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H0741......................................................by STATE AFFAIRS
TELECOMMUNICATIONS ACT OF 2006 - Adds to, amends and repeals existing law
to enact the "Telecommunications Act of 2006"; and to revise the authority
of the Public Utilities Commission to regulate telecommunications carriers.
02/27 House intro - 1st rdg - to printing
02/28 Rpt prt - to St Aff
]]]] LEGISLATURE OF THE STATE OF IDAHO ]]]]
Fifty-eighth Legislature Second Regular Session - 2006
IN THE HOUSE OF REPRESENTATIVES
HOUSE BILL NO. 741
BY STATE AFFAIRS COMMITTEE
1 AN ACT
2 RELATING TO TELECOMMUNICATIONS; AMENDING TITLE 62, IDAHO CODE, BY THE ADDITION
3 OF A NEW CHAPTER 14, TITLE 62, IDAHO CODE, TO PROVIDE A SHORT TITLE, TO
4 PROVIDE LEGISLATIVE INTENT, TO DEFINE TERMS, TO PROVIDE APPLICABILITY OF
5 THE CHAPTER AND TO PROVIDE FOR REPEAL OF LAWS IN CONFLICT WITH THE CHAP-
6 TER, TO PROVIDE JURISDICTION AND AUTHORITY OF THE PUBLIC UTILITIES COMMIS-
7 SION, TO PROVIDE FOR REGISTRATION CERTIFICATES, TO PROVIDE A REQUIREMENT
8 FOR PRICE LIST FILING, TO PROVIDE FOR UNIVERSAL SERVICE, TO PROVIDE UNI-
9 VERSAL SERVICE RATES, TO PROVIDE PRICE RESTRICTIONS ON CERTAIN TELEPHONE
10 CORPORATIONS, TO PROVIDE A UNIVERSAL SERVICE FUND, TO PROVIDE FOR UNIVER-
11 SAL SERVICE FUND SUPPORT, TO ALLOW BUNDLING, TO PROVIDE RESTRICTIONS ON
12 TELECOMMUNICATIONS CARRIERS, TO PROVIDE RESTRICTIONS ON RESALE OF CERTAIN
13 TELECOMMUNICATION SERVICES, TO PROVIDE RESTRICTIONS ON WITHDRAWAL OR DIS-
14 CONTINUANCE OF SERVICE, TO PROVIDE A CARRIER OF LAST RESORT AND PUBLIC
15 UTILITIES COMMISSION AUTHORITY, TO PROVIDE FOR PUBLIC UTILITIES COMMISSION
16 AUTHORITY TO RESOLVE SUBSCRIBER COMPLAINTS, TO PROVIDE RESOLUTION OF
17 INTER-TELECOMMUNICATIONS CARRIER DISPUTES, TO PROVIDE FOR TELECOMMUNICA-
18 TIONS CARRIER ANTITRUST LIABILITY, TO PROVIDE FOR PREEMPTION, TO PROVIDE
19 FOR PROCEDURE BEFORE THE PUBLIC UTILITIES COMMISSION AND APPEALS, TO PRO-
20 VIDE CIVIL PENALTIES FOR VIOLATION, TO PROVIDE FOR REGULATORY FEES AND TO
21 PROVIDE SEVERABILITY; REPEALING CHAPTER 6, TITLE 62, IDAHO CODE, RELATING
22 TO THE TELECOMMUNICATIONS ACT OF 1988, REPEALING SECTION 61-121, IDAHO
23 CODE, RELATING TO THE DEFINITION OF TELEPHONE CORPORATION AND TELECOMMUNI-
24 CATION SERVICE; REPEALING SECTION 61-622A, IDAHO CODE, RELATING TO PUBLIC
25 UTILITIES COMMISSION AUTHORITY AND COST ALLOCATION FOR TELECOMMUNICATION
26 SERVICE; AMENDING SECTION 61-526, IDAHO CODE, TO DELETE REFERENCE TO TELE-
27 PHONE CORPORATION; AMENDING SECTION 62-701, IDAHO CODE, TO PROVIDE COOPER-
28 ATIVE OR MUTUAL NONPROFIT TELEPHONE COMPANIES' ABILITY TO USE HIGHWAYS;
29 AMENDING SECTION 62-702, IDAHO CODE, TO PROVIDE REMEDIES TO TELECOMMUNICA-
30 TIONS CARRIERS IF THEIR PROPERTY IS INJURED; AMENDING SECTION 26-2239,
31 IDAHO CODE, TO PROVIDE AN EXEMPTION TO TELECOMMUNICATIONS CARRIERS FROM
32 THE STATUTE REGULATING COLLECTION AGENCIES; AMENDING SECTION 48-1009,
33 IDAHO CODE, TO PROVIDE A CORRECT STATUTORY CITATION AND TO MAKE A TECHNI-
34 CAL CORRECTION; AMENDING SECTION 61-1302, IDAHO CODE, TO REVISE THE DEFI-
35 NITION OF MESSAGE TELECOMMUNICATIONS SERVICE AND TELEPHONE CORPORATION AND
36 TO MAKE TECHNICAL CORRECTIONS; AMENDING SECTION 61-1305, IDAHO CODE, TO
37 PROVIDE A CORRECT STATUTORY CITATION; AMENDING SECTION 63-201, IDAHO CODE,
38 TO REVISE THE DEFINITION OF PUBLIC UTILITY; AND AMENDING SECTION 63-3027,
39 IDAHO CODE, TO PROVIDE APPLICATION TO A TELECOMMUNICATIONS CARRIER AND TO
40 MAKE TECHNICAL CORRECTIONS.
41 Be It Enacted by the Legislature of the State of Idaho:
42 SECTION 1. That Title 62, Idaho Code, be, and the same is hereby amended
43 by the addition thereto of a NEW CHAPTER, to be known and designated as Chap-
44 ter 14, Title 62, Idaho Code, and to read as follows:
2
1 CHAPTER 14
2 TELECOMMUNICATIONS ACT OF 2006
3 62-1401. SHORT TITLE. This chapter shall be known and may be referred to
4 as the "Telecommunications Act of 2006."
5 62-1402. LEGISLATIVE INTENT. (1) The legislature of the state of Idaho
6 finds that telecommunications services are essential to the health, welfare
7 and economic well-being of the citizens of the state of Idaho and there is a
8 continuing need for legislation to protect and maintain high-quality universal
9 telecommunications at affordable rates for all classes of customers and to
10 encourage innovation within the industry by a balanced program of regulation
11 and competition.
12 (2) The legislature further finds that the telecommunications industry is
13 in a state of transition from a regulated public utility industry to a compet-
14 itive industry. The legislature encourages the development of open competition
15 in the telecommunications industry in accordance with provisions of Idaho law
16 and consistent with the federal telecommunications act of 1996. This chapter
17 therefore removes telephone companies from traditional public utility regula-
18 tion and establishes reasonable provisions recognizing the transition to a
19 competitive industry.
20 (3) The commission shall administer these statutes with respect to tele-
21 communications rates and services in accordance with these policies and appli-
22 cable federal law.
23 62-1403. DEFINITIONS. As used in this chapter:
24 (1) "Access line" means a communications facility provisioned for a spe-
25 cific customer to enable telecommunication service to be provided to that cus-
26 tomer.
27 (2) "Basic local exchange rate" means the monthly charge imposed by a
28 telecommunications carrier for basic local exchange service, not including any
29 charges resulting from action by a federal agency or taxes or surcharges
30 imposed by a governmental body that are separately itemized and billed by a
31 telecommunications carrier to its customers.
32 (3) "Basic local exchange service" means the provision of access lines to
33 residential and small business customers with the associated transmission of
34 two-way interactive voice communication within a local exchange calling area.
35 (4) "Carrier of last resort" means a telecommunications carrier that is
36 required to provide universal service on reasonable terms and conditions to
37 all customers within a service area designated by the commission. No telecom-
38 munications carrier shall be designated a carrier of last resort except upon
39 its application to the commission requesting such designation. Incumbent local
40 exchange carriers shall be designated carriers of last resort only within
41 their previously certificated service areas.
42 (5) "Commercial mobile radio service provider" means a provider of com-
43 mercial mobile service as defined in 47 U.S.C. section 332(d).
44 (6) "Commission" means the Idaho public utilities commission.
45 (7) "Incumbent local exchange carrier" means a telecommunications carrier
46 or its successor in interest that was providing basic local exchange service
47 within the state of Idaho on or before February 8, 1996.
48 (8) "Interexchange calling" or "message telecommunications service" means
49 the transmission of two-way interactive voice communication between local
50 exchange calling areas, excluding services offered by commercial mobile radio
51 service providers.
