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SB 187: "An Act relating to regulation of telecommunications utilities."

00 SENATE BILL NO. 187                                                                                                     
01 "An Act relating to regulation of telecommunications utilities."                                                        
02 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA:                                                                
03    * Section 1.  SHORT TITLE.  This Act may be known as the "Telecommunications                                         
04 Regulatory Reform Act of 1995."                                                                                         
05    * Sec. 2.  FINDINGS.  The legislature finds that                                                                     
06   (1)  modern, affordable, efficient, and universally available telecommunications                                      
07 service is essential to the people of the state;                                                                        
08   (2)  more efficient delivery of educational, health care, public safety, and other                                    
09 public services will be enhanced by allowing telecommunications utilities regulatory flexibility                        
10 in service offerings;                                                                                                   
11   (3)  technological innovation, new services, reduced costs, and increased                                             
12 consumer choice for telecommunications service, resulting from the lifting of outdated                                  
13 regulations to allow telecommunications utilities to engage in fair competition, will enhance                           
14 the state's economic growth, create jobs, and increase productivity;                                                    
01   (4)  the Alaska Public Utilities Commission should oversee competition to                                             
02 ensure that the competition is fair and that the benefits of competition are realized.                                  
03    * Sec. 3.  AS 42.05.123(c) is amended to read:                                                                       
04  (c)  It is the responsibility of the communications carrier section in its                                            
05 participation in rate or tariff adjudication proceedings to advocate and provide support                                
06 for just and reasonable rates [THE LOWEST PRACTICABLE RATE] under the                                                 
07 circumstances.                                                                                                          
08    * Sec. 4.  AS 42.05.191 is amended to read:                                                                          
09  Sec. 42.05.191.  FORMAT OF ORDERS.  Every formal order of the                                                         
10 commission shall be based upon the facts of record.  Every order entered pursuant to                                    
11 a hearing must state the commission's findings, the basis of its findings and                                           
12 conclusions, and [TOGETHER WITH] its decision.  In the case of a formal order                                        
13 concerning a telecommunications utility, the commission's order must also include                                       
14 conclusions of law.  These orders shall be entered of record and a copy of them shall                                  
15 be served on all parties of record in the proceeding.                                                                   
16    * Sec. 5.  AS 42.05.201 is amended to read:                                                                          
17  Sec. 42.05.201.  PUBLICATION OF REPORTS, ORDERS, DECISIONS, AND                                                     
18 REGULATIONS.  All reports, orders, decisions, and regulations of the commission                                       
19 shall be in writing.  The commission shall apprise all affected utilities and interested                                
20 parties of these reports, orders, decisions, and regulations as they are issued and                                     
21 adopted, and, when appropriate to do so, shall publish them in a manner that will                                       
22 reasonably inform the public or the affected consumers of any public utility service.                                  
23 In publishing orders concerning telecommunications utility cost and marketing                                           
24 information, the commission shall comply with AS 42.05.671(c).  The commission                                         
25 may set charges for costs of printing or reproducing and furnishing copies of its                                       
26 reports, orders, decisions, and regulations.  The publication requirement, as it pertains                             
27 to regulations, does not supersede the requirements of AS 44.62 ( [THE]                                               
28 Administrative Procedure Act [(AS 44.62]).                                                                              
29    * Sec. 6.  AS 42.05.301 is amended by adding a new subsection to read:                                               
30  (b)  It is not an unreasonable preference under this section for a                                                    
31 telecommunications utility to offer a new service on a trial basis to selected customers.                               
01    * Sec. 7.  AS 42.05.306 is amended by adding a new subsection to read:                                               
02  (b)  A telecommunications utility may offer a discounted service or reduced                                           
03 rate for telecommunications services provided to schools, universities, libraries, health                               
04 care facilities, museums, public broadcast stations, public safety facilities, and other                                
05 public institutional communications users.  The commission may not require a                                            
06 telecommunications utility to offer a discounted service or reduced rate or to incur                                    
07 uncompensated costs or administrative burdens for services provided under this section.                                 
