] period prescribed by Section 58.054 only:
23-5 (1) with commission approval that the proposed change
23-6 is included in Section 58.056, 58.057, or 58.058; and
23-7 (2) as provided by Sections 58.056, 58.057, 58.058,
23-8 and 58.059.
23-9 (b) Notwithstanding Subchapter F, Chapter 60, an electing
23-10 company may, on its own initiative, decrease a rate for a basic
23-11 network service during the electing [four-year] period.
23-12 (c) [The company may decrease the rate for switched access
23-13 service to an amount above the service's long run incremental cost.]
23-14 [(d)] The company may decrease the rate for a basic local
23-15 telecommunications service [other than switched access] to an
23-16 amount above the service's appropriate cost. If the company has
23-17 been required to perform or has elected to perform a long run
23-18 incremental cost study, the appropriate cost for the service is the
23-19 service's long run incremental cost.
23-20 SECTION 19. Section 58.060, Utilities Code, is amended to
23-21 read as follows:
23-22 Sec. 58.060. RATE ADJUSTMENT AFTER CAP EXPIRATION. After
23-23 the expiration of the [four-year] period during which the rates for
23-24 basic network services are capped as prescribed by Section 58.054
23-25 [expires], an electing company may increase a rate for a basic
23-26 network service only:
24-1 (1) with commission approval subject to this title;
24-2 and
24-3 (2) to the extent consistent with achieving universal
24-4 affordable service.
24-5 SECTION 20. Subchapter C, Chapter 58, Utilities Code, is
24-6 amended by adding Sections 58.063 and 58.064 to read as follows:
24-7 Sec. 58.063. FLEXIBLE PACKAGING ACROSS SERVICE
24-8 CLASSIFICATIONS. (a) Notwithstanding any other provision of this
24-9 title, an electing company serving more than five million access
24-10 lines may package basic network services with discretionary
24-11 services or competitive services as of the date the company enters
24-12 into the interLATA long distance market.
24-13 (b)(1) Notwithstanding any other provision of this title, an
24-14 electing company serving less than five million access lines may
24-15 package basic network services with discretionary services or
24-16 competitive services if the company notifies the commission of its
24-17 binding commitment to make the following infrastructure
24-18 improvements by September 1, 2001:
24-19 (A) install Common Channel Signaling 7
24-20 capability in each central office; and
24-21 (B) connect all of the company's serving central
24-22 offices to the company's respective LATA tandem central offices
24-23 with optical fiber or equivalent facilities.
24-24 (2) These commitments shall not apply to exchanges of
24-25 the company sold or transferred before, or for which contracts for
24-26 sale or transfer were pending on September 1, 2001. In the case of
25-1 exchanges for which contracts for sale or transfer were pending as
25-2 of March 1, 2001, where the purchaser withdrew or defaulted prior
25-3 to September 1, 2001, the company shall have one year from the date
25-4 of withdrawal or default to comply with the commitments.
25-5 (c) The price for a package of services containing basic
25-6 network services and discretionary or competitive services shall
25-7 not be higher than the sum of the tariffed rates of the basic
25-8 network services and the competitive services and the price
25-9 ceilings of the discretionary services.
25-10 (d) The price for a package of services containing basic
25-11 network services and discretionary or competitive services shall be
25-12 set at a level above the sum of:
25-13 (1) the lesser of the long run incremental cost or the
25-14 tariffed rate in effect on September 1, 1999, for a basic network
25-15 service; and
25-16 (2) the long run incremental cost in accordance with
25-17 the imputation rules prescribed in Subchapter D, Chapter 60, for a
25-18 discretionary or competitive service.
25-19 (e) An electing company may flexibly price a package that
25-20 includes a basic network service in any manner listed in Section
25-21 51.002(7), except that such a package may not be offered in a
25-22 manner that results in a customer-specific contract.
25-23 Sec. 58.064. ZONE-DENSITY PRICING OF BASIC LOCAL
25-24 TELECOMMUNICATIONS SERVICE. Until an electing company may engage
25-25 in pricing flexibility pursuant to Section 58.063, the only form of
25-26 pricing flexibility allowed for basic local telecommunications
26-1 service is zone-density pricing.