52 (9) "Local exchange calling area" means a geographic area encompassing
3
1 one (1) or more communities described in maps, tariffs or other descriptive
2 material filed with the commission where local exchange rates apply. For the
3 purpose of determining whether a call is a local exchange call or an
4 interexchange call to which access charges apply, a call is not a local call
5 if the originating telecommunications carrier's tariff or price list does not
6 classify the call as a local call.
7 (10) "Local exchange carrier" means a telecommunications carrier that pro-
8 vides local exchange service within one (1) or more local exchange calling
9 areas within the state of Idaho.
10 (11) "Local exchange service" means the provision of access lines to cus-
11 tomers with the associated transmission of two-way interactive communication
12 within a local exchange calling area.
13 (12) "Originating telecommunications carrier" means the telecommunications
14 carrier whose end user customer initiates a telecommunications transmission
15 and who receives the end user's payment, if any, for that transmission.
16 (13) "Residential customer" means a person or persons to whom telecommuni-
17 cation service is furnished primarily for personal or domestic purposes and
18 not primarily for business, professional or institutional purposes.
19 (14) "Service area" means a geographic area in which a carrier of last
20 resort has been designated by the commission for the purpose of providing uni-
21 versal service.
22 (15) "Small business customer" shall mean a business entity, whether an
23 individual, partnership, corporation, hospital, or school, or any other busi-
24 ness form, to whom basic local exchange service is furnished for occupational,
25 professional or institutional purposes, and which business entity does not
26 subscribe to more than five (5) access lines billed to a single billing loca-
27 tion.
28 (16) "Stand-alone basic local exchange rate" means the monthly charge made
29 by a telecommunications carrier to a residential or small business basic local
30 exchange service customer for a single access line that is not included in a
31 package of services or price discounted in a promotional offering, not includ-
32 ing any charges resulting from action by a federal agency or taxes or
33 surcharges imposed by a governmental body that are separately itemized and
34 billed by the telecommunications carrier to its customers.
35 (17) "Telecommunication service" means the transmission of two-way inter-
36 active sounds, messages, data, or other information of any nature by wire,
37 radio, lightwaves, or other electromagnetic means, together with associated
38 signals, which originate and terminate in this state, and are offered to or
39 for the public, or some portion thereof. Except as otherwise provided by stat-
40 ute, "telecommunication service" does not include:
41 (a) The transmission of video programming or other programming service
42 and subscriber interaction, if any, which is required for the selection of
43 such programming service;
44 (b) Paging or answering services, including computerized or otherwise
45 automated answering or voice message services; or
46 (c) Information service or internet access service.
47 (18) "Telecommunications act of 1996" means the federal telecommunications
48 act of 1996, public law no. 104-104, as enacted effective February 8, 1996.
49 (19) "Telecommunications carrier" means any person or business entity pro-
50 viding telecommunication service within this state except a commercial mobile
51 radio service provider unless the commercial mobile service provider requests,
52 and is granted, carrier of last resort status.
53 (20) "Telephone corporation" means any telecommunications carrier except:
54 (a) A cooperative or mutual nonprofit telephone company; or
55 (b) A commercial mobile radio service provider.
4
1 (21) "Transition period" means a time period of three (3) years from the
2 effective date of the election by a telephone corporation, pursuant to section
3 62-605(1) and (2), Idaho Code, as said section was amended by chapter 200,
4 laws of 2005, to exclude basic local exchange services from regulation pursu-
5 ant to title 61, Idaho Code, or pursuant to section 62-622(1), Idaho Code, as
6 those provisions of law existed prior to the effective date of this act, or to
7 determine its own universal service or basic local exchange service rates for
8 residential and small business customers throughout its service area pursuant
9 to section 62-1409(2), Idaho Code, whichever election date first occurred.
10 The commission may by order during the one hundred eighty (180) day period
11 prior to the expiration of this transition period, extend the transition
12 period for two (2) additional years if the commission finds that such action
13 is necessary to protect the public interest. The commission shall, if the
14 transition period is extended as provided herein, file a copy of the
15 commission's order with the governor and the legislature.
16 (22) "Universal service" means basic local exchange service and any other
17 telecommunication services that may be designated by the commission, in accor-
18 dance with the provisions of section 62-1408, Idaho Code, that carriers of
19 last resort must make reasonably available to all persons who request such
20 services within their service areas.
21 (23) "Weighted statewide average rate" means the average rate paid by
22 Idaho telecommunication service customers for the intrastate service in ques-
23 tion, not including any disaggregated component of bundled rates. For the
24 purpose of determining eligibility for distributions from the universal ser-
25 vice fund established by section 62-1411, Idaho Code, the basic local exchange
26 service rates in effect on July 1, 2005, shall constitute the basis for such
27 calculation, unless the commission determines that changes in basic local
28 exchange service rates subsequent to July 1, 2005, should be used for such
29 calculations.
30 62-1404. APPLICABILITY OF CHAPTER -- REPEAL OF LAWS IN CONFLICT WITH THIS
31 CHAPTER. (1) All telecommunication service and telecommunications carriers
32 shall, on and after the effective date of this act, be regulated pursuant to
33 the provisions of this chapter, and not pursuant to the provisions of chapters
34 1 through 10, title 61, Idaho Code, except as specifically adopted by refer-
35 ence in this chapter. Any provisions of law that are inconsistent or in con-
36 flict with the provisions of this chapter shall be, and are hereby repealed,
37 to the extent of their applicability to telecommunication service within the
38 state of Idaho.
39 (2) Notwithstanding any other provision of this chapter, a telecommunica-
40 tions carrier that was subject to the provisions of section 61-538, Idaho
41 Code, prior to the effective date of this act shall continue to be subject to
42 the provisions of such section.
43 62-1405. COMMISSION JURISDICTION AND AUTHORITY. The commission shall have
44 continuing jurisdiction and authority to administer and enforce the express
45 provisions of this chapter. In addition, subject to the limitations and condi-
46 tions contained elsewhere in this chapter, the commission shall have the fol-
47 lowing general jurisdiction and authority over telecommunication service, and
48 may promulgate rules as necessary to carry out its duties pursuant to this
49 chapter to:
50 (1) Determine the noneconomic regulatory requirements relating to basic
51 local exchange service for all telephone corporations who provide basic local
52 exchange service including, but not limited to, such matters as basic local
53 exchange service quality standards, provision of access to telecommunications
5
1 carriers providing interexchange calling or message telecommunications ser-
2 vice, filing of price lists, customer notices and customer relation rules, and
3 billing practices and procedures, which requirements shall be technologically
4 and competitively neutral.
5 (2) Provide by rule for the maintenance of uniform systems of accounts
6 and business records by telephone corporations who elect to have their univer-
7 sal service rates determined under section 62-1409(1), Idaho Code.
8 (3) Designate telecommunications carriers as carriers of last resort in
9 accordance with uniform criteria established by the commission and supervise
10 the payment of universal service fund support in accordance with the terms of
11 this chapter.
12 (4) Establish universal service rates for incumbent local exchange carri-
13 ers that are also telephone corporations who elect to have universal service
14 rates established in accordance with section 62-1409(1), Idaho Code.
15 (5) Require the production of a telephone corporation's books, records,
16 or other material or evidence as necessary for the performance of the
17 commission's duties, and to issue subpoenas compelling the attendance of wit-
18 nesses at commission proceedings.
19 (6) Maintain on file for public inspection telephone corporations' sched-
20 ules of rates, charges and conditions of service for telecommunication ser-
21 vices.
22 (7) Participate and represent the interests of the general public and
23 Idaho telecommunication service customers in any proceeding before local,
24 state or federal public officials or agencies.
25 (8) Perform such duties as may be expressly authorized or required of the
26 commission by the communications act of 1934, as amended, and regulations law-
27 fully promulgated thereunder.
28 (9) Nothing in this chapter shall be construed to grant the commission
29 jurisdiction or authority over products or services over which the federal
30 government has exercised, and continues to exercise, its power to preempt
31 state regulation, regardless of whether such preemption is contained in fed-
32 eral statutes, judicial decisions, or federal communications commission
33 orders. Except as expressly provided in sections 62-1406(1), 62-1411(1), and
34 62-1414, Idaho Code, nothing in this chapter shall be construed to grant the
35 commission jurisdiction over commercial mobile radio service providers unless
36 such a provider becomes a carrier of last resort, in which case the
37 commission's jurisdiction over such provider pursuant to this chapter shall
38 attach only to the commercial mobile radio service provider's activities
39 within the commercial mobile radio service provider's service area.
