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H0224......................................................by STATE AFFAIRS
TELECOMMUNICATIONS - Amends and adds to existing law to authorize a
telephone corporation to elect to have all or part of its
telecommunications services excluded from regulation pursuant to Title 61,
Idaho Code, and to be subject to regulation pursuant to Chapter 6, Title
62, Idaho Code; to authorize the Public Utilities Commission to regulate
telephone corporations for the purpose of implementing the Federal
Communications Act of 1996; to provide the Public Utilities Commission with
authority to determine noneconomic regulatory requirements for telephone
corporations providing basic local exchange service; to prohibit certain
rate increases for basic local exchange service during the period of three
years following the effective date of the election; to authorize the Public
Utilities Commission to extend the transition period for an additional two
years; to establish the rates for basic local exchange service to be used
to determine eligibility of certain telephone companies to draw funds from
the state universal service fund; to prohibit a telephone corporation from
requiring a basic local exchange service customer to purchase or subscribe
to telecommunication services other than basic local exchange services; to
prohibit any increase in the stand-alone basic local exchange service rate
to an amount that is higher than the rate for such service for basic local
exchange customers in the local exchange calling area having the highest
number of basic local exchange customers served by the telephone
corporation; to define "stand-alone basic local exchange rate"; to provide
certain duties relating to unauthorized charges by third-party service
providers; to provide an exception to the exemption from the antitrust
liability of a telephone corporation; and to provide the Public Utility
Commission authority to establish a minimum price for basic local exchange
service upon complaint by another telephone corporation relating to below
variable cost pricing for such services by certain telephone corporations.
02/16 House intro - 1st rdg - to printing
02/17 Rpt prt - to St Aff
02/24 Rpt out - rec d/p - to 2nd rdg
02/25 2nd rdg - to 3rd rdg
03/04 3rd rdg - PASSED - 48-22-0
AYES -- Anderson, Andrus, Barraclough, Bastian, Bayer, Bedke, Bell,
Bilbao, Black, Block, Bolz, Cannon, Chadderdon, Clark, Collins, Crow,
Deal, Edmunson, Eskridge, Field(18), Field(23), Garrett, Hart,
Henderson, Jones, Kemp, Lake, Mathews, McKague, Miller, Nielsen,
Nonini, Raybould, Ring, Roberts, Rydalch, Sali, Schaefer,
Shepherd(2), Shepherd(8), Shirley, Skippen, Smith(30), Smylie,
Snodgrass, Stevenson, Wills, Mr. Speaker
NAYS -- Barrett, Boe, Bradford, Denney, Ellsworth, Harwood, Henbest,
Jaquet, LeFavour, Loertscher, Martinez, McGeachin, Mitchell, Moyle,
Pasley-Stuart, Pence, Ringo, Rusche, Sayler, Smith(24), Trail, Wood
Absent and excused -- None
Floor Sponsor - Deal
Title apvd - to Senate
03/07 Senate intro - 1st rdg - to St Aff
03/17 Rpt out - rec d/p - to 2nd rdg
03/18 2nd rdg - to 3rd rdg
03/21 3rd rdg - PASSED - 18-17-0, 1 vacancy
Tie vote - President voted AYE
AYES -- Andreason, Brandt, Bunderson, Cameron, Compton, Darrington,
Davis, Goedde, Hill, Jorgenson, Keough, Little, Lodge, McGee,
McKenzie, Stegner, Sweet
NAYS -- Broadsword, Burkett, Burtenshaw, Coiner, Corder, Gannon,
Geddes, Kelly, Langhorst, Malepeai, Marley, Pearce, Richardson,
Schroeder, Stennett, Werk, Williams
Absent and excused -- (District 21 seat vacant)
Floor Sponsor - McKenzie
Title apvd - to House
03/22 To enrol
03/23 Rpt enrol - Sp signed
03/24 Pres signed - To Governor
03/29 Governor signed
Session Law Chapter 200
Effective: 07/01/05
]]]] LEGISLATURE OF THE STATE OF IDAHO ]]]]