26-2 SECTION 21. Subchapter D, Chapter 58, Utilities Code, is
26-3 amended by adding Section 58.1011 to read as follows:
26-4 Sec. 58.1011. SERVICES INCLUDED FOR CERTAIN ELECTING
26-5 COMPANIES. (a) From September 1, 1999, until such time as an
26-6 affected company offers interLATA long distance service, and
26-7 notwithstanding Section 58.101, for an electing company with more
26-8 than five million access lines, the services in Subsection (b) are
26-9 discretionary services, unless reclassified under Section 58.024.
26-10 (b) Discretionary services include:
26-11 (1) call waiting, call forwarding, and custom calling
26-12 features that are not classified as competitive services;
26-13 (2) call return, caller identification, and call
26-14 control options that are not classified as competitive services;
26-15 (3) integrated services digital network (ISDN)
26-16 services;
26-17 (4) 0+ and 0- operator services if intraLATA dialing
26-18 parity has not yet been implemented; and
26-19 (5) new services when associated with a basic network
26-20 service or a discretionary service.
26-21 (c) At such time as an electing company serving more than
26-22 five million access lines offers interLATA long distance, the
26-23 services listed in Subsection (d) are discretionary services for
26-24 that company.
26-25 (d) Discretionary services include:
26-26 (1) call waiting, call forwarding, and custom calling
27-1 features, call return, caller identification, and call control
27-2 options that are not classified as competitive services, when
27-3 associated with a residential line;
27-4 (2) call waiting, call forwarding, and custom calling
27-5 features, call return, caller identification, and call control
27-6 options that are not classified as competitive services, when
27-7 associated with a non-urban business line;
27-8 (3) non-urban integrated services digital network
27-9 (ISDN); and
27-10 (4) new services when associated with a basic network
27-11 service or a discretionary service.
27-12 SECTION 22. Section 58.102, Utilities Code, is amended to
27-13 read as follows:
27-14 Sec. 58.102. MAXIMUM PRICE. (a) The commission shall set
27-15 the maximum price an electing company may charge for a
27-16 discretionary service until:
27-17 (1) for an electing company serving more than five
27-18 million access lines, the date the Federal Communications
27-19 Commission determines that the company may enter the interLATA
27-20 telecommunications market in this state; or
27-21 (2) for an electing company serving fewer than five
27-22 million access lines, September 1, 1999.
27-23 (b) The initial maximum price for a service is the price in
27-24 effect on the date of the electing company's election [September 1,
27-25 1995], without regard to a proceeding pending under:
27-26 (1) Section 15.001;
28-1 (2) Subchapter D, Chapter 53; or
28-2 (3) Subchapter G, Chapter 2001, Government Code.
28-3 (c) After the dates prescribed in Subsection (a), the
28-4 electing company may file annually a revised maximum price list for
28-5 the services classified as discretionary services. The new maximum
28-6 prices for the services classified as discretionary services may
28-7 not exceed, in the aggregate, 112 percent of the previous maximum
28-8 prices for those services. The electing company shall file the new
28-9 maximum price list in an informational tariff filed with the
28-10 commission five days prior to the date on which the new maximum
28-11 prices will become effective. [The commission may not increase the
28-12 initial maximum price until after the proceedings required by
28-13 Chapter 60.]
28-14 [(d) After the proceedings required by Chapter 60, the
28-15 commission, on its own motion or on application by the electing
28-16 company, may change the initial maximum price. However, the
28-17 commission may not increase the price more than 10 percent
28-18 annually.]
28-19 SECTION 23. Subchapter E, Chapter 58, Utilities Code, is
28-20 amended by adding Section 58.1511 to read as follows:
28-21 Sec. 58.1511. SERVICES INCLUDED FOR CERTAIN ELECTING
28-22 COMPANIES. (a) From September 1, 1999, until such time as an
28-23 affected company offers interLATA long distance service, and
28-24 notwithstanding Section 58.151, for an electing company with more
28-25 than five million access lines, the services in Subsection (b) are
28-26 competitive services.