40 62-1406. REGISTRATION CERTIFICATES. (1) All telecommunications carriers
41 and commercial mobile radio service providers shall file with the commission,
42 with updates as necessary to keep the information current, a registration cer-
43 tificate setting forth the following information:
44 (a) The name of the telecommunications carrier or commercial mobile radio
45 service provider and the address of its principal place of business within
46 the state;
47 (b) A brief, general description of the telecommunication services
48 offered by such telecommunications carrier or commercial mobile radio ser-
49 vice provider and the general area served by it or in which it offers
50 telecommunication services;
51 (c) The name, address and telephone number of a representative or repre-
52 sentatives authorized to respond to commission and customer inquiries or
53 complaints.
54 (2) All carriers of last resort shall file with the commission, in addi-
6
1 tion to the information required in subsection (1) of this section, maps
2 depicting their local calling area or areas and service area or areas.
3 (3) The registration statements required by this section shall be public
4 information and shall be made reasonably available to the public at all times
5 during normal business hours.
6 62-1407. REQUIREMENT FOR PRICE LIST FILING. All incumbent local exchange
7 carriers and carriers of last resort that draw from the universal service fund
8 and provide universal service, local exchange service, interexchange service,
9 wide area telecommunications service (WATS) or access to their local exchange
10 network for the provision of such services by the use of special access or
11 private line access and switched access, or their equivalents, shall file with
12 the commission price lists that reflect the availability, prices, and terms
13 and conditions for those services. Incumbent local exchange carriers and car-
14 riers of last resort shall provide such services only in accordance with such
15 price lists unless modified by individually negotiated telecommunication ser-
16 vice contracts. Changes to such price lists, except as hereinafter provided,
17 shall be effective not less than ten (10) days after filing with the commis-
18 sion and giving public notice to affected customers. Changes to price lists
19 that are for nonrecurring services and that are quoted directly to the cus-
20 tomer when an order is placed, or changes that result in price reductions,
21 shall be effective immediately but shall be filed with the commission within
22 thirty (30) days after the effective date and no other public notice shall be
23 required. The commission shall by rule establish the form of such price lists
24 and make the same available for public inspection.
25 62-1408. UNIVERSAL SERVICE. Universal service is an evolving level of
26 telecommunication services to which consumers in all regions of the state
27 should have access. The commission may review the level of telecommunication
28 services within the state on a periodic basis and designate those services in
29 addition to basic local exchange service that should be made available to con-
30 sumers by carriers of last resort to meet their obligations to provide univer-
31 sal service. The commission shall consider definitions of universal service
32 adopted by the federal communications commission pursuant to the telecommuni-
33 cations act of 1996, but the commission shall not add additional telecommuni-
34 cation services to the definition of universal service unless the commission
35 allows carriers of last resort to recover the additional costs of providing
36 and maintaining such additional services, either through increased rates or
37 universal service funding, or both, and further finds that such telecommunica-
38 tion services:
39 (1) Have, through the operation of market choices by customers, been sub-
40 scribed to by a substantial majority of residential customers;
41 (2) Are being deployed in public telecommunications networks by telecom-
42 munications carriers throughout the state; and
43 (3) Are necessary to serve the public interest, convenience and neces-
44 sity.
45 62-1409. UNIVERSAL SERVICE RATES. On or before the effective date of this
46 act, and on the first business day of each year thereafter, each incumbent
47 local exchange carrier that is also a telephone corporation and designated as
48 a carrier of last resort shall elect to have its rates for universal service
49 for residential customers and small business customers determined by one (1)
50 of the following methods:
51 (1) The commission shall initially determine just and reasonable rates
52 for universal service and intrastate access charges based upon the telephone
7
1 corporation's total revenue requirement for such services, including a reason-
2 able rate of return on the telephone corporation's intrastate investment in
3 telecommunications facilities. At the request of the telephone corporation,
4 the commission may find that rates previously established by the commission
5 under title 61, Idaho Code, shall constitute the rates for universal service
6 for the purposes of this section. The rates determined in accordance with this
7 subsection (1) shall remain in effect until changed by commission order at the
8 carrier of last resort's request.
9 (2) The telephone corporation may determine its own universal service
10 rates for residential customers and small business customers throughout its
11 service area.
12 62-1410. PRICE RESTRICTIONS ON CERTAIN TELEPHONE CORPORATIONS. An incum-
13 bent telephone corporation which held a certificate of convenience and neces-
14 sity on January 1, 1988, issued by the commission, and which telephone corpo-
15 ration, pursuant to sections 62-604 and 62-605, Idaho Code, as amended by
16 chapter 200, laws of 2005, elected to exclude all of its telecommunication
17 services, including basic local exchange service, from regulation pursuant to
18 title 61, Idaho Code, and telephone corporations that elect to establish their
19 own rates for universal service pursuant to section 62-1409(2), Idaho Code,
20 shall be subject to the following pricing restrictions during the transition
21 period defined in section 62-1403(21), Idaho Code:
22 (1) During the first year of the transition period the price for stand-
23 alone basic local exchange service shall be capped at a rate of ten percent
24 (10%) above the rates in effect at the time of the election;
25 (2) During each succeeding year of the transition period the price cap
26 shall be increased by an additional amount equal to the difference between the
27 rate at the time of the election and the price cap established hereunder for
28 the first year of the transition period;
29 (3) The price cap established during the transition period shall in no
30 event exceed the maximum basic local exchange rate determined by the commis-
31 sion for any telephone corporation within the state of Idaho on the date the
32 telephone corporation made its election; and
33 (4) The telephone corporation shall not increase its stand-alone basic
34 local exchange service rate to residential or small business customers in any
35 local exchange calling area to an amount that is higher than that telephone
36 corporation's stand-alone basic local exchange rate for residential and small
37 business customers in the telephone corporation's local exchange calling area
38 having the highest number of basic local exchange service residential or busi-
39 ness customers within the state.
40 62-1411. UNIVERSAL SERVICE FUND. (1) There is hereby established an Idaho
41 universal service fund to be supervised and administered by the commission.
42 Revenue for the fund shall be collected through a uniform universal service
43 fund surcharge as determined by the commission. The commission shall establish
44 the surcharge at a level that is sufficient to fund universal service fund
45 payments on a continuing basis. The surcharge shall be imposed on each tele-
46 communications carrier's and each commercial mobile service provider's retail
47 end user telephone numbers in use within the state of Idaho and shall be col-
48 lected by the telecommunications carrier, commercial mobile service provider,
49 or other provider utilizing a North American numbering plan number assigned to
50 a specific end user that provides that end user with the ability to receive
51 calls. The commission shall establish equitable numbering methods for the
52 assessment of multinumber residence, business or data service end users. Any
53 balances held in the Idaho universal service fund created by section 62-610,
8
1 Idaho Code, shall, on the effective date of this act, be transferred by the
2 commission to the Idaho universal service fund created by this section.
3 (2) The commission shall designate geographic service areas for which
4 financial assistance shall be made available from the fund to assist carriers
5 of last resort to meet universal service obligations. Carriers of last resort
6 receiving financial support shall use that support only for the provision,
7 maintenance and upgrading of services and facilities for which the support is
8 intended.
9 (3) The commission shall establish procedures to administer the Idaho
10 universal service fund and shall contract with a neutral third party for
11 administration of the fund. The administrator shall perform the duties
12 required by the commission including data gathering, collecting the surcharge
13 revenues, disbursing funds, and notifying the commission of any fund viola-
14 tions.
15 62-1412. UNIVERSAL SERVICE FUND SUPPORT. Carriers of last resort who
16 received distributions prior to the effective date of this act from the Idaho
17 universal service fund created by section 62-610, Idaho Code, under prior law,
18 and who elect to have their universal service rates established pursuant to
19 section 62-1409(2), Idaho Code, shall continue to receive support from the
20 Idaho universal service fund at the levels previously approved by the commis-
21 sion during the transition period. Thereafter, such companies and, from the
22 effective date of this act, all other carriers of last resort shall receive
23 support from the Idaho universal service fund only in the manner prescribed in
24 this section.
25 (1) Carriers of last resort who elect to be price regulated pursuant to
26 section 62-1409(1), Idaho Code, shall receive monthly Idaho universal service
27 fund support sufficient to meet any unrecovered, residual revenue requirement
28 from all jurisdictional revenue sources after universal service rates are
29 established at one hundred twenty-five percent (125%) or more of the weighted
30 statewide average rate and switched access charges are established equal to
31 one hundred percent (100%) of the weighted statewide average rate.
