*Pages 1--8 from Microsoft Word - 14546.doc* Federal Communications Commission DA 02- 234 Before the Federal Communications Commission Washington, D. C. 20554 In the Matter of December 17, 2001 MAG Access Charge Tariff Filings ) ) ) ) ) ) CCB/ CPD File No. 01- 23 ORDER ON RECONSIDERATION Adopted: January 30, 2002 Released: January 30, 2002 By the Chief, Competitive Pricing Division: I. INTRODUCTION 1. On December 31, 2001, we released the Suspension Order, which suspended for one day and set for investigation tariffs containing rates for interstate access services filed by certain incumbent local exchange carriers subject to rate- of- return regulation. 1 We suspended these tariffs to ensure that all of the carriers had complied with the access charge reforms adopted by the Commission in the Rate- of- Return Access Charge Reform Order. 2 After thoroughly reviewing the carriers’ tariffs and the subsequent revisions to those tariffs, 3 we now find that, with two exceptions discussed below, the carriers have substantially complied with the Rate- of- Return Access Charge Reform Order and their tariffs no longer warrant investigation. Accordingly, on our own motion, we reconsider our decision to suspend and investigate the rates for interstate access services filed by the carriers listed in Appendix B of this order. 1 December 17, 2001 MAG Access Charge Tariff Filings, CCB/ CPD File No. 01- 23, Order, DA 01- 3023 (released Dec. 31, 2001); December 17, 2001 MAG Access Charge Tariff Filings, CCB/ CPD File No. 01- 23, Erratum, DA 01- 3032 (released Dec. 31, 2001) (collectively Suspension Order). Appendix A of the Suspension Order lists the carriers and their suspended tariffs, and includes all rate- of- return carriers filing interstate access charge tariffs effective January 1, 2002. 2 Multi- Association Group (MAG) Plan for Regulation of Interstate Services of Non- Price Cap Incumbent Local Exchange Carriers and Interexchange Carriers, CC Docket No. 00- 256, Second Report and Order and Further Notice of Proposed Rulemaking, FCC 01- 304 (released Nov. 8, 2001) (Rate- of- Return Access Charge Reform Order). The one- day suspension allowed the tariffs to become effective after the suspension, subject to potential refund obligations pending the outcome of our investigation. See Suspension Order, DA 01- 3023 at 1- 2 n. 4. 3 Appendix A lists the tariff transmittals filed after the Suspension Order was released. 1 Federal Communications Commission DA 02- 234 2 II. BACKGROUND 2. In the Rate- of- Return Access Charge Reform Order, the Commission adopted comprehensive interstate access charge and universal service reforms for rate- of- return carriers. Among other things, the Commission revised several of the access charge rules contained in Part 69 of its rules, effective January 1, 2002. The revisions increased, as of January 1, 2002, the residential and single- line business subscriber line charge (SLC) cap and the multi- line business SLC cap to $5.00 and $9.20 per line, respectively, 4 or, if less than the cap, the monthly cost per line. 5 Carriers must recover their contributions to universal service from a separately stated charge assessed on end users, rather than through access charges. 6 Line port costs must be reallocated from local switching to the common line category. 7 The costs recovered through the transport interconnection charge (TIC) are to be reallocated among all the access categories, subject to a specific dollar limit equal to the TIC revenues for the twelve months ending June 30, 2001. 8 These cost reallocations require reassignment of certain costs from specified interstate access categories to the common line category. Many rate- of- return LECs file their own traffic-sensitive tariffs, but participate in the National Exchange Carrier Association (NECA) common line tariff. Therefore, the line port costs and certain TIC costs of LECs that file their own traffic-sensitive tariffs must be removed from the LECs’ revenue requirements and included in the NECA common line pool’s revenue requirement. 