(Corrected)
As Amended by Senate Committee
Session of 1999
SENATE BILL No. 290
By Senators Brownlee, Jordan, Ranson and Steineger
2-10
11 AN ACT
concerning telecommunications; relating to rate rebalancing
12 and access to the
Kansas universal service fund; amending K.S.A. 1998
13 Supp. 66-1,187,
66-2001, 66-2002, 66-2003, 66-2005, 66-2008 and 66-
14 2009 and repealing the
existing sections; also repealing K.S.A. 1998
15 Supp. 66-2012
and, 66-2013 and
66-2016.
16
17 Be it enacted by the Legislature of the
State of Kansas:
18 Section
1. K.S.A. 1998 Supp. 66-1,187 is hereby amended to read as
19 follows: 66-1,187. As used in this act:
20 (a) "Broadband"
means the transmission of digital signals at rates
21 equal to or greater than 1.5 megabits per
second.
22 (b) "CLASS
services" means custom local area signaling services,
23 which include automatic callback, automatic
recall, calling number iden-
24 tification, selective call rejection,
selective call acceptance, selective call
25 forwarding, distinctive ringing and
customer originated trace.
26 (c) "Commission"
means the state corporation commission.
27 (d) "Dialing
parity" means that a person that is not an affiliate of a
28 local exchange carrier is able to provide
telecommunications services in
29 such a manner that customers have the
ability to route automatically,
30 without the use of any access code, their
telecommunications to the tel-
31 ecommunications carrier of the customer's
designation from among two
32 or more telecommunications carriers,
including such local exchange
33 carrier.
34 (e) "Federal act"
means the federal telecommunications act of 1996,
35 P.L. 104-104 (amending the communications
act of 1934, 47 U.S.C. 151,
36 et seq.)
37 (f) "ISDN" means
integrated services digital network which is a net-
38 work and associated technology that
provides simultaneous voice and data
39 communications over a single communications
channel.
40 (g) "LATA" has
the meaning ascribed to it in the federal act.
41 (h) "Local
exchange carrier" means any telecommunications public
42 utility or its successor providing switched
telecommunications service
43 within any local exchange service area, as
approved by the commission
44 on or before January 1, 1996.
However, with respect to the Hill City
45 exchange area, in which multiple
carriers were certified by the commis-
46 sion prior to January 1, 1996, the
commission's determination, subject to
47 any court appeals, of which
authorized carrier shall serve as the carrier
48 of last resort will determine which
carrier shall be deemed the local
49 exchange carrier for that
exchange.
50 (i) "Number
portability" has the meaning ascribed to it in the federal
51 act.
52 (j) "1 +
intraLATA dialing parity" means the ability of a local exchange
53 service customer to specify the
telecommunications or local exchange
54 carrier that will carry the intraLATA long
distance messages when that
55 customer dials either "1" or "0" plus a
10-digit number.
56 (k) "Operating
area" means:
57 (1) In the case
of a rural telephone company, operating area or service
58 area means such company's study area or
areas as approved by the federal
59 communications commission;
60 (2) in the case
of a local exchange carrier, other than a rural telephone
61 company, operating area or service area
means such carrier's local
62 exchange service area or areas as approved
by the commission.
63 (l) "Rural
telephone company" has the meaning ascribed to it in the
64 federal act, excluding any local exchange
carrier which together with all
65 of its affiliates has 20,000 or more access
lines in the state.
66
(m) "Telecommunications carrier" means a corporation,
company,
67 individual, association of persons, their
trustees, lessees or receivers that
68 provides a telecommunications service,
including, but not limited to, in-
69 terexchange carriers and competitive access
providers, but not including
70 local exchange carriers certified before
January 1, 1996.
71
(n) "Telecommunications public utility" means any public
utility, as
72 defined in K.S.A. 66-104, and amendments
thereto, which owns, controls,
73 operates or manages any equipment, plant or
generating machinery, or
74 any part thereof, for the transmission of
telephone messages, as defined
75 in K.S.A. 66-104, and amendments thereto,
or the provision of telecom-
76 munications services in or throughout any
part of Kansas.
77
(o) "Telecommunications service" means the provision of a
service
78 for the transmission of telephone messages,
or two-way video or data
79 messages.
80 (p) "Universal
service" means telecommunications services and fa-
81 cilities which include: single party,
two-way voice grade calling; stored
82 program controlled switching with vertical
service capability; E911 ca-
83 pability; tone dialing; access to operator
services; access to directory as-
84 sistance; and equal access
to long distance services; and toll blocking or
85 toll control.