32 (2) Carriers of last resort who serve less than fifteen thousand (15,000)
33 total access lines in the state of Idaho and serve a service area with less
34 than fifteen (15) incumbent local exchange carrier access lines per square
35 mile, may elect to receive for each residential and business access line for
36 which it provides carrier of last resort service within its service area an
37 amount equal to seventy-five percent (75%) of the average Idaho universal ser-
38 vice fund support per residential or business access line, as the case may be,
39 as of the effective date of this act, provided that such carriers shall file
40 price lists with universal service rates for residential customers and small
41 business customers of not less than seventy-five percent (75%) nor more than
42 one hundred twenty-five percent (125%) of the weighted statewide average rate.
43 (3) On or before June 1 of each year, each carrier of last resort that
44 receives universal service funding pursuant to subsection (2) of this section,
45 shall file an application with the commission, in a form similar to that
46 required by section 63-3029I(4), Idaho Code, requesting approval of all uni-
47 versal service fund expenditures for the prior calendar year. Such applica-
48 tion shall include a notarized certification by an officer of the applicant
49 that universal service funds have been expended for the provision, maintenance
50 or upgrading of services and facilities for which the support is intended, as
51 well as a list of the expenditures by account. Should the commission determine
52 that any portion of the expenditures was not used for the purposes for which
53 support is intended, the commission shall subtract that amount from the
54 applicant's then current year's universal service fund distribution or order
9
1 immediate restitution of the amount disallowed.
2 62-1413. BUNDLING ALLOWED. All carriers of last resort shall offer uni-
3 versal service as a stand-alone basic local exchange rate service option, but
4 nothing in this chapter shall limit prices for bundled services that include
5 universal service, nor require a carrier of last resort to state a separate
6 price for universal service that is offered as part of a package of goods or
7 services.
8 62-1414. TELECOMMUNICATIONS CARRIER RESTRICTIONS. Except upon the agree-
9 ment of the telecommunications carriers or commercial mobile radio service
10 provider(s) involved, no originating telecommunications carrier or commercial
11 mobile radio service provider shall:
12 (1) Charge other telecommunications carriers or commercial mobile radio
13 service providers for the transport or termination of the originating
14 carrier's telecommunication service other than originating 800 number service;
15 or
16 (2) Transmit or transport telecommunication traffic without a telephone
17 number, carrier identification code, or some other identifier or identifying
18 mechanism consistent with general industry practices and sufficient to enable
19 all other telecommunications carriers or commercial mobile radio service
20 providers participating in the delivery of the telecommunication traffic to
21 identify the originating telecommunications carrier or commercial mobile radio
22 service provider and, if appropriate, bill that telecommunications carrier or
23 commercial mobile radio service provider for services provided.
24 62-1415. RESTRICTIONS ON RESALE. Telecommunications carriers shall not
25 resell:
26 (1) A telecommunication service that is available at retail only to a
27 specified category of subscribers to a different category of subscribers; or
28 (2) A means-tested service to ineligible customers.
29 62-1416. RESTRICTION ON WITHDRAWAL OR DISCONTINUANCE OF SERVICE. (1) A
30 carrier of last resort may not withdraw or otherwise discontinue basic local
31 exchange service to a local exchange calling area unless one (1) or more
32 alternative telecommunications carriers are furnishing the respective telecom-
33 munication service or equivalent service to the customers in such local
34 exchange calling area at the time such service is withdrawn or otherwise dis-
35 continued.
36 (2) A carrier of last resort proposing to withdraw or otherwise discon-
37 tinue services as set forth in subsection (1) of this section to a local
38 exchange area shall file a notice of such withdrawal or discontinuance of ser-
39 vice with the commission and shall publish a notice of such withdrawal in a
40 legal newspaper circulated within the local exchange area, and provide such
41 other reasonable notice as may be required by the commission.
42 (3) Any person or telecommunications carrier affected by a withdrawal or
43 discontinuance of such services by a carrier of last resort subject to this
44 chapter may, within thirty (30) days from the date of publication of the
45 notice, apply to the commission to determine whether such withdrawal or dis-
46 continuance of service is authorized pursuant to this section.
47 62-1417. CARRIER OF LAST RESORT -- COMMISSION AUTHORITY. If the commis-
48 sion determines that the public interest requires the extension of universal
49 service to an area or community that does not have such services available,
50 and if no telecommunications carrier will voluntarily provide such service on
10
1 reasonable terms, the commission may require any carrier of last resort to
2 provide universal service to the area on such terms as are just, reasonable
3 and compensatory to the designated carrier of last resort. The commission
4 shall by order provide for one (1) or more payments from the Idaho universal
5 service fund or, notwithstanding any other provisions of this chapter, author-
6 ize the carrier of last resort to charge rates for such service within such
7 area or community that, together with payments from the universal service
8 fund, will be sufficient to support the capital cost and the ongoing expense
9 of providing service to the affected area or community whether or not the car-
10 rier of last resort is otherwise eligible for payment from the Idaho universal
11 service fund.
12 62-1418. COMMISSION AUTHORITY TO RESOLVE SUBSCRIBER COMPLAINTS. (1) If an
13 alternative dispute resolution process is not otherwise provided by contract,
14 municipal or local franchise requirements, or a cooperative telephone
15 company's written policies, the commission shall have the authority to inves-
16 tigate and resolve complaints made by telecommunications carrier customers
17 concerning the quality and availability of universal service, deposit require-
18 ments for such service or disconnection of such service, or whether price and
19 conditions of other telecommunications services are in conformance with filed
20 tariffs or price lists. The commission may grant or deny in whole or in part
21 the subscriber's complaint and order reparation, a billing credit, or provide
22 other noneconomic relief as is reasonable based on the evidence. Any final
23 order of the commission entered pursuant to this section may be enforced
24 against any telecommunications carrier by an affected person or by the commis-
25 sion.
26 (2) If a telephone corporation customer notifies the telephone corpora-
27 tion that an unauthorized charge from a third party service provider has been
28 included on the telephone customer's bill by the telephone corporation, the
29 telephone corporation shall remove the disputed charge from the bill and shall
30 credit to the customer any amounts for unauthorized charges, whether paid or
31 unpaid, that were billed by the telephone corporation on behalf of the third
32 party service provider during the period of six (6) months prior to the
33 customer's notification to the telephone corporation that unauthorized charges
34 from a third party provider have been included on the telephone corporation
35 customer's bill. Nothing contained herein shall restrict the right of the
36 telephone corporation to recover credited charges from the third party service
37 provider.
38 62-1419. RESOLUTION OF INTER-TELECOMMUNICATIONS CARRIER DISPUTES. (1) If
39 two (2) or more telephone corporations or cooperative telephone companies are
40 unable to agree on any matter relating to telecommunication service issues
41 between such companies, and an alternative dispute resolution process is not
42 otherwise provided by the telephone corporations' or cooperative telephone
43 companies' contractual agreements or otherwise dictated by law, then either
44 company may apply to the commission for determination of the matter.
45 (2) Upon receipt of the application, the commission shall have jurisdic-
46 tion to conduct an investigation or evidentiary hearings, and to issue its
47 findings and order determining such dispute in accordance with applicable pro-
48 visions of law.
49 62-1420. TELECOMMUNICATIONS CARRIER ANTITRUST LIABILITY. (1) No action
50 under the antitrust laws or any other provision or doctrine of law of the
51 state of Idaho shall lie against a telecommunications carrier for providing
52 service in compliance with any order of the commission, provided however, this
11
1 section shall not apply to commission approval or acknowledgment of an elec-
2 tion pursuant to section 62-1409(2), Idaho Code, or prior law, except to the
3 extent such service thereafter is the subject of a specific commission order.
4 (2) A telecommunications carrier may file a petition with the commission
5 alleging that another telecommunications carrier, not subject to regulation
6 under section 62-1409(1) or (2), Idaho Code, is offering local exchange ser-
7 vice to customers in a local exchange calling area at a price below its aver-
8 age variable cost of providing such service in the local exchange calling
9 area. The commission shall, if after a hearing it finds by a preponderance of
10 the evidence that the allegations contained in the petition are true, estab-
11 lish a minimum price for local exchange service of the telecommunications
12 carrier in the local exchange calling area, which minimum price shall reflect
13 the telecommunications carrier's average variable cost of providing such ser-
14 vice.
15 62-1421. PREEMPTION. The provisions of this chapter preempt, eliminate,
16 and prohibit any economic, franchise or licensing regulation of telecommunica-
17 tions carriers subject to this chapter by cities, counties, incorporated or
18 unincorporated areas, special use districts, or any other local governmental
19 entity of any kind.
20 62-1422. PROCEDURE BEFORE COMMISSION -- APPEALS. (1) In all matters aris-
21 ing under this chapter, which are submitted to the commission for decision,
22 order or review, procedure shall be governed by the commission's rules of
23 practice and procedure.
