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Alternative forms of regulation - 66 Pa. Cons. Stat. § 3015Legal Research Home > Pennsylvania Statutes
§ 3015. Alternative forms of regulation.
(a) Inflation offset.--
(1) Except as otherwise provided in paragraphs (2) and
(3), a local exchange telecommunications company with an
alternative form of regulation containing a price stability
mechanism that files an amended network modernization plan
under section 3014(b)(1), (2) or (3) (relating to network
modernization plans) shall be subject to a modified inflation
offset in its price stability mechanism in adjusting its
rates for noncompetitive services, effective upon the filing
of an amended network modernization plan under section
3014(e), as follows:
(i) If a nonrural telecommunications carrier files
an amended network modernization plan under section
3014(b)(3) that commits to deploy 100% broadband
availability by December 31, 2013, then the carrier's
inflation offset shall be zero.
(ii) If a nonrural telecommunications carrier files
an amended network modernization plan under section
3014(b)(3) that commits to deploy 100% broadband
availability by December 31, 2015, then the carrier's
inflation offset shall be equal to 0.5%.
(iii) If a rural telecommunications carrier files an
amended network modernization plan under section
3014(b)(1) that commits to deploy 100% broadband
availability by December 31, 2008, or under section
3014(b)(2)(ii)(A) that commits to deploy 100% broadband
availability by December 31, 2013, then the carrier's
inflation offset shall be zero.
(iv) If a rural telecommunications carrier files an
amended network modernization plan under section
3014(b)(2)(ii)(B) that commits to deploy 100% broadband
availability by December 31, 2015, then the carrier's
inflation offset shall be equal to 0.5%.
(2) Utilizing network modernization plan reports filed
with the commission by local exchange telecommunications
companies under section 3014(f), the commission shall monitor
and enforce companies' compliance with their interim and
final 100% commitments for broadband availability in their
amended network modernization plans. In the event that a
local exchange telecommunications company is found by the
commission, after notice and evidentiary hearings held on an
expedited basis, to have failed to meet such an interim or
final 100% commitment, then the commission shall require the
local exchange telecommunications company to refund to
customers in its next price stability filing an amount that
is just and reasonable under the circumstances. Such amount
shall not exceed an amount determined by multiplying the
percentage shortfall of the broadband availability commitment
on an access-line basis required to be met during the period
from the start of the amended plan or from the date of the
last prior interim commitment, as applicable, times the
increased revenue that was obtained during this period as a
result of the modified inflation offset provided in this
section that reduced the inflation offset applicable in the
local exchange telecommunications company's alternative
regulation plan in effect on the effective date of this
section, plus interest calculated under section 1308(d)
(relating to voluntary changes in rates). Any such refund
required under this subsection shall be separate from and in
addition to any civil or other penalties that the commission
may impose on a local exchange telecommunications company
under Chapter 33 (relating to violations and penalties).
(3) Where annual rate adjustments made under a nonrural
telecommunications carrier's price stability mechanism are
calculated using revenues from protected services, an average
rate adjustment for protected residential customer local
exchange telecommunications service lines shall be determined
by dividing the total protected service revenues associated
with such lines, as adjusted by the price stability formula,
by the number of such lines, and the rate adjustment for any
individual line shall not vary from this average rate
adjustment by more than 20%.
(b) Rate changes for rural telecommunications carriers.--
(1) In addition to the rate change provisions in its
alternative form of regulation plan, a rural
telecommunications carrier operating without a price
stability mechanism that files with the commission an amended
network modernization plan under section 3014(b)(1) or (2)
shall be permitted at any time to file proposed tariff
changes with the commission, effective 45 days after filing,
setting forth miscellaneous changes, including increases and
decreases, in rates for noncompetitive services, excluding
basic residential and business rates, provided such rate
changes do not increase the rural telecommunications
carrier's annual intrastate revenues by more than 3%.
(2) The commission tariff filing requirements and review
associated with such proposed rate changes shall be limited
to schedules submitted by the rural telecommunications
carrier detailing the impact of the rate changes on the
carrier's annual intrastate revenues.