29-1 (b) Competitive services include:
29-2 (1) directory assistance;
29-3 (2) "1-plus" intraLATA message toll service if
29-4 intraLATA dialing parity has been implemented;
29-5 (3) 0+ and 0- operator services if intraLATA dialing
29-6 parity has been implemented;
29-7 (4) central office based PBX-type services;
29-8 (5) wholesale billing and collection services;
29-9 (6) services described in the WATS tariff as of
29-10 January 1, 1995;
29-11 (7) 800 and foreign exchange services;
29-12 (8) private line service;
29-13 (9) special access service;
29-14 (10) services from public pay telephones;
29-15 (11) paging services and mobile services (IMTS);
29-16 (12) 911 services provided to a local authority that
29-17 are available from another provider;
29-18 (13) speed dialing;
29-19 (14) three-way calling;
29-20 (15) data services;
29-21 (16) all services not specifically classified as basic
29-22 network services or discretionary services; and
29-23 (17) new services other than those described in
29-24 Section 58.1011(b).
29-25 (c) At such time as an electing company serving more than
29-26 five million access lines offers interLATA long distance, the
30-1 services listed in Subsection (d) are competitive services for that
30-2 company.
30-3 (d) Competitive services include:
30-4 (1) flat rate urban business local exchange telephone
30-5 service including primary directory listings and the receipt of a
30-6 directory and any applicable mileage or zone charges;
30-7 (2) urban business tone dialing service;
30-8 (3) service connection for basic urban business
30-9 services;
30-10 (4) direct inward dialing service for basic urban
30-11 business services;
30-12 (5) directory assistance;
30-13 (6) call waiting, call forwarding, and custom calling
30-14 features, when associated with an urban business line;
30-15 (7) call return, caller identification, and call
30-16 control options, when associated with an urban business line;
30-17 (8) "1-plus" intraLATA message toll service;
30-18 (9) 0+ and 0- operator services;
30-19 (10) central office based PBX-type services;
30-20 (11) wholesale billing and collection services;
30-21 (12) services described in the WATS tariff as of
30-22 January 1, 1995;
30-23 (13) 800 and foreign exchange services;
30-24 (14) private line service;
30-25 (15) special access service;
30-26 (16) services from public pay telephones;
31-1 (17) paging services and mobile services (IMTS);
31-2 (18) 911 services provided to a local authority that
31-3 are available from another provider;
31-4 (19) speed dialing;
31-5 (20) three-way calling;
31-6 (21) data services;
31-7 (22) all services not specifically classified as basic
31-8 network services or discretionary services;
31-9 (23) urban integrated services digital network (ISDN);
31-10 (24) new services other than those described in
31-11 Section 58.1011(d); and
31-12 (25) urban business installment billing and late
31-13 payment charges.
31-14 (e) Rates for the services listed in Subsections (d)(1)-(3)
31-15 are capped until September 1, 2005.
31-16 SECTION 24. Subchapter E, Chapter 58, Utilities Code, is
31-17 amended by adding Section 58.1512 to read as follows:
31-18 Sec. 58.1512. SERVICES INCLUDED FOR CERTAIN ELECTING
31-19 COMPANIES. (a) For the 12-month period following the date an
31-20 electing company with more than five million access lines begins
31-21 offering interLATA long distance service, and notwithstanding
31-22 Sections 58.101 and 58.1511, the following services offered by such
31-23 an electing company shall be classified as discretionary services
31-24 and may not be reclassified under Section 58.024:
31-25 (1) flat rate urban business local exchange telephone
31-26 service;
32-1 (2) urban business tone dialing service;
32-2 (3) service connection for basic urban business
32-3 services; and
32-4 (4) direct inward dialing service for basic urban
32-5 business services.
32-6 (b) At the expiration of the 12-month period described in
32-7 Subsection (a), the services listed in Subsections (a)(1)-(4) shall
32-8 be classified as competitive services.
32-9 (c) Notwithstanding any other provision in this title, an
32-10 electing company with more than five million access lines may not
32-11 provide the services listed in Subsections (a)(1)-(4) pursuant to a
32-12 customer-specific contract until 18 months have expired following
32-13 the date that such an electing company begins offering interLATA
32-14 long distance service. An electing company may not offer a package
32-15 of services, including a service listed in Subsections (a)(1)-(4),
32-16 that results in a customer-specific contract until the 18-month
32-17 period has expired.