86 (q) "Enhanced
universal service" means telecommunications
serv-
87 ices, in addition to those included
in universal service, which shall include:
88 Signaling system seven capability,
with CLASS service capability; basic
89 and primary rate ISDN capability,
or the technological equivalent; full-
90 fiber interconnectivity, or the
technological equivalent, between central
91 offices; and broadband capable
facilities to: All schools accredited pur-
92 suant to K.S.A. 72-1101
et seq., and amendments thereto;
hospitals as
93 defined in K.S.A. 65-425, and
amendments thereto; public libraries; and
94 state and local government
facilities which request broadband services,
95 without regard to any
transmission, media or technology,
high-speed,
96 switched, broadband telecommunications
capability that enables users to
97 originate and receive high-quality
voice, data, graphics and video tele-
98 communications using any
technology.
99 Sec.
2. K.S.A. 1998 Supp. 66-2001 is hereby amended to read as
100 follows: 66-2001. It is hereby declared to
be the public policy of the state
101 to:
102 (a) Ensure that
every Kansan will have access to a first class telecom-
103 munications infrastructure that provides
excellent services at an afforda-
104 ble price;
105 (b) ensure
that conditions exist for consumers
throughout the state
106 to realize the benefits of
competition through increased services and im-
107 proved telecommunications facilities and
infrastructure at reduced rea-
108 sonable rates;
109 (c) promote
consumer access to a full range of telecommunications
110 services, including advanced
telecommunications services that are com-
111 parable in urban and rural areas
throughout the state;
112 (d) advance the
development of a statewide telecommunications in-
113 frastructure that is capable of supporting
applications, such as public
114 safety, telemedicine, services for persons
with special needs, distance
115 learning, public library services, access
to internet providers and others;
116 and
117 (e) protect
consumers of telecommunications services from fraudu-
118 lent business practices and practices that
are inconsistent with the public
119 interest, convenience and
necessity.; and
120 (f) foster
conditions for continuous innovation of information net-
121 working and telecommunications.
122 Sec.
3. K.S.A. 1998 Supp. 66-2002 is hereby amended to read as
123 follows: 66-2002. The commission
shall:
124
(a) Adopt a definition of "universal service" and
"enhanced universal
125 service," pursuant to subsections
(p) and (q) of K.S.A. 1998 Supp. 66-
126 1,187;
127 (b)
(a) Authorize any requesting telecommunications carrier
to pro-
128 vide local exchange or exchange access
service pursuant to subsection (a)
129 of K.S.A. 1998 Supp. 66-2003, and
amendments thereto;
130 (c)
(b) on or before July 1, 1996, the commission shall
initiate a pro-
131 ceeding to adopt guidelines to ensure that
all telecommunications carriers
132 and local exchange carriers preserve and
enhance universal service, pro-
133 tect the public safety and welfare, ensure
the continued quality of tele-
134 communications services and safeguard the
rights of consumers;
135
(d) review, approve and ensure compliance with network
infrastruc-
136 ture plans submitted by local
exchange carriers pursuant to K.S.A. 1998
137 Supp. 66-2005;
138 (e)
(c) review, approve and ensure compliance with
regulatory plans
139 submitted by local exchange carriers
pursuant to K.S.A. 1998 Supp. 66-
140 2005, and amendments thereto;
141 (f)
(d) on or before January 1, 1997, establish, pursuant
to K.S.A. 1998
142 Supp. 66-2006, and amendments
thereto, the Kansas lifeline service pro-
143 gram, hereinafter referred to as the
KLSP;
144 (g)
(e) initiate and complete a proceeding by January 1,
1997, to es-
145 tablish a competitively neutral mechanism
or mechanisms to fund: dual
146 party relay services for Kansans who are
speech or hearing impaired;
147 telecommunications equipment for persons
with visual impediments; and
148 telecommunications equipment for persons
with other special needs. This
149 funding mechanism or mechanisms shall be
implemented by March 1,
150 1997;
151 (h)
(f) on or before January 1, 1997, establish the Kansas
universal
152 service fund pursuant to K.S.A. 1998 Supp.
66-2008, and amendments
153 thereto, hereinafter referred to as
the KUSF, and make various deter-
154 minations relating to the implementation
of such fund;
155 (i)
(g) authorize all local exchange carriers to provide
internet access
156 as outlined in K.S.A. 1998 Supp.
66-2011, and amendments thereto, and
157 report on the status of the implementation
provisions to specified legis-
158 lative committees;
159
(j) review the federal act and adopt additional
standards and guide-
160 lines as necessary for enforcing
slamming restrictions;
161 (k)
(h) commencing on June 1, 1997, and periodically
thereafter, re-
162 view and, to the extent necessary,
modify the definition of universal serv-
163 ice and enhanced universal
service, and adjust the
KUSF as
necessary,
164 establish and, to the extent
necessary, modify rules and guidelines
165 to determine what services qualify
as enhanced universal services,
166 pursuant to subsection (q) of K.S.A.