08    * Sec. 8.  AS 42.05.311(a) is amended to read:                                                                       
09  (a)  A public utility having sewers, conduits, utilidors, poles, pole lines, pipes,                                   
10 pipelines, mains, or other distribution or transmission facilities shall, for a reasonable                            
11 compensation, permit another public utility to use them when the public convenience                                     
12 and necessity require this use and the use will not result in substantial injury to the                                 
13 owner, or in substantial detriment to the service to the customers of the owners.                                      
14 However, a telecommunications utility is not required to permit another utility to                                      
15 use its facilities under this subsection if the use will result in injury to the owner                                  
16 or detriment to the service to the customers of the owners.  The cost of                                               
17 modifications or additions necessary to a joint use shall be at the expense of the public                               
18 utility requesting the use of the facilities.                                                                           
19    * Sec. 9.  AS 42.05.311(b) is amended to read:                                                                       
20  (b)  A telecommunications utility shall permit connection to be made and                                              
21 service to be furnished between a system operated by it and the system or toll facilities                               
22 operated by another public utility or with the communications facility or system of a                                   
23 nonutility, or between its toll facilities and the toll facilities of another public utility,                           
24 when public convenience and necessity require the connection and the connection will                                    
25 not result in substantial injury to the owner or other users of the facilities of either                                
26 public utility or in substantial detriment to the service of either public utility.                                    
27 However, a telecommunications utility is not required to permit another utility to                                      
28 make a connection  or furnish service under this subsection if the connection or                                        
29 provision of services will result in injury to the owner or other users of the                                          
30 facilities or in detriment to the service provided.  For telecommunications utilities,                                  
31 the modifications or additions necessary to joint use shall be made at the expense                                      
01 of the entity requesting the use of the facilities.                                                                    
02    * Sec. 10.  AS 42.05.321(a) is amended to read:                                                                      
03  (a)  In case of failure to agree upon the joint use or interconnection of facilities                                  
04 or the conditions or compensation for joint use or interconnections, the public utility,                                
05 including any municipality, or an interested person may apply to the commission for                                     
06 an order requiring the interconnection.   Except as provided in (c) of this section, if                                
07 [IF] after investigation and opportunity for hearing, the commission finds that public                                 
08 convenience and necessity require the joint use or connection, and that the use or                                      
09 connection will not result in substantial injury to the owner utility or its customers, or                              
10 in substantial detriment to the services furnished by the owner utility, or in the creation                             
11 of safety hazards, it shall                                                                                             
12   (1)  order that the use be permitted;                                                                                
13   (2)  prescribe reasonable conditions and compensation for the joint use;                                             
14   (3)  order the interconnection to be made;                                                                           
15   (4)  determine the time and manner of the interconnection;                                                           
16   (5)  determine the apportionment of costs and responsibility for                                                     
17 operation and maintenance of the interconnection.                                                                       
18    * Sec. 11.  AS 42.05.321 is amended by adding a new subsection to read:                                              
19  (c)  In the case of a telecommunications utility, the commission may require                                          
20 the utility to permit the joint use or connection that is in the public interest under (a)                              
21 of this section only if the commission finds that the use or connection will not result                                 
22 in injury to the owner utility or its customers, or in detriment to the services furnished                              
23 by the owner utility, or in the creation of safety hazards.                                                             
24    * Sec. 12.  AS 42.05.361(a) is amended to read:                                                                      
25  (a)  Under regulations the commission shall adopt, every public utility shall file                                    
26 with the commission, within the time and in the form the commission designates, its                                     
27 complete tariff showing all rates, including joint rates, tolls, rentals, and charges                                   
28 collected and all classifications, rules, regulations, and terms and conditions under                                   
29 which it furnishes its services and facilities to the general public, or to a regulated or                              
30 municipally owned utility for resale to the public, together with a copy of every special                               
31 contract with customers that [WHICH] in any way affects or relates to the serving                                     
01 utility's rates, tolls, charges, rentals, classifications, services, or facilities.  However,                        
02 a telecommunications utility is not required to file a copy of a special contract                                       
03 concerning a telecommunications service subject to competition unless specifically                                      
04 requested to do so by the commission.  The public utility shall clearly print, or type,                                
05 its complete tariff and keep an up-to-date copy of it on file at its principal business                                 