3. In the Suspension Order, based on our own review of the carriers’ tariffs and petitions filed by AT& T Corp. (AT& T) and General Communication, Inc. (GCI), we suspended and set for investigation the rates for interstate access services filed by the carriers listed in Appendix A of that order. 9 In general, we were concerned that some carriers had not properly allocated line port costs to the common line category and had not properly reallocated TIC costs among the other access charge categories. Because the reallocations required certain costs to be shifted from the tariffs of carriers filing their own traffic- sensitive tariffs to the NECA common line tariff, this affected the calculation of the SLC and carrier common line rates for the NECA tariff. 4 See Rate- of- Return Access Charge Reform Order, FCC 01- 304 at 22- 29, paras. 42- 56. 5 47 C. F. R. § 69. 104, as revised. See Rate- of- Return Access Charge Reform Order, FCC 01- 304 at 26, para. 51. 6 See Rate- of- Return Access Charge Reform Order, FCC 01- 304 at 76- 77, para. 177. 7 See Rate- of- Return Access Charge Reform Order, FCC 01- 304 at 42, para. 90. 8 See Rate- of- Return Access Charge Reform Order, FCC 01- 304 at 37, 46, paras. 76, 103; MAG Plan for Regulation of Interstate Services of Non- Price Cap Incumbent Local Exchange Carriers and Interexchange Carriers, CC Docket No. 00- 256, Declaratory Ruling, DA 01- 2871, 2- 3, paras. 3- 5 (released Dec. 11, 2001) (Declaratory Ruling). 9 See Suspension Order, DA 01- 3023 at 3, para. 5. See generally Petition of General Communication, Inc. (filed Dec. 21, 2001) (GCI Petition); Petition of AT& T Corp. (filed Dec. 26, 2001) (AT& T Petition). 2 Federal Communications Commission DA 02- 234 3 III. DISCUSSION 4. Since issuing the Suspension Order, we have analyzed the initial tariffs, corresponded with the parties, and examined supplemental data and tariff revisions filed by several carriers. Based on our review of the record, including these tariff revisions, we conclude the tariffs listed in Appendix B of this order do not raise issues that warrant investigation. We therefore reconsider, on our own motion, our decision to suspend and investigate the rates for interstate access services of the carriers listed in Appendix B and hereby terminate our investigat ion of those rates. 5. We continue our investigation, however, of the rates filed by Alaska Communications System (ACS), because the issues identified in the Suspension Order regarding ACS have not been resolved. 10 Due to the interrelationship between ACS’ individual tariff and the tariff for the NECA common line pool, that NECA tariff must also remain under investigat ion. 11 The specific issues that are the subject of the investigation will be identified in an upcoming designation order. 6. We also take this opportunity to clarify how rate- of- return carriers are to perform the line port cost reallocation required by the Rate- of- Return Access Charge Reform Order in their upcoming annual access tariff filings. The Rate- of- Return Access Charge Reform Order requires LECs to reallocate line port costs from local switching to the common line category, either by conducting a cost study, or by using thirty percent of the local switching category revenue requirement as a default proxy. 