66-1,187 and amendments
167 thereto, taking into account
advances in telecommunications and infor-
168 mation technology and services;
169 (l)
(i) on or before January 1, 1997, initiate and complete
a proceeding
170 to establish minimum quality of service
standards which will be equally
171 applicable to all local exchange carriers
and telecommunications carriers
172 in the state; any local exchange carrier
or telecommunications carrier
173 violating such standards, for each
occurrence, shall forfeit and pay a pen-
174 alty of not less than $100, nor more than
$5,000; violations of such stan-
175 dards shall be enforced in accordance with
provisions of K.S.A. 66-138
176 and 66-177, and amendments thereto;
and
177 (m)
(j) on January 1, 2000, prepare and submit a report to
the leg-
178 islature. The report shall include an
analysis of the manner in which the
179 regulatory framework has served to:
Protect consumers; safeguard uni-
180 versal service; ensure that consumers have
reaped the benefits of com-
181 petition; maximize the use of market
forces; and promote development
182 of the telecommunications infrastructure
throughout the state. The com-
183 mission also shall recommend if and how
the KUSF should be modified.
184 The commission may submit the report by
posting the report's contents
185 on the commission's internet homepage
and notifying the legislature of
186 the report's availability.
187 Sec.
4. K.S.A. 1998 Supp. 66-2003 is hereby amended to read as
188 follows: 66-2003. (a) On or before
September 1, 1996, the commission
189 shall begin to authorize applications for
certificates of public convenience
190 and necessity to provide local exchange or
exchange access service.
191 (b) A local
exchange carrier shall be required to offer to allow rea-
192 sonable resale of its retail
telecommunications services and to sell un-
193 bundled local loop, switch and trunk
facilities to telecommunications car-
194 riers, as required by the federal act and
pursuant to negotiated
195 agreements or a statement of terms and
conditions generally available to
196 telecommunications carriers.
197 (c) To encourage
telecommunications carriers to build or install tel-
198 ecommunications facilities, including, but
not limited to, local loop and
199 switching facilities in the state, and
except as otherwise negotiated by a
200 local exchange carrier and a
telecommunications carrier, the prices for
201 such unbundled facilities shall be
determined by the commission, on a
202 nondiscriminatory basis, to permit the
recovery of costs and a reasonable
203 profit. The commission shall determine
wholesale rates on the basis of
204 retail rates charged subscribers for the
telecommunications service re-
205 quested, excluding the portion thereof
attributable to any marketing, bill-
206 ing, collection and other costs, that will
be avoided by the local exchange
207 carrier. The commission shall approve
resale restrictions proposed by any
208 local exchange carrier which prohibit
resellers from purchasing retail tel-
209 ecommunications services offered by that
local exchange carrier to one
210 category of customers and reselling those
retail services to a different
211 category of customers. Upon a finding that
such practice would be anti-
212 competitive, anticonsumer or detrimental
to the quality of the network
213 infrastructure, the commission may
prohibit the resale of retail services
214 at a rate lower than the wholesale rate.
The commission shall approve any
215 other reasonable limitation on resale to
the extent permitted by the fed-
216 eral act.
217 (d) As provided
in the federal act, in order for telecommunications
218 carriers to provide local exchange service
and exchange access service,
219 local exchange carriers shall provide the
means to interconnect their re-
220 spective customers, including, but not
limited to, toll access, access to
221 operator services, access to directory
listings and assistance, and access to
222 E911 service.
223 (e) Customers
shall be accorded number portability and local and toll
224 dialing parity in conformance with
national standards to the extent eco-
225 nomically and technically
feasible the federal act and federal communi-
226 cation commission rules and
regulations. Terms and prices for intercon-
227 nection, unbundled facilities and resale
of existing retail
228 telecommunications services shall be
negotiated in good faith between
229 the parties. During the period from the
135th through the 160th day after
230 the date on which an incumbent local
exchange carrier receives a request
231 for negotiation under this section, the
carrier or any other party to the
232 negotiation may petition the commission to
arbitrate any open issues.
233 Arbitration shall occur in conformance
with the provisions of section 252
234 of the federal act.
235 (f) The
commission shall require, consistent with the terms of
the
236 federal act, that 1 + intraLATA
dialing parity be provided by all local
237 exchange carriers and
telecommunications carriers coincidentally with the
238 provision of in-region interLATA
toll services in the state by local
239 exchange carriers with more than
150,000 access lines or their affiliates.
240 Sec.
5. K.S.A. 1998 Supp. 66-2005 is hereby amended to read as
241 follows: 66-2005. (a) Each local
exchange carrier shall file a network in-
242 frastructure plan with the
commission on or after January 1, 1997, and
243 prior to January 1, 1998. Each
plan, as a part of universal service protec-
244 tion, shall include schedules,
which shall be approved by the commission,
245 for deployment of universal
service capabilities by July 1, 1998, and the
246 deployment of enhanced universal
service capabilities by July 1, 2003, as
247 defined pursuant to subsections
(p) and (q) of K.S.A. 1998 Supp. 66-1,187
248 and amendments thereto,
respectively. With respect to enhanced univer-
249 sal service, such schedules shall
provide for deployment of ISDN, or its
250 technological equivalent, or
broadband facilities, only upon a firm cus-
251 tomer order for such service, or
for deployment of other enhanced uni-
252 versal services by a local
exchange carrier. After receipt of such an order
253 and upon completion of a
deployment plan designed to meet the firm
254 order or otherwise provide for the
deployment of enhanced universal
255 service, a local exchange carrier
shall notify the commission. The com-
256 mission shall approve the plan
unless the commission determines that the
257 proposed deployment plan is
unnecessary, inappropriate, or not cost ef-
258 fective, or would create an
unreasonable or excessive demand on the
259 KUSF. The commission shall take
action within 90 days. If the commis-
260 sion fails to take action within
90 days, the deployment plan shall be
261 deemed approved. This approval
process shall continue until July 1, 2000.