32-18 SECTION 25. Subchapter E, Chapter 58, Utilities Code, is
32-19 amended by adding Section 58.155 to read as follows:
32-20 Sec. 58.155. INTERCONNECTION SERVICES. Because
32-21 interconnection to competitive providers and interconnection for
32-22 commercial mobile service providers are subject to the requirements
32-23 of Sections 251 and 252, Communications Act of 1934, as amended (47
32-24 U.S.C. Sections 251 and 252), as amended, and Federal
32-25 Communications Commission rules, including the Federal
32-26 Communications Commission's authority to arbitrate issues, they are
33-1 not addressed in Sections 58.0511, 58.1011, and 58.1511.
33-2 SECTION 26. Chapter 58, Utilities Code, is amended by adding
33-3 Subchapter H to read as follows:
33-4 SUBCHAPTER H. SWITCHED ACCESS SERVICES
33-5 Sec. 58.301. SWITCHED ACCESS RATE REDUCTION. (a) An
33-6 electing company with greater than five million access lines shall
33-7 reduce its switched access rates on a combined originating and
33-8 terminating basis as follows:
33-9 (1) on September 1, 1999, switched access rates on a
33-10 combined originating and terminating basis in effect on that date
33-11 shall be reduced by one cent per minute;
33-12 (2) on the company's entry into the interLATA long
33-13 distance market, switched access rates on a combined originating
33-14 and terminating basis shall be reduced by an additional two cents
33-15 per minute; and
33-16 (3) on the first anniversary of the company's entry
33-17 into the interLATA long distance market, switched access rates on a
33-18 combined originating and terminating basis shall be reduced by an
33-19 additional half cent per minute.
33-20 Sec. 58.302. SWITCHED ACCESS RATE CAP. An electing company
33-21 may not increase the per minute rates for switched access services
33-22 on a combined originating and terminating basis above the lesser
33-23 of:
33-24 (1) the rates for switched access services charged by
33-25 that electing company on September 1, 1999, as may be further
33-26 reduced upon implementation of the universal service fund pursuant
34-1 to Chapter 56; or
34-2 (2) the applicable rate described by Section 58.301 as
34-3 may be further reduced upon implementation of the universal service
34-4 fund pursuant to Chapter 56.
34-5 Sec. 58.303. SWITCHED ACCESS CHARGE STUDY. (a) Not later
34-6 than November 1, 1999, the commission shall begin a review and
34-7 evaluation of the rates for intrastate switched access service.
34-8 The review shall include an evaluation of at least the following
34-9 issues:
34-10 (1) whether alternative rate structures for recovery
34-11 of switched access revenues are in the public interest and
34-12 competitively neutral; and
34-13 (2) whether disparities in rates for switched access
34-14 service between local exchange companies are in the public
34-15 interest.
34-16 (b) The commission shall file a report with the legislature
34-17 no later than January 1, 2001. The report must include the
34-18 commission's recommendations as to the issues reviewed and
34-19 evaluated.
34-20 (c) This section expires September 1, 2001.
34-21 SECTION 27. Section 59.021, Utilities Code, is amended by
34-22 adding Subsection (c) to read as follows:
34-23 (c) A company electing under this chapter may renew the
34-24 election for successive two-year periods. An election that is
34-25 renewed under this subsection remains in effect until the earlier
34-26 of the date that:
35-1 (1) the election expires because it was not renewed;
35-2 (2) the commission allows the company to withdraw its
35-3 election under Section 59.022; or
35-4 (3) the legislature eliminates the incentive
35-5 regulation authorized by this chapter and Chapter 58.
35-6 SECTION 28. Section 59.024, Utilities Code, is amended to
35-7 read as follows:
35-8 Sec. 59.024. RATE CHANGES. (a) Except for the charges
35-9 permitted under Subchapter C, Chapter 55, Subchapter B, Chapter 56,
35-10 and Section 55.024, an electing company may not, [on or] before the
35-11 end of the company's election period under this chapter [sixth
35-12 anniversary of its election date], increase a rate previously
35-13 established for that company under this title unless the commission
35-14 approves the proposed change as authorized under Subsection (c) or
35-15 (d).