24 (2) Reconsideration of, appeal from, and stay of orders issued pursuant
25 to this chapter shall be governed by sections 61-624 through 61-638, Idaho
26 Code, as for orders of the commission in other matters.
27 62-1423. CIVIL PENALTY FOR VIOLATION. (1) Any telecommunications carrier
28 that violates or fails to comply with any final order, decision or rule duly
29 issued by the commission pursuant to this chapter shall be subject to a civil
30 penalty of not to exceed two thousand dollars ($2,000) for each day the viola-
31 tion continues.
32 (2) Actions to recover penalties under this chapter shall be brought in
33 the name of the state of Idaho, in the district court in and for the county in
34 which the cause of action or some part thereof arose, or in which the telecom-
35 munications carrier complained of, if any, has its principal place of busi-
36 ness, or in which the person, if any, complained of, resides. Such action
37 shall be commenced and prosecuted to final judgment by the attorney for the
38 commission. In any such action, all penalties incurred up to the time of com-
39 mencing the same may be sued for and recovered. In all such action, the proce-
40 dure and rules of evidence shall be the same as in ordinary civil actions,
41 except as otherwise herein provided. All fines and penalties recovered by the
42 state in any such action, together with the costs thereof, shall be paid into
43 the state treasury to the credit of the general fund. Any such action may be
44 compromised or discontinued on application of the commission upon such terms
45 as the court shall approve and order.
46 62-1424. REGULATORY FEES. Telephone corporations shall pay to the commis-
47 sion a special regulatory fee to be determined by the commission, pursuant to
48 procedures set forth in chapter 10, title 61, Idaho Code, in such amount as
49 may be reasonable and necessary to defray the amount to be expended by the
50 commission for expenses in supervising and regulating telephone corporations
51 pursuant to this chapter.
12
1 62-1425. SEVERABILITY. If a court of competent jurisdiction shall adjudge
2 to be invalid or unconstitutional any clause, sentence, paragraph, section or
3 part of this chapter, such judgment or decree shall not affect, impair, inval-
4 idate or nullify the remainder of this chapter, but the effect thereof shall
5 be confined to the clause, sentence, paragraph, section or part of this chap-
6 ter so adjudged to be invalid or unconstitutional.
7 SECTION 2. That Chapter 6, Title 62, Idaho Code, be, and the same is
8 hereby repealed.
9 SECTION 3. That Section 61-121, Idaho Code, be, and the same is hereby
10 repealed.
11 SECTION 4. That Section 61-622A, Idaho Code, be, and the same is hereby
12 repealed.
13 SECTION 5. That Section 61-526, Idaho Code, be, and the same is hereby
14 amended to read as follows:
15 61-526. CERTIFICATE OF CONVENIENCE AND NECESSITY. No street railroad cor-
16 poration, gas corporation, electrical corporation, telephone corporation or
17 water corporation, shall henceforth begin the construction of a street rail-
18 road, or of a line, plant, or system or of any extension of such street rail-
19 road, or line, plant, or system, without having first obtained from the com-
20 mission a certificate that the present or future public convenience and neces-
21 sity require or will require such construction: provided, that this section
22 shall not be construed to require such corporation to secure such certificate
23 for an extension within any city or county, within which it shall have there-
24 tofore lawfully commenced operation, or for an extension into territory
25 whether within or without a city or county, contiguous to its street railroad,
26 or line, plant or system, and not theretofore served by a public utility of
27 like character, or for an extension within or to territory already served by
28 it necessary in the ordinary course of its business: and provided further,
29 that if any public utility in constructing or extending its lines, plant or
30 system, shall interfere or be about to interfere with the operation of the
31 line, plant or system of any other public utility already constructed, or if
32 public convenience and necessity does not require or will require such con-
33 struction or extension, the commission on complaint of the public utility
34 claiming to be injuriously affected, or on the commission's own motion, may,
35 after hearing, make such order and prescribe such terms and conditions for the
36 locating or type of the line, plant or system affected as to it may seem just
37 and reasonable: provided, that power companies may, without such certificate,
38 increase the capacity of their existing generating plants.
39 SECTION 6. That Section 62-701, Idaho Code, be, and the same is hereby
40 amended to read as follows:
41 62-701. RIGHT TO USE HIGHWAYS. Telephone corporations or cooperative or
42 mutual nonprofit telephone companies may construct or install telephone lines
43 along, beneath the surface of or upon any public road or highway, or along,
44 beneath the surface of, or across any of the waters or lands within this
45 state, and may erect or install poles, posts, piers or abutments for support-
46 ing the insulators, wires and other necessary fixtures of their lines in such
47 manner and at such points as not to incommode the public use of the road or
48 highway, or interrupt the navigation of the waters.
13
1 SECTION 7. That Section 62-702, Idaho Code, be, and the same is hereby
2 amended to read as follows:
3 62-702. INJURY TO COMPANY'S PROPERTY. Any person who injures or destroys,
4 through want of proper care, any necessary or useful fixture of any telegraph
5 or telephone corporation telecommunications carrier, is liable to the corpora-
6 tion telecommunications carrier for all damages sustained thereby.
7 SECTION 8. That Section 26-2239, Idaho Code, be, and the same is hereby
8 amended to read as follows:
9 26-2239. EXEMPTIONS. The provisions of this chapter shall not apply to
10 the following:
11 (1) Any attorney-at-law duly authorized to practice in this state;
12 (2) Any regulated lender as defined in section 28-41-301(37), Idaho Code,
13 nor any subsidiary, affiliate or agent of such a regulated lender to the
14 extent that the subsidiary, affiliate or agent collects for the regulated
15 lender;
16 (3) Any trust company authorized to do business in this state;
17 (4) Any federal, state or local governmental agency or instrumentality;
18 (5) Any real estate broker or real estate salesman licensed under the
19 laws of and residing within this state when engaged in the regular practice of
20 a real estate business;
21 (6) Any abstract and title companies doing an escrow business;
22 (7) Any mortgage company to the extent that such mortgage company is
23 engaged in the regular business of a mortgage company as defined in section
24 26-2802, Idaho Code;
25 (8) Any court appointed trustee, receiver or conservator;
26 (9) Any telephone corporation telecommunications carrier, as defined in
27 subsection (109) of section 62-6031403, Idaho Code, whose initial request for
28 payment on behalf of such telephone corporation telecommunications carrier or
29 on behalf of another person is made by the telephone corporation telecommuni-
30 cations carrier as a part of regular telecommunications billings to its cus-
31 tomers and at a time before the account, bill, claim or other indebtedness
32 becomes past due or delinquent;
33 (10) A person while acting as a debt collector for another person, both of
34 whom are related by common ownership or affiliated by corporate control, if
35 the person acting as a debt collector does so only for persons to whom he is
36 so related or affiliated and if the principal business of such person is not
37 the collection of debts.
38 SECTION 9. That Section 48-1009, Idaho Code, be, and the same is hereby
39 amended to read as follows:
40 48-1009. CONSUMER NOTIFICATION -- RULE MAKING RULEMAKING BY THE IDAHO
41 PUBLIC UTILITIES COMMISSION. (1) Telephone corporations providing basic local
42 exchange service, as defined in section 62-6031403(20), Idaho Code, shall
43 inform customers of the provisions of this chapter. Publication of such noti-
44 fication in an annual insert in a billing statement mailed to customers or by
45 conspicuous publication in the consumer information pages of local telephone
46 directories shall relieve telephone corporations of any and all liability
47 under this chapter to purchasers or others claiming to have suffered harm from
48 telephone solicitors or by operation of the provisions of this chapter.
49 (2) The public utilities commission shall by rule prescribe the form of
50 such notice.
14
1 SECTION 10. That Section 61-1302, Idaho Code, be, and the same is hereby
2 amended to read as follows:
3 61-1302. DEFINITIONS. In this chapter:
4 (1) "Administrator" means the person with whom the Idaho public utilities
5 commission contracts to administer the program for delivery of telecommunica-
6 tions relay services.
7 (2) "Commission" means the Idaho public utilities commission.
8 (3) "Communications impaired" means individuals who are hearing-impaired
9 or speech-impaired as defined in title IV, section 401, Americans with dis-
10 abilities act of 1990, public law 101-336, 104 stat. 327, 336-69 (47 U.S.C.
11 section 225) or regulations promulgated pursuant thereto.
12 (4) "Local exchange company" means a telephone corporation which provides
13 access lines to residential and business customers with the associated trans-
14 mission of two (2) way interactive switched voice communication within a geo-
15 graphic area where basic local exchange rates rather than message telecommuni-
16 cations service rates apply.