262 Each plan shall demonstrate the
capability of the local exchange carrier
263 to comply on an ongoing basis with
quality of service standards to be
264 adopted by the commission no later
than January 1, 1997. The commission
265 shall establish rules and
regulations guidelines by June
30, 2000, to ad-
266 dress access to enhanced
telecommunications and information services
267 that are reasonably comparable between
urban and rural areas through-
268 out the state. Such rules shall
establish a method by which telecommu-
269 nications services providers may
request supplemental funding for en-
270 hanced universal services. Those local
exchange carriers that have
271 deployed enhanced universal service
will be eligible for reimbursement
272 from the KUSF pending verification of
the expenditure, the timing of the
273 expenditure and the associated
costs.
274 (b) In order to
protect universal service, facilitate the transition to
275 competitive markets and stimulate the
construction of an advanced tel-
276 ecommunications infrastructure, each local
exchange carrier shall file a
277 regulatory reform plan at the same
time as it files the network infrastruc-
278 ture plan required in subsection
(a). As part of its regulatory reform plan,
279 a local exchange carrier may elect
traditional rate of return regulation or
280 price cap regulation. A company that
has elected price cap regulation
281 may, at its option, rescind the
price cap regulation election at any
282 time. Carriers that elect
price cap regulation shall be exempt from rate
283 base, rate of return and earnings
regulation for the purpose of establishing
284 rates. However, the commission may
resume such regulation upon find-
285 ing, after a hearing, that a carrier that
is subject to price cap regulation
286 has: violated minimum quality of service
standards pursuant to subsection
287 (l) of K.S.A. 1998 Supp. 66-2002 and
amendments thereto; been given
288 reasonable notice and an opportunity to
correct the violation; and failed
289 to do so. Regulatory reform plans
also shall include:
290 (1) A
commitment to All telecommunications public utilities
shall pro-
291 vide existing and newly ordered
point-to-point broadband services to: Any
292 hospital as defined in K.S.A. 65-425, and
amendments thereto; any school
293 accredited pursuant to K.S.A. 72-1101 et
seq., and amendments thereto;
294 any public library; or other state and
local government facilities at dis-
295 counted prices close to, but not below,
long-run incremental cost; and
296 (2) a
commitment to provide basic rate ISDN service, or the
tech-
297 nological equivalent, at prices
which are uniform throughout the carrier's
298 service area. Local exchange
carriers shall not be required to allow retail
299 customers purchasing the foregoing
discounted services to resell those
300 services to other categories of
customers. Telecommunications carriers
301 may purchase basic rate ISDN
services, or the technological equivalent,
302 for resale in accordance with
K.S.A. 1998 Supp. 66-2003 and amendments
303 thereto. The commission may reduce
prices charged for services outlined
304 in provisions (1) and (2) of this
subsection, if the commitments of the
305 local exchange carrier set forth
in those provisions are not being kept.
306 (c) Subject to
the commission's approval, all local exchange carriers
307 shall reduce intrastate access charges to
interstate levels as provided
308 herein. Rates for intrastate switched
access, and the imputed access por-
309 tion of toll, shall be reduced over a
three-year period with the objective
310 of equalizing interstate and intrastate
rates in a revenue neutral, specific
311 and predictable manner. Subsequent
reductions in intrastate access rates
312 may be ordered by the commission in
order to maintain parity with in-
313 terstate access rates and
structure including end-user charges. The
314 commission is authorized to rebalance
local residential and business serv-
315 ice rates to offset the initial
three-year phase in of the intrastate access
316 and toll charge reductions and to
offset any subsequent intrastate access
317 and toll charge reductions, to the
extent justified, based on a cost of service
318 investigation. Any remaining
portion of the initial three-year phase in of
319 the reduction in access and toll charges
not recovered through local res-
320 idential and business service rates shall
be paid out from the KUSF pur-
321 suant to K.S.A. 1998 Supp. 66-2008 and
amendments thereto. Thereafter,
322 any remaining portion of subsequent
intrastate access and toll charge
323 reductions not recovered through local
residential and business service
324 rates shall be paid out from the KUSF,
to the extent justified based upon
325 cost of service studies. Rural
telephone companies shall reduce their in-
326 trastate switched access rates to
interstate levels on March 1, 1997, and
327 every two years thereafter, as long as
amounts equal to such reductions
328 are recovered from the KUSF.