35-16 (b) For purposes of Subsection (a), the company's previously
35-17 established rates are the rates charged by the company on its
35-18 election date without regard to a proceeding pending under:
35-19 (1) Section 15.001;
35-20 (2) Subchapter D, Chapter 53; or
35-21 (3) Subchapter G, Chapter 2001, Government Code.
35-22 (c) The commission, on motion of the electing company or on
35-23 its own motion, shall adjust prices for services to reflect changes
35-24 in Federal Communications Commission separations that affect
35-25 intrastate net income by at least 10 percent.
35-26 (d) Notwithstanding Subsection (a), the [The] commission, on
36-1 request of the electing company, shall allow a rate group
36-2 reclassification that results from access line growth.
36-3 (e) Section 58.059 applies to a rate change under this
36-4 section.
36-5 SECTION 29. Section 59.025, Utilities Code, is amended to
36-6 read as follows:
36-7 Sec. 59.025. SWITCHED ACCESS RATES. Notwithstanding any
36-8 other provision of this title, the commission may not, on the
36-9 commission's own motion, reduce an electing company's rates for
36-10 switched access services before the expiration of the election
36-11 [six-year] period prescribed by Section 59.024, but may approve a
36-12 reduction proposed by the electing company.
36-13 SECTION 30. Subsection (a), Section 59.026, Utilities Code,
36-14 is amended to read as follows:
36-15 (a) On or before the end [sixth anniversary] of the
36-16 company's election period [date], an electing company is not,
36-17 under any circumstances, subject to:
36-18 (1) a complaint or hearing regarding the
36-19 reasonableness of the company's:
36-20 (A) rates;
36-21 (B) overall revenues;
36-22 (C) return on invested capital; or
36-23 (D) net income; or
36-24 (2) a complaint that a rate is excessive.
36-25 SECTION 31. Subchapter B, Chapter 59, Utilities Code, is
36-26 amended by adding Sections 59.030, 59.031, and 59.032 to read as
37-1 follows:
37-2 Sec. 59.030. NEW SERVICES. (a) An electing company may
37-3 introduce a new service 10 days after providing an informational
37-4 notice to the commission and to any person who holds a certificate
37-5 of operating authority in the electing company's certificated area
37-6 or areas or who has an effective interconnection agreement with the
37-7 electing company.
37-8 (b) An electing company shall price each new service at or
37-9 above the service's long run incremental cost. The commission
37-10 shall allow a company serving fewer than one million access lines
37-11 to establish a service's long run incremental cost by adopting, at
37-12 that company's option, the cost studies of a larger company for
37-13 that service that has been accepted by the commission.
37-14 (c) Only an affected person may file a complaint with the
37-15 commission challenging whether the pricing by an electing company
37-16 of a new service is in compliance with Subsection (b).
37-17 (d) If an affected person files a complaint under Subsection
37-18 (c), the electing company has the burden of proving that the
37-19 company set the price for the new service in accordance with the
37-20 applicable provisions of this subchapter. If the complaint is
37-21 finally resolved in favor of the complainant, the electing company:
37-22 (1) shall, not later than the 10th day after the date
37-23 the complaint is finally resolved, amend the price of the service
37-24 as necessary to comply with the final resolution; or
37-25 (2) may, at the company's option, discontinue the
37-26 service.
38-1 Sec. 59.031. PRICING AND PACKAGING FLEXIBILITY.
38-2 (a) Notwithstanding Section 59.027(b) or Subchapter F, Chapter 60,
38-3 an electing company may exercise pricing flexibility in accordance
38-4 with this section, including the packaging of any regulated service
38-5 such as basic local telecommunications service with any other
38-6 regulated or unregulated service or any service of an affiliate.
38-7 The electing company may exercise pricing flexibility 10 days after
38-8 providing an informational notice to the commission and to any
38-9 person who holds a certificate of operating authority in the
38-10 electing company's certificated area or areas or who has an
38-11 effective interconnection agreement with the electing company.
38-12 Pricing flexibility includes all pricing arrangements included in
38-13 the definition of "pricing flexibility" prescribed by Section
38-14 51.002(7) and includes packaging of regulated services with
38-15 non-regulated services or services of an affiliate, except that
38-16 such a package may not be offered in a manner that results in a
38-17 customer-specific contract.