12 Most carriers that do not participate in the NECA traffic- sensitive pool filed their rates using projected amounts based on NECA’s updated data derived from its role as pool administrator. Although this resulted in some carriers reallocating amounts other than thirty percent of their historical local switching revenue requirement to the common line category, we conclude that this methodology comports with the intent of the Commission’s access charge reforms and does not warrant investigation in the context of this partial year tariff filing. In accordance with our line port reallocation rules, 13 rate- of- return carriers electing to use the thirty percent proxy in future tariff filings shall reallocate thirty percent of the revenue requirement for the test period underlying their tariff filing to the common line category. Thus, section 61.38 carriers 14 shall apply the thirty percent proxy to their projected 10 In the Suspension Order, we identified at least two issues warranting investigation: (1) whether ACS improperly allocated ISP minutes to both the interstate and local jurisdictions in violation of the Commission’s order in GCI v. ACS Holdings; and (2) whether ACS correctly reallocated line port costs from the local switching revenue requirement. See Suspension Order, DA 01- 3023 at 4, para. 7. See also General Communication, Inc. v. Alaska Communications Systems Holdings, 16 FCC Rcd 2834 (2001), appeal docketed, No. 01- 1059 (D. C. Cir.) (GCI v. ACS Holdings). We also noted that we may designate additional issues for investigation. See Suspension Order, DA 01- 3023 at 5, para. 9. 11 We clarify that NECA’s access charges relating to the traffic- sensitive pool and its special access rates are no longer under investigation. NECA’s tariff rates associated with its common line pool, however, remain suspended and subject to investigation. 12 See Rate- of- Return Access Charge Reform Order, FCC 01- 304 at 42, para. 90. 13 47 C. F. R. § 69. 306( d). 3 Federal Communications Commission DA 02- 234 4 local switching revenue requirement, while section 61.39 carriers 15 shall apply the thirty percent proxy to their historical local switching revenue requirement. IV. ORDERING CLAUSES 7. Accordingly, IT IS ORDERED that, pursuant to section 204 of the Communications Act of 1934, as amended, 47 U. S. C. § 204, and sections 0.91, 0.291 and 1.108 of the Commission’s rules, 47 C. F. R. §§ 0. 91, 0.291, and 1.108, we reconsider, on our own motion, our decision in the Suspension Order to suspend and investigate the rates for interstate access services filed by the carriers listed in Appendix B. 8. IT IS FURTHER ORDERED that, pursuant to section 204 of the Communications Act of 1934, as amended, 47 U. S. C. § 204, and sections 0.91 and 0.291 of the Commission’s rules, 47 C. F. R. §§ 0.91 and 0.291, the investigation and accounting order imposed in CCB/ CPD File No. 01- 23 IS TERMINATED with respect to the carriers listed in Appendix B. 9. IT IS FURTHER ORDERED that, pursuant to section 204 of the Communications Act of 1934, as amended, 47 U. S. C. § 204, and sections 0.91 and 0.291 of the Commission's rules, 47 C. F. R. §§ 0.91 and 0.291, the investigation and accounting order imposed in CCB/ CPD File No. 01- 23 IS TERMINATED with respect to the traffic- sensitive and special access rates filed by the National Exchange Carrier Association. FEDERAL COMMUNICATIONS COMMISSION Tamara L. Preiss Chief, Compet it ive Pricing Division Common Carrier Bureau 14 47 C. F. R. § 61. 38. 15 47 C. F. R. § 61. 39. 4 Federal Communications Commission DA 02- 234 5 APPENDIX A TARIFFS FILED BY RATE- OF- RETURN CARRIERS AFTER JANUARY 1, 2002 IN THE DECEMBER 17, 2001 MAG ACCESS CHARGE TARIFF FILING PROCEEDING FILER TRANSMITTAL # Issued: January 29, 2002 Effective: January 30, 2002 Century Telephone Operating Companies Transmittal No. 17 Telephone Utilities Exchange Carrier Assoc. (TUECA) Transmittal No. 171 Issued: January 29, 2002 Effective: February 1, 2002 ICORE, Inc. Transmittal No. 37 NTELOS Telephone, Inc. Transmittal No. 5 Issued: January 30, 2002 Effective: February 6, 2002 Lexcom Telephone Company Transmittal No. 7 South Central Telephone Association Transmittal No. 11 Southern Kansas Telephone Company Transmittal No. 12 5 Federal Communications Commission DA 02- 234 6 APPENDIX B INVESTIGATION TERMINATED FOR THE FOLLOWING TARIFFS FILED BY RATE- OF- RETURN CARRIERS IN THE