(3) A rural telecommunications carrier that implements
noncompetitive rate changes consistent with the procedure set
forth in its alternative form of regulation plan shall be
required only to file such financial and cost data with the
commission to justify such changes as is required under its
commission-approved alternative form of regulation plan.
(4) Notwithstanding the provisions of paragraph (1), (2)
or (3), for any rural telecommunications carrier serving less
than 50,000 access lines in this Commonwealth and operating
under an alternative form of regulation plan, a formal
complaint to deny rate changes for noncompetitive services
unless signed by at least 20 customers of the rural
telecommunications carrier shall not prevent implementation
of the rate changes pending the adjudication of the formal
complaint by the commission.
(c) Broadband Outreach and Aggregation Fund.--
(1) There is hereby established within the State
Treasury a special fund to be known as the Broadband Outreach
and Aggregation Fund for the purposes enumerated in section
3014(i).
(2) A local exchange telecommunications company that
files an amended network modernization plan under section
3014(b)(2) or (3) shall be assessed by the commission for
contribution to the fund and to the E-fund established under
subsection (d) an amount of 20% of the first year's annual
revenue effect:
(i) of any rate increase permitted by the
elimination or reduction of the offset under subsection
(a) and placed into effect; or
(ii) of any rate increase placed into effect under
subsection (b)(1) if the local exchange
telecommunications company is operating without a price
stability mechanism.
For purposes of this paragraph, the term "first year's annual
revenue effect" means the projected or actual increased
revenues received by the local exchange telecommunications
company during the one-year period from the effective date of
its rate increase. The commission shall begin the assessments
provided for in this paragraph on June 30, 2005, and
thereafter shall make such assessments annually on June 30
until June 30, 2010, for assessments that include amounts for
the fund and the e-fund and until June 30, 2015, for
assessments that include amounts for only the fund. Each
assessment shall be based on the first year's annual revenue
effect of any covered rate increase effective after the date
of the last annual assessment.
(3) An amount not to exceed 50% of such assessment shall
be allocated to the fund. The remainder of the assessment
shall be allocated to the E-fund provided for under
subsection (d) until its termination on June 30, 2011. After
the E-fund termination, the maximum assessment percentage
shall be reduced from 20% to 10%, and contributions shall be
made only to the fund until the local exchange
telecommunications company achieves 100% broadband
availability. Contributions of allocated amounts shall be
paid to the fund and the E-fund by the local exchange
telecommunications company in equal quarterly installments.
(4) In no event shall the total amount of the fund
exceed $5,000,000 annually, and in the event of such
overfunding the department shall credit the overcollection to
the next year's contribution amount.
(5) A local exchange telecommunications company that
elects to amend its network modernization plan pursuant to
section 3014 (b)(1) shall not be required to contribute to
the fund.
(6) The moneys in the Broadband Outreach and Aggregation
Fund are hereby appropriated upon approval of the Governor to
the department for the purposes enumerated in paragraph (1).
The department may use up to 3% of the money in the fund for
administration.
(7) The fund shall continue until July 1, 2016, at which
time the fund shall terminate, and the department shall
return any funds remaining in the fund on a pro rata basis to
the local exchange telecommunications companies that
contributed to the fund.
(d) Education Technology Fund (E-Fund).--
(1) There is hereby established within the State
Treasury a special fund to be known as the Education
Technology Fund (E-Fund) for the purposes enumerated in
paragraph (4).
(2) All E-fund assessments imposed by the commission
under subsection (c)(2) and paragraph (3), moneys
specifically appropriated by the General Assembly for the
purposes of this subsection and any funds, contributions or
payments which may be made available to the fund by the
Federal Government, another State agency or any public or
private source for the purpose of implementing this
subsection shall be deposited in the E-Fund.