38-18 (b) An electing company, at the company's option, shall
38-19 price each regulated service offered separately or as part of a
38-20 package under Subsection (a) at either the service's tariffed rate
38-21 or at a rate not lower than the service's long run incremental
38-22 cost. The commission shall allow a company serving fewer than one
38-23 million access lines to establish a service's long run incremental
38-24 cost by adopting, at that company's option, the cost studies of a
38-25 larger company for that service that have been accepted by the
38-26 commission.
39-1 (c) Only an affected person may file a complaint alleging
39-2 that an electing company has priced a regulated service in a manner
39-3 that does not meet the pricing standards of this subchapter. The
39-4 complaint must be filed before the 31st day after the company
39-5 implements the rate.
39-6 Sec. 59.032. CUSTOMER PROMOTIONAL OFFERINGS. (a) An
39-7 electing company may offer a promotion for a regulated service for
39-8 not more than 90 days in any 12-month period.
39-9 (b) The electing company shall file with the commission a
39-10 promotional offering that consists of:
39-11 (1) waiver of installation charges or service order
39-12 charges, or both, for not more than 90 days in a 12-month period;
39-13 or
39-14 (2) a temporary discount of not more than 25 percent
39-15 from the tariffed rate for not more than 60 days in a 12-month
39-16 period.
39-17 (c) An electing company is not required to obtain commission
39-18 approval to make a promotional offering described by Subsection
39-19 (b).
39-20 (d) An electing company may offer a promotion of any
39-21 regulated service as part of a package of services consisting of
39-22 any regulated service with any other regulated or unregulated
39-23 service or any service of an affiliate.
39-24 SECTION 32. Section 60.124, Utilities Code, is amended to
39-25 read as follows:
39-26 Sec. 60.124. INTEROPERABLE NETWORKS REQUIRED. (a) The
40-1 commission shall require each telecommunications provider to
40-2 maintain interoperable networks and shall require that
40-3 interconnection agreements between incumbent local exchange
40-4 companies and competitive local exchange companies contain
40-5 self-executing performance penalties for incumbent noncompliance
40-6 with contract provisions that impair a competitor's ability to
40-7 provide service to its customers.
40-8 (b) The commission may:
40-9 (1) adopt rules, including generic rules that are
40-10 responsive to changes in federal law or a development in the local
40-11 exchange market; and
40-12 (2) set policies governing interconnection
40-13 arrangements.
40-14 SECTION 33. Subchapter I, Chapter 60, Utilities Code, is
40-15 amended by adding Sections 60.164 and 60.165 to read as follows:
40-16 Sec. 60.164. PERMISSIBLE JOINT MARKETING. Except as
40-17 prescribed in Chapters 61 and 63, the commission shall not adopt
40-18 any rule or order that would prohibit a local exchange company from
40-19 jointly marketing or selling its products and services with the
40-20 products and services of any of its affiliates in any manner
40-21 permitted by federal law or applicable rules of the Federal
40-22 Communications Commission.
40-23 Sec. 60.165. AFFILIATE RULE. Except as prescribed in
40-24 Chapters 61 and 63, the commission shall not adopt any rule or
40-25 order that would prescribe for any local exchange company any
40-26 affiliate rule, including any accounting rule, any cost allocation
41-1 rule, or any structural separation rule, that is more burdensome
41-2 than federal law or applicable rules of the Federal Communications
41-3 Commission. Notwithstanding any other provision in this title, the
41-4 commission shall not attribute or impute to a local exchange
41-5 company a price discount offered by an affiliate of the local
41-6 exchange company to the affiliate's customers. This section does
41-7 not limit the authority of the commission to consider a complaint
41-8 brought under Subchapter A, Chapter 52, Section 53.003, or this
41-9 chapter.
41-10 SECTION 34. The importance of this legislation and the
41-11 crowded condition of the calendars in both houses create an
41-12 emergency and an imperative public necessity that the
41-13 constitutional rule requiring bills to be read on three several
41-14 days in each house be suspended, and this rule is hereby suspended,
41-15 and that this Act take effect and be in force from and after its
41-16 passage, and it is so enacted.