HP1060, LD 1479, item 1, An Act To Clarify Telecommunications Regulation Reform

An Act To Clarify Telecommunications Regulation Reform

Be it enacted by the People of the State of Maine as follows:

Sec. 1. 35-A MRSA §116, sub-§1, as amended by PL 2011, c. 623, Pt. B, §1, is further amended to read:

1. Entities subject to assessments. Every transmission and distribution, gas, telephone and water utility and ferry subject to regulation by the commission and every qualified telecommunications provider is subject to an assessment on its intrastate gross operating revenues to produce sufficient revenue for expenditures allocated by the Legislature for the Public Utilities Commission Regulatory Fund established pursuant to this section. The budget for the Public Utilities Commission Regulatory Fund is subject to legislative review and approval in accordance with subsection 2. The portion of the total assessment applicable to each category of public utility or qualified telecommunications provider is based on an accounting by the commission of the portion of the commission's resources devoted to matters related to each category. The commission shall develop a reasonable and practicable method of accounting for resources devoted by the commission to matters related to each category of public utility or qualified telecommunications provider. Assessments on each public utility or qualified telecommunications provider within each category must be based on the utility's or qualified telecommunications provider's gross intrastate operating revenues. The commission shall determine the assessments annually prior to May 1st and assess each utility or qualified telecommunications provider for its pro rata share for expenditure during the fiscal year beginning July 1st. Each utility or qualified telecommunications provider shall pay the assessment charged to the utility or qualified telecommunications provider on or before July 1st of each year. Any increase in the assessment that becomes effective subsequent to May 1st may be billed on the effective date of the act authorizing the increase.

A. The assessments charged to utilities and qualified telecommunications providers under this section are just and reasonable operating costs for rate-making purposes.

B. For the purposes of this section, "intrastate gross operating revenues" means intrastate revenues derived from filed rates and rates charged by a qualified telecommunications provider, except revenues derived from sales for resale. :

(1) In the case of all utilities except telephone utilities, revenues derived from filed rates;

(2) In the case of a telephone utility, all intrastate revenues, whether or not such rates are required to be filed pursuant to this Title; and

(3) In the case of a qualified telecommunications provider, all intrastate revenues except revenues derived from sale or resale.

C. Gas utilities subject to the jurisdiction of the commission solely with respect to safety are not subject to any assessment.

D. The commission may correct any errors in the assessments by means of a credit or debit to the following year's assessment rather than reassessing all utilities or qualified telecommunications providers in the current year.

E. The commission may exempt utilities or qualified telecommunications providers with annual intrastate gross operating revenues under $50,000 from assessments under this section.

For purposes of this section, "qualified telecommunications provider" means a provider of person that provides interconnected voice over Internet protocol service that paid any assessment under this subsection, whether voluntarily, by agreement with the commission or otherwise, prior to March 1, 2012 over facilities that it, or an affiliated company, owns or leases.

Sec. 2. 35-A MRSA §7104, sub-§3, ¶D, as amended by PL 2011, c. 623, Pt. B, §14, is further amended to read:

D. Ensure that any requirements regarding contributions to a state universal service fund be are nondiscriminatory and competitively neutral; and

Sec. 3. 35-A MRSA §7104, sub-§3, ¶G, as enacted by PL 2011, c. 623, Pt. B, §14, is amended to read:

G. Require, if a voice network service provider recovers its contributions under this section by means of a charge placed on a bill issued to a customer, explicit identification on that bill of any charge imposed under this section . ; and

Sec. 4. 35-A MRSA §7104, sub-§3, ¶H is enacted to read:

H. Ensure that the total amount distributed for support to providers of provider of last resort service does not exceed $7,500,000.

Sec. 5. 35-A MRSA §7104, sub-§9 is enacted to read:

9. Increase of universal service fund support. If the commission determines through an expedited emergency rate case under section 7222, subsection 3 or an investigation into a general increase in rates under chapter 3 that a provider of provider of last resort service requires support greater than the amounts permitted under subsection 3, paragraph H, the commission shall submit a report regarding the amount needed to the joint standing committee of the Legislature having jurisdiction over energy, utilities and technology matters. The joint standing committee of the Legislature having jurisdiction over energy, utilities and technology matters may submit legislation based on the report.

Sec. 6. 35-A MRSA §7221, sub-§2, ¶A is enacted to read:

A. The commission may not assign the provider of last resort service obligation for a given geographic area to another voice service provider without the consent of the service provider unless the commission finds through an investigation that the service provider is unable to provide provider of last resort service in accordance with this chapter.