17 (5) "Message telecommunications service" shall have the meaning pre-
18 scribed in section 62-603(6)1403(8), Idaho Code.
19 (6) "Program" means the effort directed by the administrator pursuant to
20 this chapter to establish and operate an Idaho system to provide telecommuni-
21 cations relay services.
22 (7) "Telephone corporation" shall have the meaning prescribed in section
23 62-603(10)1403(20), Idaho Code.
24 (8) "Telecommunications relay services (TRS)" means services through
25 which a communications impaired person, using specialized telecommunications
26 equipment, may send and receive messages to and from a noncommunications
27 impaired person whose telephone is not equipped with specialized telecommuni-
28 cations equipment and through which a noncommunications impaired person may,
29 by using voice communication, send and receive messages to and from a communi-
30 cations impaired person.
31 SECTION 11. That Section 61-1305, Idaho Code, be, and the same is hereby
32 amended to read as follows:
33 61-1305. PARTICIPATION IN PROGRAM. (1) All telephone corporations provid-
34 ing basic local exchange service within the state of Idaho and all telephone
35 corporations providing intrastate message telecommunications service within
36 the state of Idaho, including those otherwise exempt from the jurisdiction of
37 the commission pursuant to section 61-104, Idaho Code, and those providing
38 local exchange services or message telecommunications services pursuant to the
39 telecommunications act of 19882006, chapter 614, title 62, Idaho Code, shall
40 except as provided in subsection (2) of this section, provide TRS in accor-
41 dance with the program established by the commission, and shall pay into the
42 telecommunications relay services fund such sums as may represent the tele-
43 phone corporation's share of the cost of the program, based upon an allocation
44 methodology duly adopted by the commission in accordance with its rulemaking
45 procedures.
46 (2) The commission shall permit a telephone corporation to provide tele-
47 communications relay services to its customers by a TRS provider other than
48 the provider approved by the commission and shall waive the telephone
49 corporation's obligation to participate in the program if the commission
50 finds, upon application by a telephone corporation, that the following facts
51 exist:
52 (a) The telephone corporation will continue to meet its obligation to its
15
1 Idaho customers in accordance with the standards set forth in the Ameri-
2 cans with disabilities act; and
3 (b) The nonparticipation of such telephone corporation will not substan-
4 tially impair the operation or provision of TRS pursuant to the program
5 adopted by the commission.
6 (3) Each telephone corporation subject in whole or in part to the
7 commission's ratemaking authority may apply to the commission for authority to
8 increase its rates and charges in an amount not to exceed its payments to the
9 telecommunications relay services fund pursuant to this chapter or the costs
10 it incurs in providing TRS through an alternative TRS provider as authorized
11 by the commission pursuant to subsection (2) of this section. Such applica-
12 tions shall plainly state the amount of the proposed increase, its manner of
13 calculation, and the proposed recovery method, but shall not require a full
14 cost-of-service filing or general ratemaking presentation. The commission
15 shall promptly consider and act upon such applications.
16 SECTION 12. That Section 63-201, Idaho Code, be, and the same is hereby
17 amended to read as follows:
18 63-201. DEFINITIONS. As used for property tax purposes in title 63, chap-
19 ters 1 through 23, Idaho Code, the terms defined in this section shall have
20 the following meanings, unless the context clearly indicates another meaning:
21 (1) "Appraisal" means an estimate of property value for property tax pur-
22 poses.
23 (a) For the purpose of estimated property value to place the value on any
24 assessment roll, the value estimation must be made by the assessor or a
25 certified property tax appraiser.
26 (b) For the purpose of estimating property value to present for an appeal
27 filed pursuant to sections 63-501A, 63-407 and 63-409, Idaho Code, the
28 value estimation may be made by the assessor, a certified property tax
29 appraiser, a licensed appraiser, or a certified appraiser or any party as
30 specified by law.
31 (2) "Bargeline" means those water transportation tugs, boats, barges,
32 lighters and other equipment and property used in conjunction with waterways
33 for bulk transportation of freight or ship assist.
34 (3) "Cogenerators" means facilities which produce electric energy, and
35 steam or forms of useful energy which are used for industrial, commercial,
36 heating or cooling purposes.
37 (4) "Collection costs" are amounts authorized by law to be added after
38 the date of delinquency and collected in the same manner as property tax.
39 (5) "Delinquency" means any property tax, special assessment, fee, col-
40 lection cost, or charge collected in the same manner as property tax, that has
41 not been paid in the manner and within the time limits provided by law.
42 (6) "Improvements" means all buildings, structures, fixtures and fences
43 erected upon or affixed to the land, and all fruit, nut-bearing and ornamental
44 trees or vines not of natural growth, growing upon the land, except nursery
45 stock.
46 (7) "Late charge" means a charge of two percent (2%) of the delinquency.
47 (8) "Lawful money of the United States" means currency and coin of the
48 United States at par value and checks and drafts which are payable in dollars
49 of the United States at par value, payable upon demand or presentment.
50 (9) "Manufactured home" means a structure defined as a manufactured home
51 in section 39-4105, Idaho Code.
52 (10) "Market value" means the amount of United States dollars or equiva-
53 lent for which, in all probability, a property would exchange hands between a
16
1 willing seller, under no compulsion to sell, and an informed, capable buyer,
2 with a reasonable time allowed to consummate the sale, substantiated by a rea-
3 sonable down or full cash payment.
4 (11) "Operating property" means all rights-of-way accompanied by title;
5 roadbeds; tracks; pipelines; bargelines; equipment and docks; terminals;
6 rolling stock; equipment; power stations; power sites; lands; reservoirs, gen-
7 erating plants, transmission lines, distribution lines and substations; and
8 all immovable or movable property operated in connection with any public util-
9 ity, railroad or private railcar fleet, wholly or partly within this state,
10 and necessary to the maintenance and operation of such road or line, or in
11 conducting its business, and shall include all title and interest in such
12 property, as owner, lessee or otherwise. The term does not include personal
13 property exempt from taxation pursuant to section 63-602L, Idaho Code.
14 (12) "Party in interest" means a person who holds a properly recorded
15 mortgage, deed of trust or security interest.
16 (13) "Person" means any entity, individual, corporation, partnership,
17 firm, association, limited liability company, limited liability partnership or
18 other such entities as recognized by the state of Idaho.
19 (14) "Personal property" includes all goods, chattels, stocks and bonds,
20 equities in state lands, easements, reservations, leasehold real properties
21 and all other property which the law defines, or the courts may interpret,
22 declare and hold to be personal property under the letter, spirit, intent and
23 meaning of the law, for the purposes of property taxation. For the purposes of
24 payment and collection of property taxes pursuant to chapter 9, title 63,
25 Idaho Code, collection of delinquency pursuant to chapter 10, title 63, Idaho
26 Code, and seizure and sale of personal property for taxes pursuant to chapter
27 11, title 63, Idaho Code, personal property includes manufactured homes not
28 declared as real property pursuant to section 63-304, Idaho Code.
29 (15) "Private railcar fleet" means railroad cars or locomotives owned by,
30 leased to, occupied by or franchised to any person other than a railroad com-
31 pany operating a line of railroad in Idaho or any company classified as a
32 railroad by the interstate commerce commission and entitled to possess such
33 railroad cars and locomotives except those possessed solely for the purpose of
34 repair, rehabilitation or remanufacturing of such locomotives or railroad
35 cars.
36 (16) "Public utility" means electrical companies, pipeline companies, nat-
37 ural gas distribution companies, or power producers included within federal
38 law, bargelines, and water companies which are under the jurisdiction of the
39 Idaho public utilities commission. The term also includes telephone corpora-
40 tions telecommunications carriers, as that term is defined in section
41 62-6031403(19), Idaho Code, except as hereinafter provided, whether or not
42 such telephone corporation has been issued a certificate of convenience and
43 necessity by the Idaho public utilities commission.
44 This term does not include cogenerators, cable television companies,
45 mobile telephone service or companies, nor does it include pager service or
46 companies, except when such services are an integral part of services provided
47 by a certificated utility company nor does the term "public utility" include
48 companies or persons engaged in the business of providing solely on a resale
49 basis, any telephone or telecommunication service which is purchased from a
50 telephone corporation or company.
51 (17) "Railroad" means every kind of railway, whether its line of rails or
52 tracks be at, above or below the surface of the earth, and without regard to
53 the kind of power used in moving its rolling stock, and shall be considered to
54 include every kind of street railway, suburban railway or interurban railway
55 excepting facilities established solely for maintenance and rebuilding of
17
1 railroad cars or locomotives.