06 office and at a designated place in each community served.  The tariffs shall be made                                   
07 available to, and subject to inspection by, the general public on demand.                                               
08    * Sec. 13.  AS 42.05.391 is amended by adding a new subsection to read:                                              
09  (e)  It is not an unreasonable preference or advantage for a telecommunications                                       
10 utility to                                                                                                              
11   (1)  offer a service subject to competition at or above the incremental                                              
12 cost of providing the service;                                                                                          
13   (2)  offer a new service at or above the incremental cost of providing                                               
14 the service;                                                                                                            
15   (3)  waive the nonrecurring charges for a nonessential or competitive                                                
16 service as part of a promotional offering;                                                                              
17   (4)  offer a new service on a trial basis to selected customers.                                                     
18    * Sec. 14.  AS 42.05.411(a) is amended to read:                                                                      
19  (a)  Except as provided in AS 42.05.416, a [A] public utility may not establish                                     
20 or place in effect any new or revised rates, charges, rules, regulations, conditions of                                 
21 service, or practices except after 45 days' notice to the commission and 30 days' notice                              
22 to the public.  Notice shall be given to the commission by filing with the commission                                   
23 and keeping open for public inspection the revised tariff provisions that [WHICH]                                     
24 shall plainly indicate the changes to be made in the schedules then in force and the                                    
25 time when the changes will go into effect.  The commission shall prescribe means by                                     
26 regulation whereby notice is given to the public before or no later than 15 days after                                  
27 the filing that is reasonably adequate to notify customers affected by the filing.  The                                 
28 commission, for good cause shown, may allow changes to take effect on less than 45                                      
29 days' notice to the commission or 30 days' notice to the public under conditions the                                    
30 commission prescribes.                                                                                                  
31    * Sec. 15.  AS 42.05 is amended by adding a new section to read:                                                     
01  Sec. 42.05.416.  TELECOMMUNICATIONS SERVICES SUBJECT TO                                                               
02 COMPETITION.  (a)  A telecommunications utility whose services are subject to                                           
03 competition may not establish or put into effect an initial rate, charge, rule, regulation,                             
04 condition of service, or practice until the utility has given 30 days' notice to the                                    
05 commission and 15 days' notice to the public.  The commission may, for good cause                                       
06 shown, allow charges to take effect after fewer than 30 days' notice to the commission                                  
07 or 15 days' notice to the public.                                                                                       
08  (b)  The rates charged for a tariffed telecommunications service that is subject                                      
09 to competition may be changed if the utility gives at least 10 days' notice to the                                      
10 commission.                                                                                                             
11  (c)  A telecommunications utility shall, within 10 days after the effective date                                      
12 of a special contract concerning telecommunications services subject to competition,                                    
13 file a notice with the commission describing the special contract.                                                      
14  (d)  A new special contract concerning telecommunications services subject to                                         
15 competition may not take effect until after the commission determines that the                                          
16 telecommunications services that are the subject of the contract are subject to                                         
17 competition.                                                                                                            
18    * Sec. 16.  AS 42.05.421(a) is amended to read:                                                                      
19  (a)  Except as provided in AS 42.05.426, when [WHEN] a tariff filing is                                             
20 made containing a new or revised rate, classification, rule, regulation, practice, or                                   
21 condition of service the commission may, either upon written complaint or upon its                                      
22 own motion, after reasonable notice, conduct a hearing to determine the reasonableness                                  
23 and propriety of the filing.  Pending the hearing, the commission may, by order stating                               
24 the reasons for its action, suspend the operation of the tariff filing. For a tariff filing                             
25 that does not change the utility's revenue requirement or rate design, the suspension                                   
26 may last for a period not longer than six months beyond the effective date established                                  
27 in the tariff filing unless the commission extends the period for good cause.  In the                                  
28 case of a tariff filing of a telecommunications utility, whether or not the filing                                      
29 changes  the utility's revenue requirement or rate design, the commission may not                                       
30 extend the period of suspension.  For a tariff filing that changes the utility's revenue                               
31 requirement or rate design, the suspension may last, unless the commission extends the                                  
01 period for good cause, for a period not longer than                                                                     
02   (1)  six months before an interim rate equal to the requested rate goes                                              
03 into effect and not longer than 12 months before a permanent rate goes into effect if                                   