Fifty-eighth Legislature First Regular Session - 2005
IN THE HOUSE OF REPRESENTATIVES
HOUSE BILL NO. 224
BY STATE AFFAIRS COMMITTEE
1 AN ACT
2 RELATING TO TELECOMMUNICATION REGULATION; AMENDING SECTION 62-604, IDAHO CODE,
3 TO AUTHORIZE A TELEPHONE CORPORATION TO ELECT TO HAVE ALL OR PART OF ITS
4 TELECOMMUNICATION SERVICES EXCLUDED FROM REGULATION PURSUANT TO TITLE 61,
5 IDAHO CODE, AND TO BE THEREAFTER SUBJECT TO REGULATION PURSUANT TO CHAPTER
6 6, TITLE 62, IDAHO CODE, AND TO MAKE TECHNICAL CORRECTIONS; AMENDING SEC-
7 TION 62-605, IDAHO CODE, TO REVISE THE PROCEDURE FOR THE NOTICE OF ELEC-
8 TION, TO AUTHORIZE THE PUBLIC UTILITIES COMMISSION TO REGULATE TELEPHONE
9 CORPORATIONS FOR THE PURPOSE OF IMPLEMENTING THE FEDERAL COMMUNICATIONS
10 ACT OF 1996, TO PROVIDE THE PUBLIC UTILITIES COMMISSION WITH CONTINUING
11 AUTHORITY TO DETERMINE NONECONOMIC REGULATORY REQUIREMENTS FOR TELEPHONE
12 CORPORATIONS PROVIDING BASIC LOCAL EXCHANGE SERVICE, PROHIBITING CERTAIN
13 RATE INCREASES FOR BASIC LOCAL EXCHANGE SERVICE DURING THE PERIOD OF THREE
14 YEARS FOLLOWING THE EFFECTIVE DATE OF THE ELECTION, TO AUTHORIZE THE PUB-
15 LIC UTILITIES COMMISSION TO EXTEND THE TRANSITION PERIOD FOR TWO ADDI-
16 TIONAL YEARS AND TO ESTABLISH THE RATES FOR BASIC LOCAL EXCHANGE SERVICE
17 TO BE USED TO DETERMINE ELIGIBILITY OF CERTAIN TELEPHONE CORPORATIONS TO
18 DRAW FUNDS FROM THE STATE UNIVERSAL SERVICE FUND; AMENDING CHAPTER 6,
19 TITLE 62, IDAHO CODE, BY THE ADDITION OF A NEW SECTION 62-607A, IDAHO
20 CODE, TO PROHIBIT A TELEPHONE CORPORATION FROM REQUIRING A BASIC LOCAL
21 EXCHANGE SERVICE CUSTOMER, AS A CONDITION OF RECEIVING BASIC LOCAL
22 EXCHANGE SERVICE, TO PURCHASE OR SUBSCRIBE TO TELECOMMUNICATION SERVICES
23 OTHER THAN BASIC LOCAL EXCHANGE SERVICES, TO PROHIBIT ANY INCREASE IN THE
24 STAND-ALONE BASIC LOCAL EXCHANGE SERVICE RATE TO AN AMOUNT THAT IS HIGHER
25 THAN THE RATE FOR SUCH SERVICE FOR BASIC LOCAL EXCHANGE CUSTOMERS IN THE
26 LOCAL EXCHANGE CALLING AREA HAVING THE HIGHEST NUMBER OF BASIC LOCAL
27 EXCHANGE CUSTOMERS SERVED BY THE TELEPHONE CORPORATION AND TO DEFINE
28 "STAND-ALONE BASIC LOCAL EXCHANGE RATE"; AMENDING CHAPTER 6, TITLE 62,
29 IDAHO CODE, BY THE ADDITION OF A NEW SECTION 62-616A, IDAHO CODE, TO PRO-
30 VIDE FOR THE DUTY OF A TELEPHONE CORPORATION TO CUSTOMERS RELATING TO
31 UNAUTHORIZED CHARGES BY A THIRD-PARTY SERVICE PROVIDER; AMENDING SECTION
32 62-617, IDAHO CODE, TO PROVIDE AN EXCEPTION TO THE EXEMPTION FROM THE
33 ANTITRUST LIABILITY OF A TELEPHONE CORPORATION; AND AMENDING CHAPTER 6,
34 TITLE 62, IDAHO CODE, BY THE ADDITION OF A NEW SECTION 62-622A, IDAHO
35 CODE, TO PROVIDE PUBLIC UTILITY COMMISSION AUTHORITY TO ESTABLISH A MINI-
36 MUM PRICE FOR BASIC LOCAL EXCHANGE SERVICE UPON COMPLAINT BY ANOTHER TELE-
37 PHONE CORPORATION RELATING TO BELOW VARIABLE COST PRICING FOR SUCH SER-
38 VICES BY TELEPHONE CORPORATIONS NOT SUBJECT TO TITLE 61, IDAHO CODE.
39 Be It Enacted by the Legislature of the State of Idaho:
40 SECTION 1. That Section 62-604, Idaho Code, be, and the same is hereby