DECEMBER 17, 2001 MAG ACCESS CHARGE TARIFF FILING PROCEEDING FILER TRANSMITTAL # Issued: December 14, 2001 Effective: January 1, 2002 Madison River Telephone Company, LLC Transmittal No. 2 (Gallatin River & Gulf Telephone Cos.) Issued: December 17, 2001 Effective: January 1, 2002 Alltel Telephone System Transmittal No. 95 Bay Springs Telephone Company Transmittal No. 82 Beehive Telephone Companies Transmittal No. 22 Bixby Telephone Company Transmittal No. 7 Blue Earth Valley Telephone Company Transmittal No. 4 Century Telephone Companies Transmittal No. 14 The Champaign Telephone Company Transmittal No. 3 Chariton Valley Telphone Corporation Transmittal No. 6 Chillicothe Telephone Company Transmittal No. 68 City of Brookings Municipal Telephone Department Transmittal No. 13 Contoocook Valley Telephone Company Transmittal No. 11 Dunkirk & Fredonia Telephone Company Transmittal No. 27 East Ascension Telephone Company, Inc. Transmittal No. 4 Easton Telephone Company Transmittal No. 3 Eckles Telephone Company Transmittal No. 3 Elkhart Telephone Company Transmittal No. 58 Etex Telephone Cooperative Transmittal No. 7 Fidelity Telephone Company Transmittal No. 12 Geneseo Telephone Company Transmittal No. 5 Great Plains Communications, Inc. Transmittal No. 75 Gridley Telephone Company Transmittal No. 4 GVNW Inc/ Management Transmittal No. 179 Harrisonville Telephone Company Transmittal No. 23 Hills Telephone Company (Iowa) Transmittal No. 3 ICORE Transmittal No. 35 Illinois Consolidated Telephone Company Transmittal No. 111 James Valley Cooperative Telephone Company Transmittal No. 3 John Staurulakis, Inc. (JSI) Transmittal No. 63 Leaf River Telephone Company Transmittal No. 4 Lexcom Telephone Company Transmittal No. 5 McCook Cooperative Telephone Company Transmittal No. 2 Midstate Telephone Company Transmittal No. 5 Minnesota Lake Telephone Company Transmittal No. 3 6 Federal Communications Commission DA 02- 234 7 Moultrie Independent Telephone Company Transmittal No. 11 National Exchange Carrier Association (NECA) Transmittal No. 919 16 NTELOS Telephone Company Transmittal No. 3 Puerto Rico Telephone Company Transmittal No. 43 Roseville Telephone Company Transmittal No. 85 Shell Rock Telephone Company Transmittal No. 3 Sioux Valley Telephone Company Transmittal No. 3 Smart City Telecommunications LLC Transmittal No. 6 Smithville Telephone Company Transmittal No. 4 South Central Telephone Association Transmittal No. 8 Southern Kansas Telephone Company Transmittal No. 10 Splitrock Telecom Cooperative, Inc. Transmittal No. 4 Telephone Utilities Exchange Carrier Assoc. (TUECA) Transmittal No. 168 Tri- Count y Telephone Associat ion Transmittal No. 7 TXU Communications Telephone Company Transmittal No. 7 Union Telephone Company Transmittal No. 71 Utelco, Inc. Transmittal No. 8 Virgin Islands Telephone Corporation Transmittal No. 45 Winterhaven Telephone Company Transmittal No. 9 Issued: December 18, 2001 Bay Springs Telephone Company Transmittal No. 82 - Amended Elkhart Telephone Company Transmittal No. 58 - Amended Issued: December 19, 2001 Utelco, Inc. Transmittal No. 8 - Amended Winterhaven Telephone Company Transmittal No. 9 - Amended Issued: December 21, 2001 John Staurulakis, Inc. (JSI) Transmittal No. 64 National Exchange Carrier Association (NECA) Transmittal No. 919 - Amended Issued: December 26, 2001 Bay Springs Telephone Company Transmittal No. 82 - 2nd Amended Bay Springs Telephone Company Transmittal No. 83 Bay Springs Telephone Company Transmittal No. 83 - Amended Fidelity Telephone Company Transmittal No. 12 - Amended ICORE Transmittal No. 35 - Amended Issued: December 27, 2001 Harrisonville Telephone Company Transmittal No. 23 - Amended 16 Only the investigation into NECA’s Traffic Sensitive and Special Access rates is being terminated at this time. 7 Federal Communications Commission DA 02- 234 8 Issued: December 28, 2001 Alltel Telephone System Transmittal No. 96 8