04 the annual gross revenues of the utility making the filing are more than $3,000,000;                                    
05 and                                                                                                                     
06   (2)  150 days before an interim rate equal to the requested new rate goes                                            
07 into effect and not longer than one year before a permanent rate goes into effect if the                                
08 annual gross revenues of the utility making the filing are $3,000,000 or less.                                          
09    * Sec. 17.  AS 42.05 is amended by adding new sections to read:                                                      
10  Sec. 42.05.426.  NEW OR COMPETITIVE TELECOMMUNICATIONS                                                                
11 SERVICES.  (a)  A telecommunications utility may ask the commission to determine                                        
12 that a telecommunications service is a service subject to competition.  The commission                                  
13 shall make a determination and accept or reject a request that a service be treated as                                  
14 subject to competition within 30 days after receipt of a filing making the request.  If                                 
15 the commission does not act within the 30 days, the request is considered to be                                         
16 granted.                                                                                                                
17  (b)  Commission order changes to new telecommunications services or to                                                
18 telecommunications services that are subject to competition may only take effect                                        
19 prospectively.                                                                                                          
20  (c)  The commission shall make findings concerning whether a new service                                              
21 offering or a service offering subject to competition is just and reasonable within six                                 
22 months after receipt of the request.  If the commission does not act within the six                                     
23 months, the terms and conditions are considered to be just and reasonable.                                              
24  (d)  A telecommunications utility may file a request to offer a service that is                                       
25 subject to competition as a deregulated service that is no longer subject to the                                        
26 commission's jurisdiction.  The commission shall adopt regulations governing the filing                                 
27 requirements for a reclassification of a service from regulated to deregulated to ensure                                
28 that the costs and revenue are accounted for appropriately.  The commission shall                                       
29 review reclassification filings within 60 days after receipt of the filing and issue                                    
30 findings that either accept or reject the filing.  If the commission fails to act within the                            
31 60 days, the filing takes effect.  A determination that a utility may offer a deregulated                               
01 service does not affect the utility's status as a regulated utility or an exempt utility                                
02 under AS 42.05.254.                                                                                                     
03    * Sec. 18.  AS 42.05 is amended by adding a new section to read:                                                     
04  Sec. 42.05.436.  NEW OR COMPETITION TELECOMMUNICATIONS                                                                
05 SERVICES.  (a)  For a new service or a competitive service subject to competition,                                      
06 a just and reasonable rate is a rate at or above the incremental cost of providing the                                  
07 service.  If the commission, after investigation and hearing, finds that a rate is below                                
08 the incremental cost of providing the service, it shall                                                                 
09   (1)  determine the incremental cost of providing the service and                                                     
10 establish it by order; and                                                                                              
11   (2)  require the utility to show cause why it should not be subject to                                               
12 AS 42.05.571 and 42.05.581 for each day that a customer received a service at a rate                                    
13 below the incremental cost.                                                                                             
14  (b)  If the commission fails to make its rate findings within six months after                                        
15 the filing date, the rate is considered to be just and reasonable.                                                      
16    * Sec. 19.  AS 42.05.441 is amended by adding a new subsection to read:                                              
17  (d)  The commission shall presume, subject to rebuttal, that, if property has                                         
18 been included in rates for a telecommunications utility, it continues to be allowable for                               
19 rate making purposes.                                                                                                   
20    * Sec. 20.  AS 42.05.471 is amended by adding a new subsection to read:                                              
21  (c)  The commission shall presume, subject to rebuttal, that the depreciation                                         
22 rates and methodologies accepted by the Federal Communications Commission                                               
23 establish a reasonable range of depreciation rates and methodologies for                                                
24 telecommunications utilities.                                                                                           
25    * Sec. 21.  AS 42.05.671 is amended by adding a new subsection to read:                                              
26  (e)  Cost and marketing information associated with new telecommunications                                            
27 services or telecommunications services subject to competition is confidential and not                                  
28 open to the public for inspection.  The commission shall remove confidential                                            
29 information from its publicly issued orders.  The commission shall adopt regulations                                    
30 to implement this subsection.                                                                                           
31    * Sec. 22.  AS 42.05.990 is amended by adding a new paragraph to read:                                               
01   (9)  "service subject to competition" means a service where a customer                                               
02 may purchase a substitute service from another entity.