41 amended to read as follows:
42 62-604. APPLICABILITY OF CHAPTER.
43 (1) (a) Any telephone corporation, except any mutual nonprofit or cooper-
2
1 ative telephone corporation, which did not, on January 1, 1988, hold a
2 certificate of public convenience and necessity issued by the commission
3 and, which does not provide basic local exchange service, shall, on and
4 after the effective date of this act, be subject to the provisions of this
5 chapter and shall be exempt from the provisions of title 61, Idaho Code.
6 (b) All telephone corporations, as set forth in subparagraph subsection
7 (1)(a) of this section, shall file a notice with the commission, which
8 notice shall set forth the following information:
9 (i) the name of the telephone corporation and the address of its
10 principal place of business within the state;
11 (ii) a description of the telecommunication services offered by such
12 telephone corporation and the area served by it or in which it offers
13 telecommunication services,.
14 (c) Such notice shall be filed on or before the 1st day of January of
15 each year following the effective date of this act.
16 (2) Any telephone corporation holding a certificate of public convenience
17 and necessity on January 1, 1988, issued by the commission pursuant to title
18 61, Idaho Code, may, pursuant to section 62-605, Idaho Code:
19 (a) elect to exclude all, or part of its telecommunication services,
20 other than basic local exchange service including recurring and nonrecur-
21 ring charges therefor, from regulation pursuant to title 61, Idaho Code,
22 and such excluded telecommunication services shall thereafter be subject
23 to the provisions of this chapter, except for the provisions of section
24 62-622(1) through (3), Idaho Code;
25 (b) notwithstanding any other provision of this chapter, a telephone cor-
26 poration which, pursuant to section 61-538, Idaho Code, was, prior to the
27 effective date of this chapter, subject to the provisions of such section,
28 shall continue to be subject to the provisions of section 61-538, Idaho
29 Code, notwithstanding such telephone corporation is subject to the provi-
30 sions of this chapter.
31 SECTION 2. That Section 62-605, Idaho Code, be, and the same is hereby
32 amended to read as follows:
33 62-605. PROCEDURE FOR NOTICE OF ELECTION -- COMMISSION CONTINUING AUTHOR-
34 ITY. (1) A telephone corporation which held a certificate of public conve-
35 nience and necessity on January 1, 1988, may file with the commission a notice
36 that such telephone corporation elects to be subject to the provisions of this
37 chapter for all, or part of its telecommunication services, other than basic
38 local exchange service, which notice shall include the following:
39 (a) The name and address of the telephone corporation;
40 (b) A narrative description of the telecommunication services provided by
41 the telephone corporation and the geographic area and market served by the
42 telephone corporation and a description of the telecommunication services
43 for which the election is made.