329 (d) Beginning
March 1, 1997, each rural telephone company shall
330 have the authority to increase annually
its monthly basic local residential
331 and business service rates by an amount
not to exceed $1 in each 12
332 month period until such monthly rates
reach an amount equal to the
333 statewide rural telephone company average
rates for such services. The
334 statewide rural telephone company average
rates shall be the arithmetic
335 mean of the lowest flat rate as of March
1, 1996, for local residential
336 service and for local business service
offered by each rural telephone
337 company within the state. In the case of a
rural telephone company which
338 increases its local residential service
rate or its local business service rate,
339 or both, to reach the statewide rural
telephone company average rate for
340 such services, the amount paid to the
company from the KUSF shall be
341 reduced by an amount equal to the
additional revenue received by such
342 company through such rate increase. In the
case of a rural telephone
343 company which elects to maintain a local
residential service rate or a local
344 business service rate, or both, below the
statewide rural telephone com-
345 pany average, the amount paid to the
company from the KUSF shall be
346 reduced by an amount equal to the
difference between the revenue the
347 company could receive if it elected to
increase such rate to the average
348 rate and the revenue received by the
company.
349 (e) For
regulatory reform plans in which price cap regulation has
350 been elected, price cap plans shall have
three baskets: Residential and
351 single-line business, including
touch-tone tone dialing; switched
access
352 services; and miscellaneous services. The
commission shall establish price
353 caps at the prices existing when the
regulatory plan is filed subject to rate
354 rebalancing as provided in subsection (c)
for residential services, includ-
355 ing touch-tone tone
dialing services, and for single-line business
services,
356 including touch-tone
tone dialing services, within the residential and
357 single-line business service basket. The
commission shall establish a for-
358 mula for adjustments to the price caps.
The commission also shall estab-
359 lish price caps at the prices existing
when the regulatory plan is filed for
360 the miscellaneous services basket. The
commission shall approve any ad-
361 justments to the price caps for the
miscellaneous service basket, as pro-
362 vided in subsection (f).
363 (f) On or before
January 1, 1997, the commission shall issue a final
364 order in a proceeding to determine the
price cap adjustment formula that
365 shall apply to the price caps for the
local residential and single-line busi-
366 ness and the miscellaneous services
baskets and for sub-categories, if any,
367 within those baskets. In determining this
formula, the commission shall
368 balance the public policy goals of
encouraging efficiency and promoting
369 investment in a quality, advanced
telecommunications network in the
370 state. The commission also shall establish
any informational filing require-
371 ments necessary for the review of any
price cap tariff filings, including
372 price increases or decreases within the
caps, to verify such caps would
373 not be exceeded by any proposed price
change. The adjustment formula
374 shall apply to the price caps for the
local residential and single-line busi-
375 ness basket after December 31, 1999, and
to the miscellaneous services
376 basket after December 31, 1997. The price
cap formula, but not actual
377 prices, shall be reviewed every five
years.
378 (g) The price
caps for the residential and single-line business service
379 basket shall be capped at their initial
level until January 1, 2000, except
380 for any increases authorized as a part of
the revenue neutral rate rebal-
381 ancing under subsection (c). The price
caps for this basket and for the
382 categories in this basket, if any,
shall may be adjusted annually after
De-
383 cember 31, 1999, based on the formula
determined by the commission
384 under subsection (f).
385 (h) The price
cap for the switched access service basket shall be set
386 based upon the local exchange carrier's
intrastate access tariffs as of Jan-
387 uary 1, 1997, except for any
revenue neutral rate rebalancing authorized
388 in accordance with subsection (c).
Thereafter, the cap for this basket shall
389 not change except in connection
with any subsequent revenue neutral
390 rebalancing authorized by the
commission under subsection (c) may be
391 adjusted annually based on a formula
determined by the commission un-
392 der subsection (f). Additional
adjustments to the price caps may be re-
393 quired due to rebalancing authorized by
the commission under subsection
394 (c).
395 (i) The price
caps for the miscellaneous services basket shall be ad-
396 justed annually after December 31, 1997,
based on the adjustment for-
397 mula determined by the commission under
subsection (f).
398 (j) A price cap
is a maximum price for all services taken as a whole
399 in a given basket. Prices for individual
services may be changed within
400 the service categories, if any,
established by the commission within a
401 basket. An entire service category, if
any, within the residential and single-
402 line business basket or miscellaneous
services basket may be priced below
403 the cap for such category. Unless
otherwise approved by the commission,
404 no service shall be priced below the price
floor which will be long-run
405 incremental cost and imputed access
charges. Access charges equal to
406 those paid by telecommunications carriers
to local exchange carriers shall
407 be imputed as part of the price floor for
toll services offered by local
408 exchange carriers on a toll service
basis.