2 (18) "Real property" means land, and all standing timber thereon, includ-
3 ing standing timber owned separately from the ownership of the land upon
4 which the same may stand, except as modified in chapter 17, title 63, Idaho
5 Code, and all buildings, structures and improvements, or other fixtures of
6 whatsoever kind on land, including water ditches constructed for mining, manu-
7 facturing or irrigation purposes, water and gas mains, wagon and turnpike toll
8 roads, and toll bridges, and all rights and privileges thereto belonging, or
9 any way appertaining, all quarries and fossils in and under the land, and all
10 other property which the law defines, or the courts may interpret, declare and
11 hold to be real property under the letter, spirit, intent and meaning of the
12 law, for the purposes of property taxation. Manufactured homes constitute real
13 property when located on taxable land, and after a statement of intent to
14 declare as real property has been recorded, provided said statement has not
15 been revoked. Timber, forest, forest land, and forest products shall be
16 defined as provided in chapter 17, title 63, Idaho Code.
17 (19) "Record owner" means the person or persons in whose name or names the
18 property stands upon the records of the county recorder's office. Where the
19 record owners are husband and wife at the time of notice of pending issue of
20 tax deed, notice to one (1) shall be deemed and imputed as notice to the other
21 spouse.
22 (20) "Special assessment" means a charge imposed upon property for a spe-
23 cific purpose, collected and enforced in the same manner as property taxes.
24 (21) "System value" means the market value for assessment purposes of the
25 operating property when considered as a unit.
26 (22) "Tax code area" means a geographical area made up of one (1) or more
27 taxing districts with one (1) total levy within the geographic area, except as
28 otherwise provided by law.
29 (23) "Taxing district" means any entity or unit with the statutory author-
30 ity to levy a property tax.
31 (24) "Taxable value" means market value for assessment purposes, less
32 applicable exemptions or other statutory provisions.
33 (25) "Transient personal property" is personal property, specifically such
34 construction, logging or mining machinery and equipment which is kept, moved,
35 transported, shipped, hauled into or remaining for periods of not less than
36 thirty (30) days, in more than one (1) county in the state during the same
37 year.
38 (26) "Warrant of distraint" means a warrant ordering the seizure of per-
39 sonal property to enforce payment of property tax, special assessment,
40 expense, fee, collection cost or charge collected in the same manner as per-
41 sonal property tax.
42 SECTION 13. That Section 63-3027, Idaho Code, be, and the same is hereby
43 amended to read as follows:
44 63-3027. COMPUTING IDAHO TAXABLE INCOME OF MULTISTATE OR UNITARY CORPORA-
45 TIONS. The Idaho taxable income of any multistate or unitary corporation
46 transacting business both within and without this state shall be computed in
47 accordance with the rules set forth in this section:
48 (a) As used in this section, unless the context otherwise requires:
49 (1) "Business income" means income arising from transactions and activity
50 in the regular course of the taxpayer's trade or business and includes
51 income from the acquisition, management, or disposition of tangible and
52 intangible property when such acquisition, management, or disposition con-
53 stitutes integral or necessary parts of the taxpayer's trade or business
18
1 operations. Gains or losses and dividend and interest income from stock
2 and securities of any foreign or domestic corporation shall be presumed to
3 be income from intangible property, the acquisition, management, or dispo-
4 sition of which constitutes an integral part of the taxpayer's trade or
5 business; such presumption may only be overcome by clear and convincing
6 evidence to the contrary.
7 (2) "Commercial domicile" means the principal place from which the trade
8 or business of the taxpayer is directed or managed.
9 (3) "Compensation" means wages, salaries, commissions and any other form
10 of remuneration paid to employees for personal services.
11 (4) "Nonbusiness income" means all income other than business income.
12 (5) "Sales" means all gross receipts of the taxpayer not allocated under
13 subsections (d) through (h) of this section.
14 (6) "State" means any state of the United States, the District of Colum-
15 bia, the Commonwealth of Puerto Rico, any territory or possession of the
16 United States, and any foreign country or political subdivision thereof.
17 (b) Any taxpayer having income from business activity which is taxable
18 both within and without this state shall allocate and apportion such net
19 income as provided in this section.
20 (c) For purposes of allocation and apportionment of income under this
21 section, a taxpayer is taxable in another state if:
22 (1) In that state he is subject to a net income tax, a franchise tax mea-
23 sured by net income, a franchise tax for the privilege of doing business,
24 or a corporate stock tax; or
25 (2) That state has jurisdiction to subject the taxpayer to a net income
26 tax regardless of whether, in fact, the state does or does not.
27 (d) Rents and royalties from real or tangible personal property, capital
28 gains interest, dividends, or patent or copyright royalties, to the extent
29 that they constitute nonbusiness income, shall be allocated as provided in
30 subsections (e) through (h) of this section. Allocable nonbusiness income
31 shall be limited to the total nonbusiness income received which is in excess
32 of any related expenses which have been allowed as a deduction during the tax-
33 able year. In the case of allocable nonbusiness interest or dividends, related
34 expenses include interest on indebtedness incurred or continued to purchase or
35 carry assets on which the interest or dividends are nonbusiness income.
36 (e) (1) Net rents and royalties from real property located in this state
37 are allocable to this state.
38 (2) Net rents and royalties from tangible personal property are allocable
39 to this state:
40 (i) iIf and to the extent that the property is utilized in this
41 state,; or
42 (ii) iIn their entirety if the taxpayer's commercial domicile is in
43 this state and the taxpayer is not organized under the laws of or
44 taxable in the state in which the property is utilized.
45 (3) The extent of utilization of tangible personal property in a state is
46 determined by multiplying the rents and royalties by a fraction, the
47 numerator of which is the number of days of physical location of the prop-
48 erty in the state during the rental or royalty period in the taxable year
49 and the denominator of which is the number of days of physical location of
50 the property everywhere during all rental or royalty periods in the tax-
51 able year. If the physical location of the property during the rental or
52 royalty period is unknown or unascertainable by the taxpayer, tangible
53 personal property is utilized in the state in which the property was
54 located at the time the rental or royalty payer obtained possession.
55 (f) (1) Capital gains and losses from sales of real property located in
19
1 this state are allocable to this state.
2 (2) Capital gains and losses from sales of tangible personal property are
3 allocable to this state if:
4 (i) tThe property had a situs in this state at the time of the
5 sale,; or
6 (ii) tThe taxpayer's commercial domicile is in this state and the
7 taxpayer is not taxable in the state in which the property had a
8 situs.
9 (3) Capital gains and losses from sales of intangible personal property
10 are allocable to this state if the taxpayer's commercial domicile is in
11 this state, unless such gains and losses constitute business income as
12 defined in this section.
13 (g) Interest and dividends are allocable to this state if the taxpayer's
14 commercial domicile is in this state unless such interest or dividends consti-
15 tute business income as defined in this section.
16 (h) (1) Patent and copyright royalties are allocable to this state:
17 (i) iIf and to the extent that the patent or copyright is utilized
18 by the payer in this state,; or
19 (ii) iIf and to the extent that the patent or copyright is utilized
20 by the payer in a state in which the taxpayer is not taxable and the
21 taxpayer's commercial domicile is in this state.
22 (2) A patent is utilized in a state to the extent that it is employed in
23 production, fabrication, manufacturing, or other processing in the state
24 or to the extent that a patent product is produced in the state. If the
25 basis of receipts from patent royalties does not permit allocation to
26 states or if the accounting procedures do not reflect states of utiliza-
27 tion, the patent is utilized in the state in which the taxpayer's commer-
28 cial domicile is located.
29 (3) A copyright is utilized in a state to the extent that printing or
30 other publication originates in the state. If the basis of receipts from
31 copyright royalties does not permit allocation to states or if the
32 accounting procedures do not reflect states of utilization, the copyright
33 is utilized in the state in which the taxpayer's commercial domicile is
34 located.
35 (i) (1) Notwithstanding the election allowed in Aarticle III.1 of the
36 multistate tax compact enacted as section 63-3701, Idaho Code, all busi-
37 ness income shall be apportioned to this state under subsection (j) of
38 this section by multiplying the income by a fraction, the numerator of
39 which is the property factor plus the payroll factor plus two (2) times
40 the sales factor, and the denominator of which is four (4), except as pro-
41 vided in paragraph (2) of this subsection.
42 (2) If a corporation, or a parent corporation of a combined group filing
43 a combined report under sections 63-3027 and 63-3701, Idaho Code, is an
44 electrical corporation as defined in section 61-119, Idaho Code, or is a
45 telephone corporation telecommunications carrier as defined in section
46 62-6031403(19), Idaho Code, all business income of the corporation tele-
47 communications carrier shall be apportioned to this state by multiplying
48 the income by a fraction, the numerator of which is the property factor
49 plus the payroll factor plus the sales factor, and the denominator of
50 which is three (3).
