CSHB 106(JUD) am: "An Act relating to retail tariffing standards in a competitive local exchange service area; and to exemptions from retail tariff filing requirements and certain other provisions in competitive telecommunications markets; setting a policy regarding unbundled network elements in the telecommunications market; relating to depreciation expense rates for certain telecommunications utilities; requiring the Regulatory Commission of Alaska to conduct an investigation, take certain actions, withhold certain actions, and issue a report; and providing for an effective date."
00 CS FOR HOUSE BILL NO. 106(JUD) am 01 "An Act relating to retail tariffing standards in a competitive local exchange service 02 area; and to exemptions from retail tariff filing requirements and certain other 03 provisions in competitive telecommunications markets; setting a policy regarding 04 unbundled network elements in the telecommunications market; relating to depreciation 05 expense rates for certain telecommunications utilities; requiring the Regulatory 06 Commission of Alaska to conduct an investigation, take certain actions, withhold certain 07 actions, and issue a report; and providing for an effective date." 08 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA: 09 * Section 1. AS 42.05.145 is amended by adding a new subsection to read: 10 (b) Upon the commission's approval of a carrier's application for a certificate 11 to provide competitive local exchange telecommunications service in an incumbent 12 local exchange carrier's service area, the incumbent local exchange carrier is subject to 13 the same retail tariffing standards and regulations as the new carrier in areas where the
01 commission has determined there is competition among carriers. Barring infeasibility, 02 the commission shall provide for expedited consideration as to competition among 03 carriers. However, the incumbent local exchange carrier remains the carrier of last 04 resort in the relevant area until the commission orders otherwise. 05 * Sec. 2. AS 42.05 is amended by adding new sections to read: 06 Sec. 42.05.433. Exemption from retail tariffs for telecommunications 07 services in a competitive market. (a) A local exchange carrier may petition the 08 commission for a determination that one or more of its markets is a competitive 09 services area. The commission shall, within 90 days, grant or reject the petition 10 according to the standard set forth in this section. If the commission fails to act within 11 90 days after the submission of such a petition, the petition shall be deemed granted. 12 A certification exempts the telecommunications utility from retail tariff filing 13 requirements. 14 (b) A certification filed under (a) of this section is effective upon filing. The 15 commission may deny a certification only upon a written finding and order that, based 16 on a preponderance of the evidence, the competitive service area standard has not been 17 met. 18 (c) A local exchange carrier granted a retail tariff exemption under (a) of this 19 section is, with regard to retail service in competitive service areas, exempt from the 20 following provisions of this chapter: AS 42.05.361, 42.05.371, 42.05.381, 42.05.391, 21 42.05.411, 42.05.421, and 42.05.431. 22 (d) In this section, 23 (1) "competitive service area" means an area served by a local 24 exchange carrier in which at least 50 percent of all retail customers have a choice of 25 facilities-based service providers; the area may be 26 (A) the entire service area; or 27 (B) if the entire service area is not competitive, specifically 28 identified communities within the service area that are competitive; 29 (2) "facilities-based service provider" means a telephone utility that 30 offers a portion of its products and services by means of facilities it owns and operates 31 or by means of facilities and unbundled network elements it leases from another
01 provider, or any combination of facilities owned and leased; 02 (3) "network element" means a facility or equipment used in the 03 provision of a telecommunications service; 04 (4) "retail" means services or products sold directly to the actual user 05 of the services or products; 06 (5) "unbundled" has the meaning given in 47 U.S.C. 251(c)(3). 07 Sec. 42.05.435. State telecommunications policy: pricing of unbundled 08 network elements. (a) A telephone utility providing unbundled network elements to 09 other telephone utilities under state or federal law shall be allowed to recover the 10 forward looking incremental costs it expects to incur to provide the unbundled 11 network element and shall be allowed a reasonable profit or such other measure of 12 costs as federal law may specify. To the maximum extent allowable under federal 13 law, the best evidence of the forward looking incremental costs a telephone utility 14 expects to incur shall be based on the following: 15 (1) the utility's most current reasonable costs for individual cost 16 components, such as labor, including any labor agreements, and materials in the 17 relevant service area, adjusted for inflation; 18 (2) fill factors that represent a reasonable projection of actual total 19 usage of the elements in question; 20 (3) the most efficient technology the telephone utility has actually 21 deployed; there is a rebuttable presumption that this is the most efficient technology 22 commercially reasonably available; and 23 (4) the cost of capital that reflects the risks associated with a 24 competitive market. 25 (b) In this section, "network element" and "unbundled" have the meanings 26 given in AS 42.05.433. 27 * Sec. 3. AS 42.05.471 is amended by adding a new subsection to read: 28 (c) A telephone utility's proposed depreciation rates for all rates established by 29 the commission in a competitive service area shall be allowed to the maximum extent 30 allowed by law if the underlying service lives are not shorter than the general 31 depreciation system service lives permitted by the United States Internal Revenue
01 Service to determine the appropriate level of depreciation expense for federal income 02 tax computations. The commission may not require a telephone utility to file a 03 depreciation study unless the telephone utility proposes to use depreciation rates based 04 on service lives that are shorter than the general depreciation system service lives 05 permitted by the Internal Revenue Service. 06 * Sec. 4. The uncodified law of the State of Alaska is amended by adding a new section to 07 read: 08 IMMEDIATE REVIEW; INTENT. (a) The Regulatory Commission of Alaska shall 09 immediately investigate the state of telecommunications competition and take such action as 10 is necessary to ensure that all participants in a market bear the same regulatory burdens. 11 (b) The Regulatory Commission of Alaska shall, within 180 days after the effective 12 date of this Act, provide a written report to the legislature that must include 13 (1) a description of the status of the telecommunications industry in Alaska; 14 (2) rules or regulations proposed or adopted to implement this Act; and 15 (3) recommendations to the legislature for further legislative action, if any. 16 (c) It is the intent of the legislature that state telecommunications policy promote 17 multiple goals. Consumers should be protected and rates should be minimized. Regulators 18 should create conditions conducive to financially healthy and viable telecommunications 19 providers. Rules, regulations, and adjudications should ensure sufficient incentives for new 20 investment in telecommunications networks. State policy should be neutral as between 21 competitors. The provisions of this Act are intended to provide guidance on some but not all 22 state policies that require revision. 23 * Sec. 5. This Act takes effect immediately under AS 01.10.070(c).