409 (k) A local
exchange carrier may offer promotions within an exchange
410 or group of exchanges. All promotions
shall be approved by the commis-
411 sion and shall apply to all customers in a
nondiscriminatory manner within
412 the exchange or group of exchanges.
413 (l) Unless the
commission authorizes price deregulation at an earlier
414 date, intrastate toll services within the
miscellaneous services basket shall
415 continue to be regulated until the
affected local exchange carrier begins
416 to offer 1 + intraLATA dialing parity
throughout its service territory, at
417 which time intrastate toll will be price
deregulated, except that prices
418 cannot be set below the price floor.
419 (m) On or before
July 1, 1997, the commission shall establish guide-
420 lines for reducing regulation prior to
price deregulation of price cap reg-
421 ulated services in the miscellaneous
services basket, the switched access
422 services basket, and the residential and
single-line business basket.
423 (n) Subsequent
to the adoption of guidelines pursuant to subsection
424 (m), the commission shall initiate a
petitioning procedure under which
425 the local exchange carrier may request
rate range pricing. The commis-
426 sion shall act upon a petition within 21
days, subject to a 30-day suspen-
427 sion. The prices within a rate range shall
be tariffed and shall apply to all
428 customers in a nondiscriminatory manner in
an exchange or group of
429 exchanges.
430 (o) A local
exchange carrier may petition the commission to designate
431 an individual service or service category,
if any, within the miscellaneous
432 services basket, the switched access
services basket or the residential and
433 single-line business basket for reduced
regulation. The commission shall
434 act upon a petition for reduced regulation
within 21 days, subject to a
435 suspension period of an additional 30
days, and upon a good cause show-
436 ing of the commission in the suspension
order, or within such shorter
437 time as the commission shall approve. The
commission shall issue a final
438 order within the 21-day period or within a
51-day period if a suspension
439 has been issued. Following an order
granting reduced regulation of an
440 individual service or service category,
the commission shall act on any
441 request for price reductions within seven
days subject to a 30-day sus-
442 pension. The commission shall act on other
requests for price cap ad-
443 justments, adjustments within price cap
plans and on new service offer-
444 ings within 21 days subject to a 30-day
suspension. Such a change will be
445 presumed lawful unless it is determined
the prices are below the price
446 floor or that the price cap for a
category, if any, within the entire basket
447 has been exceeded.
448 (p) The
commission may price deregulate within an exchange area,
449 or at its discretion on a statewide basis,
any individual service or service
450 category upon a finding by the commission
that there is a telecommuni-
451 cations carrier or an alternative provider
providing a comparable product
452 or service, considering both function and
price, in that exchange area.
453 The commission shall act upon a petition
for price deregulation within
454 21 days, subject to a suspension period of
an additional 30 days, and upon
455 a good cause showing of the commission in
the suspension order, or
456 within such shorter time as the commission
shall approve; provided that
457 no such petition shall be filed prior to
July 1997, unless the commission
458 otherwise authorizes. The commission shall
issue a final order within the
459 21-day period or within a 51-day period if
a suspension has been issued.
460 (q) Upon
complaint or request, the commission may investigate a
461 price deregulated service. The commission
shall resume price regulation
462 of a service provided in any exchange area
by placing it in the appropriate
463 service basket, as approved by the
commission, upon a determination by
464 the commission that there is no longer a
telecommunications carrier or
465 alternative provider providing a
comparable product or service, consid-
466 ering both function and price, in that
exchange area.
467 (r) The
commission shall require that for all local exchange carriers
468 all such price deregulated basic intraLATA
toll services be geographically
469 averaged statewide and not be priced below
the price floor established
470 in subsection (j).
471 (s) Cost studies
to determine price floors shall be performed as re-
472 quired by the commission in response to
complaints or on the commis-
473 sion's own motion. In addition,
notwithstanding the exemption in sub-
474 section (b), the commission may request
information necessary to execute
475 any of its obligations under the act.
476 (t) A local
exchange carrier may petition for individual customer pric-
477 ing. The commission shall respond
expeditiously to the petition within a
478 period of not more than 30 days subject to
a 30-day suspension.
479 (u) No
audit, earnings review or rate case shall be performed
with
480 reference to the initial prices
filed as required herein The commission is
481 authorized to conduct audits,
investigations and obtain cost and revenue
482 information as it deems necessary to
carry out the commission's obliga-
483 tions under this act and the federal
act. No such audit or investigation
484 and related cost and revenue
information shall be used to regulate
485 a price cap company's earnings in
any manner. An adjustment to a
486 price cap company's KUSF support
does not constitute regulation
487 of earnings so long as the
adjustment is based on the cost of provid-
488 ing universal service and enhanced
universal service.
489
(v) Telecommunications carriers shall not be subject to price
regu-
490 lation, except that: Access charge
reductions shall be passed through to
491 consumers by reductions in basic
intrastate toll prices; and basic toll prices
492 shall remain geographically averaged
statewide. As required under K.S.A.