51 (j) (1) In the case of a corporation or group of corporations combined
52 under subsection (t) of this section, Idaho taxable income or loss of the
53 corporation or combined group shall be determined as follows:
54 (i) fFrom the income or loss of the corporation or combined group
55 of corporations, subtract any nonbusiness income, and add any
20
1 nonbusiness loss, included in the total,;
2 (ii) mMultiply the amounts determined under paragraph (1)(i) of this
3 subsection by the Idaho apportionment percentage defined in subsec-
4 tion (i) of this section, taking into account, where applicable, the
5 property, payroll and sales of all corporations, wherever incorpo-
6 rated, which are included in the combined group. The resulting prod-
7 uct shall be the amount of business income or loss apportioned to
8 Idaho.
9 (2) To the amount determined as apportioned business income or loss under
10 paragraph (1)(ii) of this subsection, add nonbusiness income allocable
11 entirely to Idaho under the provisions of this section or subtract
12 nonbusiness loss allocable entirely to Idaho under this section. The
13 resulting sum is the Idaho taxable income or loss of the corporation.
14 (3) In the case of a corporation not subject to subsection (t) of this
15 section, the income or loss referred to in paragraph (1)(i) of this sub-
16 section, shall be the taxable income of the corporation after making
17 appropriate adjustments under the provisions of section 63-3022, Idaho
18 Code.
19 (k) The property factor is a fraction, the numerator of which is the
20 average value of the taxpayer's real and tangible personal property owned or
21 rented and used in this state during the tax period and the denominator of
22 which is the average value of all the taxpayer's real and tangible personal
23 property owned or rented and used during the tax period.
24 (l) Property owned by the taxpayer is valued at its original cost. Prop-
25 erty rented by the taxpayer is valued at eight (8) times the net annual rental
26 rate. Net annual rental rate is the annual rental rate paid by the taxpayer
27 less any annual rental rate received by the taxpayer from subrentals.
28 (m) The average value of property shall be determined by averaging the
29 values at the beginning and ending of the tax period, but the state tax com-
30 mission may require the averaging of monthly values during the tax period if
31 reasonably required to reflect properly the average value of the taxpayer's
32 property.
33 (n) The payroll factor is a fraction, the numerator of which is the total
34 amount paid in this state during the tax period by the taxpayer for compensa-
35 tion, and the denominator of which is the total compensation paid everywhere
36 during the tax period.
37 (o) Compensation is paid in this state if:
38 (1) The individual's service is performed entirely within the state; or
39 (2) The individual's service is performed both within and without the
40 state, but the service performed without the state is incidental to the
41 individual's service within the state; or
42 (3) Some of the service is performed in the state and:
43 (i) tThe base of operations or, if there is no base of operations,
44 the place from which the service is directed or controlled is in the
45 state,; or
46 (ii) tThe base of operations or the place from which the service is
47 directed or controlled is not in any state in which some part of the
48 service is performed, but the individual's residence is in this
49 state.
50 (p) The sales factor is a fraction, the numerator of which is the total
51 sales of the taxpayer in this state during the tax period, and the denominator
52 of which is the total sales of the taxpayer everywhere during the tax period.
53 (q) Sales of tangible personal property are in this state if:
54 (1) The property is delivered or shipped to a purchaser, other than the
55 United States government, within this state regardless of the f.o.b. point
21
1 or other conditions of the sale,; or
2 (2) The property is shipped from an office, store, warehouse, factory, or
3 other place of storage in this state and:
4 (i) tThe purchaser is the United States government; or
5 (ii) tThe taxpayer is not taxable in the state of the purchaser.
6 (r) Sales, other than sales of tangible property, are in this state, if:
7 (1) The income-producing activity is performed in this state; or
8 (2) The income-producing activity is performed both in and outside this
9 state and a greater proportion of the income-producing activity is per-
10 formed in this state than in any other state, based on costs of perfor-
11 mance.
12 (s) If the allocation and apportionment provisions of this section do not
13 fairly represent the extent of the taxpayer's business activity in this state,
14 the taxpayer may petition for or the state tax commission may require, in
15 respect to all or any part of the taxpayer's business activity, if reasonable:
16 (1) Separate accounting, provided that only that portion of general
17 expenses clearly identifiable with Idaho business operations shall be
18 allowed as a deduction;
19 (2) The exclusion of any one (1) or more of the factors;
20 (3) The inclusion of one (1) or more additional factors which will fairly
21 represent the taxpayer's business activity in this state; or
22 (4) The employment of any other method to effectuate an equitable alloca-
23 tion and apportionment of the taxpayer's income.
24 (t) For purposes of this section and sections 63-3027B through 63-3027E,
25 Idaho Code, the income of two (2) or more corporations, wherever incorporated,
26 the voting stock of which is more than fifty percent (50%) owned directly or
27 indirectly by a common owner or owners, when necessary to accurately reflect
28 income, shall be allocated or apportioned as if the group of corporations were
29 a single corporation, in which event:
30 (1) The Idaho taxable income of any corporation subject to taxation in
31 this state shall be determined by use of a combined report which includes
32 the income, determined under subparagraph (2) of this subsection, of all
33 corporations which are members of a unitary business, allocated and appor-
34 tioned using apportionment factors for all corporations included in the
35 combined report and methods set out in this section. The use of a combined
36 report does not disregard the separate corporate identities of the members
37 of the unitary group. Each corporation which is transacting business in
38 this state is responsible for its apportioned share of the combined busi-
39 ness income plus its nonbusiness income or loss allocated to Idaho, minus
40 its net operating loss carryover or carryback.
41 (2) The income of a corporation to be included in a combined report shall
42 be determined as follows:
43 (i) fFor a corporation incorporated in the United States or
44 included in a consolidated federal corporation income tax return, the
45 income to be included in the combined report shall be the taxable
46 income for the corporation after making appropriate adjustments under
47 the provisions of section 63-3022, Idaho Code;
48 (ii) fFor a corporation incorporated outside the United States, but
49 not included in subsection (t)(2)(i) of this section, the income to
50 be included in the combined report shall be the net income before
51 income taxes of such corporation stated on the profit and loss state-
52 ments of such corporation which are included within the consolidated
53 profit and loss statement prepared for the group of related corpora-
54 tions of which the corporation is a member, which statement is pre-
55 pared for filing with the United States securities and exchange com-
22
1 mission. If the group of related companies is not required to file
2 such profit and loss statement with the United States securities and
3 exchange commission, the profit and loss statement prepared for
4 reporting to shareholders and subject to review by an independent
5 auditor may be used to obtain net income before income taxes. In the
6 alternative, and subject to reasonable substantiation and consistent
7 application by the group of related companies, adjustments may be
8 made to the profit and loss statements of the corporation incorpo-
9 rated outside the United States, if necessary, to conform such state-
10 ments to tax accounting standards as required by the Internal Revenue
11 Code as if such corporation were incorporated in the United States
12 and required to file a federal income tax return, subject to appro-
13 priate adjustments under the provisions of section 63-3022, Idaho
14 Code; and
15 (iii) iIf the income computation for a group under paragraphs (i) and
16 (ii) of this subsection results in a loss, such loss shall be taken
17 into account in other years, subject to the provisions of subsections
18 (b) and (c) of section 63-3022, Idaho Code.
19 (u) If compensation is paid in the form of a reasonable cash fee for the
20 performance of management services directly for the United States government
21 at the Idaho national engineering laboratory, separate accounting for that
22 part of the business activity without regard to other activity of the taxpayer
23 in the state of Idaho or elsewhere shall be required; provided that only that
24 portion of general expenses clearly identifiable with Idaho business opera-
25 tions of that activity shall be allowed as a deduction.
STATEMENT OF PURPOSE
RS 16142
This legislation would update and recodify Idaho
telecommunications law. Much of the law that still governs
telephone services was enacted originally in 1913. It has been
updated through piecemeal legislation several times since then,
with significant revisions in 1988 and 2005. Not only do the
statutes not fit together very well (which leads to significant
difficulty and confusion in discerning what the law actually
means in many cases) but they have not kept pace with the rapid
technological changes we have experienced. This legislation is
meant to "catch the law up" with the telecommunications
marketplace.
FISCAL NOTE
This legislation will have no impact on the general fund. It
will change the mechanism through which the Universal Service
Fund is funded and will change the criteria for obtaining
support from that fund.
Contact
Name: Ken McClure
Phone: 388-1200
STATEMENT OF PURPOSE/FISCAL NOTE H 741