By Flores                                              H.B. No. 649
         77R2229 CBH-D                           
                                A BILL TO BE ENTITLED
 1-1                                   AN ACT
 1-2     relating to reduced rates for certain telecommunications services
 1-3     for nonprofit organizations.
 1-4           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
 1-5           SECTION 1.  The heading to Subchapter B, Chapter 57,
 1-6     Utilities Code, is amended to read as follows:
 1-7        SUBCHAPTER B.  DISTANCE LEARNING, [AND] INFORMATION SHARING,
 1-8                         AND OTHER RELATED SERVICES
 1-9           SECTION 2.  Section 57.021, Utilities Code, is amended by
1-10     adding Subdivision (4) to read as follows:
1-11                 (4)  "Nonprofit organization" means an organization
1-12     that is exempt from federal income tax under Section 501(a),
1-13     Internal Revenue Code of 1986, as amended, by being listed as an
1-14     exempt organization in Section 501(c) of the code.
1-15           SECTION 3.  Section 57.022, Utilities Code, is amended to
1-16     read as follows:
1-17           Sec. 57.022.  REDUCED RATES [FOR DISTANCE LEARNING OR
1-18     INFORMATION SHARING SERVICES].  (a)  The commission by rule shall
1-19     require a dominant carrier to file a tariff that includes a reduced
1-20     rate for a telecommunications service the commission finds is
1-21     directly related to:
1-22                 (1)  a distance learning activity that is or could be
1-23     conducted by an educational institution in this state; or
1-24                 (2)  an information sharing program that is or could be
 2-1     conducted by a library in this state.
 2-2           (b)  The commission by rule shall require a dominant carrier
 2-3     to file a tariff that includes a reduced rate for a
 2-4     telecommunications service that a nonprofit organization requires
 2-5     to access the Internet if the organization uses or plans to use the
 2-6     Internet to assist the organization in providing services or
 2-7     achieving its purposes.
 2-8           (c)  The commission rules shall specify:
 2-9                 (1)  each telecommunications service to which
2-10     Subsection (a) or (b) applies;
2-11                 (2)  the process for an educational institution, [or]
2-12     library, or nonprofit organization to qualify for a reduced rate;
2-13                 (3)  the date by which a dominant carrier is required
2-14     to file a tariff;
2-15                 (4)  guidelines and criteria that require the services
2-16     and reduced rates to further the goals prescribed by Section
2-17     57.023; and
2-18                 (5)  any other requirement or term that the commission
2-19     determines to be in the public interest.
2-20           (d) [(c)]  The commission is not required to determine the
2-21     long run incremental cost of providing a service before approving a
2-22     reduced rate for the service.
2-23           (e) [(d)]  Until cost determination rules are developed and
2-24     the rates established under this section are changed as necessary
2-25     to ensure proper cost recovery, the reduced rates established by
2-26     the commission shall be equal to 75 percent of the otherwise
2-27     applicable rate.
 3-1           (f) [(e)]  After the commission develops cost determination
 3-2     rules for telecommunications services generally, the commission
 3-3     shall ensure that a reduced rate approved under this section:
 3-4                 (1)  recovers service-specific long run incremental
 3-5     costs; and
 3-6                 (2)  avoids subsidizing an educational institution,
 3-7     [or] a library, or a nonprofit organization.
 3-8           SECTION 4.  Section 57.023, Utilities Code, is amended to
 3-9     read as follows:
3-10           Sec. 57.023.  SERVICE AND RATE REQUIREMENTS.  (a)  The
3-11     services and reduced rates for educational institutions and
3-12     libraries must be designed to:
3-13                 (1)  encourage the development and offering of:
3-14                       (A)  distance learning activities by educational
3-15     institutions; and
3-16                       (B)  information sharing programs of libraries;
3-17     and
3-18                 (2)  meet the:
3-19                       (A)  distance learning needs identified by the
3-20     educational community; and
3-21                       (B)  information sharing needs identified by
3-22     libraries.
3-23           (b)  The services and reduced rates for nonprofit
3-24     organizations must be designed to assist the organization in using
3-25     the Internet to provide services or achieve its purposes.
3-26           (c)  The services and reduced rates required by this section
3-27     must be designed to[; and]
 4-1                 [(3)]  recover the long run incremental costs of
 4-2     providing the services, to the extent those costs can be
 4-3     identified, to avoid subsidizing an educational institution, [or] a
 4-4     library, or a nonprofit organization.
 4-5           SECTION 5.  Section 57.025(a), Utilities Code, is amended to
 4-6     read as follows:
 4-7           (a)  An educational institution, library, nonprofit
 4-8     organization, or dominant carrier may request the commission to:
 4-9                 (1)  provide for a reduced rate for a service that:
4-10                       (A)  is directly related to furthering a goal
4-11     prescribed by Section 57.023 [a distance learning activity or an
4-12     information sharing program]; and
4-13                       (B)  is not covered by commission rules;
4-14                 (2)  change a rate;
4-15                 (3)  amend a tariff; or
4-16                 (4)  amend a commission rule.
4-17           SECTION 6.  This Act takes effect September 1, 2001.  The
4-18     Public Utility Commission of Texas shall adopt rules providing a
4-19     reduced rate for nonprofit organizations not later than January 1,
4-20     2002.