44 (2) Upon the expiration of thirty (30) days from the filing of such
45 notice of election, said telephone corporation shall, as to telecommunication
46 services other than basic local exchange service set forth in the notice of
47 election, be exempt from the provisions of title 61, Idaho Code, and such
48 telecommunication services shall thereafter be subject to the provisions of
49 this chapter with the exception of the provisions of section 62-622(1) through
50 (3), Idaho Code.
51 (3) Nothing contained in the provisions of this chapter or title 61,
52 Idaho Code, shall be construed to prevent any person or entity from providing
53 telecommunication services in competition with a telephone corporation as to
3
1 those services which have been excluded from regulation under title 61, Idaho
2 Code, pursuant to the provisions of this chapter, or with a telephone corpora-
3 tion, other than a mutual, nonprofit or cooperative telephone corporation,
4 which was not, on the effective date of this act, subject to regulation by the
5 commission pursuant to title 61, Idaho Code.
6 (4) Nothing contained in the provisions of this chapter shall be con-
7 strued to prevent any telephone corporation from maintaining on file with the
8 commission a tariff or price list describing the details of its services.
9 (5) (a) For any telecommunication service which was subject, on the
10 effective date of this act July 1, 1988, to title 61, Idaho Code, and
11 which at the election of the telephone corporation became subject to this
12 chapter, the commission shall have continuing authority to review the
13 quality of such service, its general availability, and terms and condi-
14 tions under which it is offered. Upon complaint to the commission and
15 after notice to the telephone corporation providing such service and hear-
16 ing, the commission finds that the quality, general availability or terms
17 and conditions for such service are adverse to the public interest, the
18 commission shall have authority to negotiate or require changes in how
19 such telecommunication services are provided regulate the telephone corpo-
20 ration to the extent necessary to implement the federal communications act
21 of 1996, in accordance with section 62-615, Idaho Code.
22 (b) The commission shall have the continuing authority to determine the
23 noneconomic regulatory requirements relating to basic local exchange ser-
24 vice for all telephone corporations providing basic local exchange service
25 including, but not limited to, such matters as service quality standards,
26 provision of access to carriers providing message telecommunication ser-
27 vice, filing of price lists, customer notice and customer relation rules,
28 and billing practices and procedures, which requirements shall be
29 technologically and competitively neutral.
30 (c) In addition, if the commission finds that such corrective action is
31 inadequate, it shall have the authority to require that such telecommuni-
32 cation services be subject to the requirements of title 61, Idaho Code,
33 rather than the provisions of this chapter a telephone corporation has
34 made an election pursuant to section 62-604, Idaho Code, and this section
35 with reference to basic local exchange service, the maximum price the
36 telephone corporation may charge for stand-alone basic local exchange ser-
37 vice, as defined in section 62-607A, Idaho Code, during the transition
38 period, shall, in the first year of the transition period, be capped at a
39 rate ten percent (10%) above the rate in effect at the time of the elec-
40 tion. Thereafter, in each succeeding year of the transition period, the
41 price cap shall be increased by an additional amount that is equal to the
42 difference between the rate at the time of the election and the price cap
43 established hereunder for the first year of the transition period. How-
44 ever, during the transition period, the price cap established herein shall
45 in no event exceed the maximum basic local exchange rate that was in
46 effect and authorized or approved by the commission for any telephone cor-
47 poration regulated pursuant to title 61, Idaho Code, or section 62-622(1),
48 Idaho Code, for residence and business basic local exchange service rates,
49 respectively, on the date the telephone corporation made the election pur-
50 suant to section 62-604, Idaho Code, and this section with reference to
51 basic local exchange service.