(3) Beginning in 2005 and continuing through 2010, the
commission shall, no later than June 30, annually assess each
nonrural telecommunications carrier that files an amended
network modernization plan under section 3014(b)(3) an amount
to be deposited in the E-Fund. Each carrier's annual
assessment shall be payable in two equal installments due on
October 31 of each year and January 31 of the following year
and shall be based on the relative proportion of the retail
access lines served by the nonrural telecommunications
carrier in relation to the number of retail access lines
served by all nonrural telecommunications carriers that have
filed an amended network modernization plan under section
3014(b)(3). For fiscal years 2005-2006 and 2006-2007, the
total annual assessment amount shall be $7,000,000. For
fiscal years 2007-2008, 2008-2009, 2009-2010 and 2010-2011,
the total annual assessment amount shall be the difference
between $7,000,000 and any amount remaining in the E-Fund
from prior fiscal years which remains unencumbered or
unexpended. A nonrural telecommunications carrier's
assessments required under this paragraph may not be
recovered via a surcharge on customers' bills or in rates for
noncompetitive services as exogenous change adjustment under
the provisions of the carrier's price stability mechanism and
subsection (a)(3) where applicable.
(4) Additional local exchange telecommunications company
contributions to the E-fund shall be made pursuant to the
provisions of subsections (c)(2) and (3).
(5) The Department of Education shall expend the moneys
of the E-Fund for the purpose of providing grants to school
entities as prescribed by section 3014(j).
(6) The moneys of the Education Technology Fund are
hereby appropriated upon approval of the Governor to the
Department of Education for the purposes enumerated in
paragraph (5). The Department of Education may use up to 3%
of the money for administration. Appropriations by the
General Assembly to the fund shall be continuing
appropriations and shall not lapse at the close of any fiscal
year.
(7) The E-Fund shall continue until June 30, 2011, at
which time the fund shall terminate and the Department of
Education shall return any funds remaining therein on a pro
rata basis to the local exchange telecommunications companies
that contributed to the fund.
(e) General filing requirements.--The commission's filing
and audit requirements for a local exchange telecommunications
company that is operating under an amended network modernization
plan shall be limited to the following:
(1) Network modernization plan reports filed pursuant to
section 3014(f).
(2) An annual financial report consisting of a balance
sheet and income statement.
(3) An annual deaf, speech-impaired and hearing-impaired
relay information report.
(4) An annual service report.
(5) Universal service reports.
(6) An annual access line report.
(7) An annual statement of gross intrastate operating
revenues for purposes of calculating assessments for
regulatory expenses.
(8) An annual State tax adjustment computation for years
in which a tax change has occurred, if applicable.
(9) For those companies with a bona fide retail request
program, a bona fide retail request report under section
3014(c)(9). These reports shall be submitted in the form
determined by the commission.
(f) Other reports.--
(1) Notwithstanding any other provision of this title to
the contrary, no report, statement, filing or other document
or information, except as specified in subsection (e), shall
be required of any local exchange telecommunications company
unless the commission, upon notice to the affected local
exchange telecommunications company and an opportunity to be
heard, has first made specific written findings supporting
conclusions in an entered order that:
(i) The report is necessary to ensure that the local
exchange telecommunications company is charging rates
that are in compliance with this chapter and its
effective alternative form of regulation.
(ii) The benefits of the report substantially
outweigh the attendant expense and administrative time
and effort required of the local exchange
telecommunications company to prepare it.
(2) Nothing in this subsection shall be construed to
impede the ability of the commission to require the
submission of further information to support the accuracy of
or to seek an explanation of the reports specified in
subsection (e).
(g) Rate change limitations.--Nothing in this chapter shall
be construed to limit the requirement of section 1301 (relating
to rates to be just and reasonable) that rates shall be just and
reasonable. The annual rate change limitations set forth in a
local exchange telecommunications company's effective
commission-approved alternative form of regulation plan or any
other commission-approved annual rate change limitation shall
remain applicable and shall be deemed just and reasonable under
section 1301.
(h) Conformance of plan.--Upon approval of a local exchange
telecommunications company of network modernization plan
amendments pursuant to section 3014(e), the local exchange
telecommunications company's alternative form of regulation plan
shall be deemed amended consistent with this section.
(Nov. 30, 2004, P.L.1398, No.183, eff. imd.)
2004 Amendment. Act 183 added section 3015.
Cross References. Section 3015 is referred to in sections
3012, 3014, 3019 of this title.
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Last modified: November 27, 2007 |