493 66-131, and amendments thereto, and except
as provided for in subsec-
494 tion (c) of K.S.A. 1998 Supp. 66-2004 and
amendments thereto, telecom-
495 munications carriers that were not
authorized to provide switched local
496 exchange telecommunications services in
this state as of July 1, 1996,
497 including cable television operators who
have not previously offered tel-
498 ecommunications services, must receive a
certificate of convenience
499 based upon a demonstration of technical,
managerial and financial via-
500 bility and the ability to meet quality of
service standards established by
501 the commission. Any telecommunications
carrier or other entity seeking
502 such certificate shall file a statement,
which shall be subject to the com-
503 mission's approval, specifying with
particularity the areas in which it will
504 offer service, the manner in which it will
provide the service in such areas
505 and whether it will serve both business
customers and residential custom-
506 ers in such areas. Any structurally
separate affiliate of a local exchange
507 carrier that provides telecommunications
services shall be subject to the
508 same regulatory obligations and oversight
as a telecommunications car-
509 rier, as long as the local exchange
carrier's affiliate obtains access to any
510 services or facilities from its affiliated
local exchange carrier on the same
511 terms and conditions as the local exchange
carrier makes those services
512 and facilities available to other
telecommunications carriers. The com-
513 mission shall oversee telecommunications
carriers to prevent fraud and
514 other practices harmful to consumers and
to ensure compliance with
515 quality of service standards adopted for
all local exchange carriers and
516 telecommunications carriers in the
state.
517 Sec.
6. K.S.A. 1998 Supp. 66-2008 is hereby amended to read as
518 follows: 66-2008. On or before January 1,
1997, the commission shall
519 establish the Kansas universal service
fund, hereinafter referred to as the
520 KUSF.
521 (a) The initial
amount of the KUSF shall be comprised of local
522 exchange carrier revenues lost as a result
of rate rebalancing pursuant to
523 the initial three-year phase down of
access rates as set forth in subsection
524 (c) of K.S.A. 1998 Supp. 66-2005 and
amendments thereto and subsection
525 (a) of K.S.A. 1998 Supp. 66-2007 and
amendments thereto. Such reve-
526 nues shall be recovered on a revenue
neutral basis. The revenue neutral
527 calculation shall be based on the volumes
and revenues for the 12 months
528 prior to September 30, 1996, adjusted for
any rate changes.
529 (b) The
commission shall require every telecommunications carrier,
530 telecommunications public utility and
wireless telecommunications serv-
531 ice provider that provides intrastate
telecommunications services to con-
532 tribute to the KUSF on an equitable and
nondiscriminatory basis. Any
533 telecommunications carrier,
telecommunications public utility or wireless
534 telecommunications service provider which
contributes to the KUSF may
535 collect from customers an amount equal to
such carrier's, utility's or pro-
536 vider's contribution, except that
before January 1, 2000, no such carrier,
537 provider or utility shall collect from
customers an amount in excess of
538 8.89% of its intrastate retail revenues as
provided in commission docket
539 no. 190-492-U but such carrier, provider
or utility may collect a lesser
540 amount from its customer.
541 Prior to
January 1, 2000, With respect to wireless
telecommunications
542 service providers, an equitable and
nondiscriminatory rate shall be an
543 amount equal to the rate of contributions
of wireline telecommunications
544 service providers, as determined by the
commission, reduced by the per-
545 centage minutes of usage initiated and
terminated entirely over the wire-
546 less network as determined by the
commission. The commission shall
547 establish such rate for wireless
telecommunications service providers no
548 later than December 31, 1998. Any
contributions in excess of distributions
549 collected in any reporting year shall be
applied to reduce the estimated
550 contribution that would otherwise be
necessary for the following year.
551 (c) Pursuant to
the federal act, distributions from the KUSF shall be
552 made in a competitively neutral manner to
qualified telecommunications
553 public utilities, telecommunications
carriers and wireless telecommuni-
554 cations providers, that are deemed
eligible both under subsection (e)(1)
555 of section 214 of the federal act and by
the commission.
556 (d) The
commission shall periodically review the KUSF to
determine
557 if the costs of qualified
telecommunications public utilities, telecommu-
558 nications carriers and wireless
telecommunications service providers to
559 provide local service justify
modification of the KUSF. If the commission
560 determines that any changes are
needed, the commission shall modify
561 the KUSF accordingly
Any pending dockets before the commission,
562 initiated pursuant to this
subsection, shall be completed on or be-
563 fore October 1, 1999. Thereafter,
all such reviews shall be com-
564 pleted within 180 days of initiation
or application. The commission
565 shall make use of any data obtained
pursuant to subsection (u) of
566 K.S.A. 66-2005 and amendments
thereto to resolve any such inves-
567 tigation and review.