52 (d) The term "transition period," as used in this section, means a period
53 of three (3) years from the effective date of the election by a telephone
54 corporation to exclude basic local exchange services from regulation pur-
55 suant to title 61, Idaho Code, or section 62-622(1), Idaho Code. Provided
4
1 however, the commission may, during the one hundred eighty (180) day
2 period prior to the expiration of the initial three (3) year transition
3 period, by order, extend the transition period for a period of two (2)
4 additional years if the commission finds that such action is necessary to
5 protect the public interest. The commission shall, if the transition
6 period is extended, as herein provided, file a copy of the commission's
7 order with the governor and the legislature.
8 (e) For the purpose of calculating the weighted statewide average rates
9 for residence and business basic local exchange service rates to enable
10 the commission to determine eligibility for distributions to eligible
11 telecommunications carriers from the universal service fund established
12 pursuant to chapter 6, title 62, Idaho Code, the residence and business
13 basic local exchange rates in effect on July 1, 2005, shall constitute the
14 basis for such calculation, unless the commission determines that changes
15 in basic local exchange rates subsequent to July 1, 2005, should be used
16 for such calculation for the purpose of determining the eligibility of
17 telecommunications carriers for distributions from the universal service
18 fund.
19 SECTION 3. That Chapter 6, Title 62, Idaho Code, be, and the same is
20 hereby amended by the addition thereto of a NEW SECTION, to be known and des-
21 ignated as Section 62-607A, Idaho Code, and to read as follows:
22 62-607A. PROHIBITED ACTIVITIES BY A TELEPHONE CORPORATION. (1) No incum-
23 bent telephone corporation, or eligible telecommunications carrier as defined
24 in section 62-610B(1), Idaho Code, shall require a residential or small busi-
25 ness customer, as a condition of receiving basic local exchange service, to
26 purchase or subscribe to telecommunication services other than one (1) access
27 line for the provision of basic local exchange service.
28 (2) A telephone corporation that has made the election provided in sec-
29 tions 62-604 and 62-605, Idaho Code, with reference to basic local exchange
30 service, shall not increase its stand-alone basic local exchange rate to resi-
31 dential or small business customers in any local exchange calling area to an
32 amount that is higher than that telephone corporation's stand-alone basic
33 local exchange rate for residential or small business customers in the local
34 exchange calling area having the highest number of basic local exchange ser-
35 vice residential or business customers served by the telephone corporation
36 within the state.
37 (3) "Stand-alone basic local exchange rate," as used herein, means the
38 monthly charge made by a telephone corporation to a residential or small busi-
39 ness basic local exchange service customer for a single line that is not
40 included in a package of services or price discounted in a promotional offer-
41 ing. "Stand-alone basic local exchange rate" does not include any charges
42 resulting from action by a federal agency or taxes or surcharge imposed by a
43 governmental body that are separately itemized and billed by a telephone cor-
44 poration to its customers.
45 SECTION 4. That Chapter 6, Title 62, Idaho Code, be, and the same is
46 hereby amended by the addition thereto of a NEW SECTION, to be known and des-
47 ignated as Section 62-616A, Idaho Code, and to read as follows:
48 62-616A. DUTY OF TELEPHONE COMPANY TO CUSTOMERS RELATING TO UNAUTHORIZED
49 CHARGES BY A THIRD-PARTY SERVICE PROVIDER. If a customer of a telephone corpo-
50 ration, whether subject to the provisions of this chapter or title 61, Idaho
51 Code, notifies the telephone corporation that an unauthorized charge from a
5
1 third-party service provider has been included on the telephone customer's
2 bill by the telephone corporation, the telephone corporation shall remove the
3 disputed charge from the bill and shall credit to the customer any amounts for
4 unauthorized charges, whether paid or unpaid, that were billed by the tele-
5 phone corporation on behalf of the third-party service provider during the
6 period of six (6) months prior to the customer's notification to the telephone
7 corporation that unauthorized charges from a third-party service provider have
8 been included on the telephone corporation customer's bill. Nothing contained
9 herein shall restrict the right of the telephone corporation to recover cred-
10 ited charges from the third-party service provider.