Sec. 7. 35-A MRSA §7222, as enacted by PL 2011, c. 623, Pt. A, §18, is amended to read:

§ 7222. Revenue requirements of service providers

The initial rates for provider of last resort service are those rates in effect for basic local exchange service for each incumbent local exchange carrier in the service area of that carrier as of January 1, 2012.

1. Change in rates. A service provider may file for a rate increase in accordance with chapter 3.

2. Establishment of rates; requirements. In addition to the requirements of chapter 3, when establishing the revenue requirements for a service provider and the rates for provider of last resort service, the commission shall ensure that the rates for provider of last resort service are:

A. Uniform throughout the State for that service provider;

B. At the time the rate is set by the commission, within 2 standard deviations of the national average price for voice service as determined by the Federal Communications Commission; and

C. Not set at a level that will jeopardize the receipt of federal funds to support telecommunications services.

3. Emergency rate case. A service provider may petition the commission for expedited approval of an emergency rate increase in accordance with this subsection.

A. The service provider must provide the following information to the commission when submitting the petition:

(1) An annual report for the test year;

(2) Expenses, revenues and rate base during the test year, itemized by account number or functional grouping;

(3) Uncollectible revenues for the test year, including bad debt expenses, gross write-offs and recoveries of prior write-offs;

(4) The number of units of service billed for each rate element of service;

(5) Local service revenues, all toll service revenues and miscellaneous revenues for the test year;

(6) A statement of the service provider's revenue requirement for the test year; and

(7) A proposed schedule of provider of last resort service rates that meet the requirements of subsection 2.

For the purposes of this paragraph, "test year" means the most recent complete calendar year.

B. The commission may approve an emergency rate increase if the commission determines that the revenue requirement pursuant to paragraph A, subparagraph (6) is reasonably likely to be equal to or less than the revenue requirement that would be identified through a full investigation under section 310. The commission shall complete the emergency rate case within 60 days of the submission of the petition under paragraph A.

C. The commission may determine that immediately raising the rates of a service provider is not in the public interest and may establish a method to incrementally collect the amount of the emergency rate increase over an extended period of time.

D. The emergency rate increase expires 3 months after the completion of the emergency rate case unless the service provider files a schedule for a general rate increase under chapter 3. If the service provider files a schedule for a general increase in rates under chapter 3 within 3 months after the completion of the emergency rate case, the emergency rate increase expires upon the completion of any investigation initiated by the commission in response to that filing.

E. If the commission determines after an investigation in response to a general rate increase filing under chapter 3 that the service provider's revenue requirement is less than the revenue requirement approved through the emergency rate case, any excess revenue must be returned to the service provider's ratepayers in the form of a bill credit.

F. If the commission determines after an investigation in response to a general rate increase filing under chapter 3 that the service provider's revenue requirement is greater than the revenue requirement approved through the emergency rate case, the provider may not recover the difference in future provider of last resort service rates.

SUMMARY

This bill limits the amount of funds a provider of provider of last resort service can receive from the state universal service fund. The bill establishes a procedure for the Public Utilities Commission to conduct an emergency rate case in response to a petition for a temporary increase in rates.

This bill provides that the Public Utilities Commission may not reassign the provider of last resort service obligation without the consent of the current service provider unless that provider is unable to provide the service in accordance with state law. This bill provides that the rate charged to customers for provider of last resort service must be uniform throughout the State for a service provider, must be within 2 standard deviations of the national average and may not be set at a level that will jeopardize the receipt of federal funding to support telecommunications services.

This bill amends the section of law related to the assessment to fund the Public Utilities Commission and the Office of the Public Advocate to include all utilities that were included prior to the enactment of Public Law 2011, chapter 623. It expands the assessment to include a person that provides voice over Internet protocol service over facilities that it, or an affiliated company, owns or leases, regardless of whether that service provider paid the assessment prior to March 1, 2012.

This bill is reported out by the Joint Standing Committee on Energy, Utilities and Technology pursuant to Public Law 2011, chapter 623, Part A, section 25 and Part D, section 7. As required by the public law, the Public Utilities Commission submitted to the committee a report to create a framework for establishing rates for provider of last resort service and a report regarding assessments paid by voice service providers on January 15, 2013.

The Joint Standing Committee on Energy, Utilities and Technology has not taken a position on the substance of this bill and by reporting this bill out the committee is not suggesting and does not intend to suggest that it agrees or disagrees with any aspect of this bill. The committee is reporting the bill out for the sole purpose of turning the issues raised in the Public Utilities Commission's reports into a printed bill that can be referred to the committee for an appropriate public hearing and subsequent processing in the normal course. The committee is taking this action to ensure clarity and transparency in the legislative review of the framework for setting the rates for provider of last resort service.

HP1060 LD 1479	Session - 126th Maine Legislature		LR 2107 Item 1
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