On the first day of the month, 60 days after
the
568 effective date of this
legislation, October 1, 1999
distributions from the
569 KUSF to any price cap regulated
company, which currently does not
570 receive funds from the federal
universal service fund pursuant to
571 part 36 of the federal communication
commission rules, shall be lim-
572 ited to the amount of support
established by the commission in Docket
573 No. 190.492-U, $36.88 per high cost
residential and single line business
574 loop, or any amount established by
subsequent modification of that order.
575 This modification of the KUSF
distribution shall not alter the commis-
576 sion's responsibility to ensure that
the KUSF is based on cost consistent
577 with the federal act. No rate
rebalancing shall occur unless justified by
578 cost studies. The commission shall have
continuing responsibility to ensure
579 that contributions to and distributions
from the KUSF are competitively
580 neutral. Any such
company may file an application for support in excess
581 of $36.88. Such application shall
contain cost justification for such excess
582 support. If an application for such
support is filed within 60 days of the
583 company's reduction to $36.88 per high
cost residential and single line
584 business loop, a commission order
granting support in excess of the $36.88
585 shall be retroactive to the date of
filing the application if justified by the
586 cost studies.
587 (e) Any
qualified telecommunications carrier,
telecommunications
588 public utility, which has not elected
price cap regulation or wireless tel-
589 ecommunications service provider may
request supplemental funding
590 from the KUSF based upon a percentage
increase in access lines over
591 the 12-month period prior to the request.
The supplemental funding shall
592 be incurred for the purpose of providing
services to and within the service
593 area of the qualified telecommunications
carrier, telecommunications
594 public utility or wireless
telecommunications service provider. Supple-
595 mental funding from the KUSF shall be used
for infrastructure expend-
596 itures necessary to serve additional
customers within the service area of
597 such qualifying utility, provider or
carrier. All affected parties shall be
598 allowed to review and verify a request of
such a qualified utility, carrier
599 or provider for supplemental funding from
the KUSF, and to intervene
600 in any commission proceeding regarding
such request. The commission
601 shall issue an order on the request within
120 days of filing. Additional
602 funding also may be requested for: The
recovery of shortfalls due to
603 additional rebalancing of rates to
continue maintenance of parity with
604 interstate access rates; shortfalls due to
changes to access revenue
605 requirements resulting from changes in
federal rules; additional invest-
606 ment required to provide universal service
and enhanced universal serv-
607 ice, deployed subject to subsection (a) of
K.S.A. 66-2005, and amend-
608 ments thereto; and for infrastructure
expenditures in response to facility
609 or service requirements established by any
legislative, regulatory or ju-
610 dicial authority. Such requests shall be
subject to simplified filing pro-
611 cedures and the expedited review
procedures, as outlined in the stipu-
612 lation attached to the order of November
19, 1990 in docket no.
613 127,140-U (Phase IV).
614 Supplemental
funding from the KUSF for price cap regulated compa-
615 nies may be requested to cover upward
exogenous cost adjustments. Sup-
616 plemental funding for exogenous
adjustments shall be approved by the
617 commission at the commission's
discretion.
618 (f) Additional
supplemental funding from the KUSF, other than as
619 provided in subsection (e) of this
section, may be authorized at the dis-
620 cretion of the commission. However, the
commission may require ap-
621 proval of such funding to be based upon a
general rate case filing. With
622 respect to any request for additional
supplemental funding from the
623 KUSF, the commission shall act
expeditiously, but shall not be subject to
624 the 120 day deadline set forth in
subsection (e).
625 (g) Any carrier that
collects amounts from its customers to offset
626 its KUSF contribution shall
specifically identify the amount as a
627 separate item on each
bill.
628 Sec.
7. K.S.A. 1998 Supp. 66-2009 is hereby amended to read as
629 follows: 66-2009. (a) Local exchange
carriers that provided switched local
630 exchange services in the state prior to
January 1, 1996, or their successors,
631 shall serve as the carrier of last resort
in their exchanges and shall be
632 eligible to receive KUSF funding.
However, with respect to the Hill City
633 exchange area in which multiple
carriers were certified prior to January
634 1, 1996, the commission's
determination, subject to court appeals, shall
635 determine which authorized carrier
shall serve as carrier of last resort.
636 The local exchange carrier serving as the
carrier of last resort shall remain
637 the carrier of last resort and shall be
entitled to recover the costs of serving
638 as carrier of last resort.
639 (b) Beginning
March 1, 1997, the amount of KUSF funds owed to
640 each qualifying telecommunications
carrier, telecommunications public
641 utility or wireless telecommunications
service provider in the state, based
642 upon the revenue requirements assigned to
the funds for such qualifying
643 utility, carrier or provider, shall be
allocated by the fund administrator in
644 equal monthly installments.
645 Sec. 8. K.S.A. 1998 Supp.
66-1,187, 66-2001, 66-2002, 66-2003, 66-
646 2005, 66-2008, 66-2009, 66-2012
and, 66-2013 and
66-2016 are hereby
647 repealed.
648 Sec. 9. This act shall
take effect and be in force from and after its
649 publication in the Kansas register.