11 SECTION 5. That Section 62-617, Idaho Code, be, and the same is hereby
12 amended to read as follows:
13 62-617. TELEPHONE CORPORATION ANTITRUST LIABILITY. No action under the
14 antitrust laws or any other provision or doctrine of law of the state of Idaho
15 shall lie against a telephone corporation for providing service in compliance
16 with any order of the commission. Provided however, this section shall not
17 apply to the provision of any service for which the commission has approved or
18 acknowledged an election pursuant to section 62-605(1), Idaho Code, except to
19 the extent such service thereafter is the subject of a specific commission
20 order pursuant to title 62, Idaho Code.
21 SECTION 6. That Chapter 6, Title 62, Idaho Code, be, and the same is
22 hereby amended by the addition thereto of a NEW SECTION, to be known and des-
23 ignated as Section 62-622A, Idaho Code, and to read as follows:
24 62-622A. COMMISSION AUTHORITY TO ESTABLISH MINIMUM PRICING OF BASIC LOCAL
25 EXCHANGE SERVICE. A telephone corporation may file a petition with the commis-
26 sion alleging that another telephone corporation, not subject to regulation
27 pursuant to title 61, Idaho Code, is offering basic local exchange service to
28 customers in a local exchange calling area at a price below its average vari-
29 able cost of providing such service in the local exchange calling area. The
30 commission shall, if after hearing it finds by a preponderance of the evidence
31 that the allegations contained in the petition are true, establish a minimum
32 price for basic local exchange service of the telephone corporation in the
33 local exchange calling area, which minimum price shall reflect the telephone
34 corporation's average variable cost of providing such service.
STATEMENT OF PURPOSE
RS 14965
This proposal will permit currently regulated telephone
companies, to transition into a technologically and
competitively neutral communications market environment and
away from a state-created monopoly regulatory environment,
created by the state in 1913.
Changes in federal and state law eliminated the
monopoly status of Idaho's regulated telephone companies by
opening the previously protected territories to all
competitors and mandating "network-sharing" with their
unregulated competitors. In addition, the digital revolution
has made possible the dramatic growth in wireless usage, the
steady increase in cable telephony, the rise of Voice-Over-
Internet Protocol (VOIP) services, and the explosion of
electronic messaging, none of which are regulated by the
state. A dynamic and contestable marketplace now exists in
Idaho.
This legislation will allow Idaho's regulated telephone
companies to forego the former monopoly based regulation,
and, following a transition period of up to five years, be a
full participant in the competitive communications
marketplace. The legislation also addresses the following
consumer issues:
During a transition period of up to five years, the
legislation caps basic local exchange rates at the
maximum rate set by for regulated companies within the
state during the overall transition period, with an
annual cap not exceeding an amount equal to 10% of the
company rate in effect at the time of the election to
come under the provisions of the Act.
The legislation prohibits rural rate increases above
the rate established in the company's most populous
urban area, thus giving the rural customer the benefit
of the competition that now exists and will continue
to grow, in the urban areas. This provision does not
sunset or end with the conclusion of the transition
period.
No price increase after June 30, 2005, will affect the
eligibility of rural companies to draw from the
Universal Service Fund.
Guarantees that a customer will always have the option
of "plain old telephone service" (POTS), without
having to take package plans or services the customer
does not want.
Provides customer remedy for unauthorized third-party
service provider billings on customer telephone bill.
Provides the Public Utilities Commission with
continuing authority over basic local exchange service
quality standards, billing practices and procedures,
and customer notice and customer-relations rules.
Does not interfere with the continued availability of
the Idaho Telecommunications Service Assistance Plan
(ITSAP) to assist low-income persons to obtain lower
cost telephone service within the state. [I.C. Chapter
9, Title 56]
FISCAL NOTE
There is no fiscal impact on the General Fund.
Contact:
Edward Lodge, Qwest
Phone: (208) 385-2154
Bill Roden
Phone: (208) 866-8113
(208) 336-7930
STATEMENT OF PURPOSE/FISCAL NOTE H 224