16 TAC §§26.461, 26.463, 26.465
The Public Utility Commission of Texas (commission) adopts
amendments to §26.461, relating to Access Line Categories, §26.463,
relating to Calculation and Reporting of a Municipality's Base Amount, and §26.465,
relating to Methodology for Counting Access Lines and Reporting Requirements
for Certificated Telecommunications Providers with changes to the proposed
text as published in the August 25, 2006 issue of the
Texas Register
(31 TexReg 6612). These amendments are necessary to
address the impact of Senate Bill 5 (SB 5) on the commission's telecommunications
right-of-way (ROW) rules under Subchapter R, Provisions Relating to Municipal
Regulation and Rights-of-Way Management. The commission also redefines the
term "access line" and the categories of access line in §26.461 of this
title pursuant to Texas Local Government Code §283.003 and §26.465(m)
of this title. Local Government Code §283.003 permits the commission
to "modify the definition of "access line" and the categories of access lines
as necessary to ensure competitive neutrality and nondiscriminatory application
and to maintain consistent levels of compensation, as annually increased by
growth in access lines and consumer price index, as applicable, to the municipalities."
Senate Bill 5 amended §283.002 of the Local Government Code by amending
subsection (2) which expanded the definition of the term "certificated telecommunications
provider" to include providers of voice service and adding subsection (7)
which is a definition of the term "Voice service." Local Government Code §283.003
permits the commission to periodically modify the definition of access line
to ensure competitive neutrality and nondiscriminatory application and to
maintain consistent levels of compensation to the municipalities under the
provisions of Subchapter R of this title. The commission is amending §26.461, §26.463
and §26.465 to implement the changes to Local Government Code Chapter
283 and pursuant to the authority granted the commission in Local Government
Code §283.003. Senate Bill 5 also amended the Public Utility Regulatory
Act (PURA) by adding §55.1735, relating to Charge for Pay Phone Access
Line. The commission is also amending §26.465, relating to Methodology
for Counting Access Lines and Reporting Requirements for Certificated Telecommunications
Providers, to clarify that payphones lines are classified as access lines.
On September 14, 2006, the commission received written comments on §§26.461,
26.463 and 26.465 from Southwestern Bell Telephone, L.P., d/b/a AT&T Texas
(AT&T Texas), Verizon Southwest, Bell Atlantic Communications, Inc., MCI
Communications Services, Inc., d/b/a Verizon Business Services, and MCImetro
Access Transmission Services, LLC d/b/a Verizon Access Transmission Services
(collectively Verizon), the Coalition of Cities and the City of Houston (the
Coalition), and Grande Communications Networks, Inc. (Grande). On October
6, 2006, reply comments were received from AT&T Texas, Verizon, the Coalition,
Grande, and Worldcall Internet Inc. (Worldcall). On September 29, 2006, the
commission held a public hearing attended by representatives from AT&T
Texas, Verizon, the Coalition, Grande, and XO Communications (XO) and Time
Warner Communications (Time Warner). Notice of the public hearing and the
questions presented were published in the
Texas Register
on September 22, 2006. At the public hearing, the commenters discussed,
among other issues, whether the language in §26.461(c)(1)(A)(iv) should
be less restrictive so that software application-based providers, such as
Vonage and Skype, would also be subject to municipal ROW access line fees.
In this preamble the terms "software application-based," "application-based,"
"non-facilities based," "application voice-over-internet-protocol (VoIP)"
and "over-the-top" VoIP providers have the same meaning: a service provider
that provides VoIP service via a broadband connection that uses means other
than owned facilities, unbundled network elements or leased facilities, or
resale. Relevant comments at the public hearing are summarized herein to the
extent they differed from the written comments. Parties' comments addressed
specific subsections of the amended rule and are summarized below.
Comments on §26.461
§26.461(c)(1)
The definition of access line in proposed §26.461(c)(1) has been amended
to incorporate the statutory language of §283.002(1) of the Local Government
Code into subsection (c)(1)(A)(i) - (iii) and to add a new clause (iv) which
reads "any other line not described in clauses (i), (ii) or (iii) of this
subparagraph that provides voice service delivered by means of owned facilities,
unbundled network elements or leased facilities, or resale."
1. Scope of SB 5 amendments
Some commenters suggested that the commission-proposed definition of access
line is more restrictive than that contemplated by the SB 5 amendments to
Local Government Code Chapter 283. The Coalition argued that prior to the
SB 5 amendment, wireline Certificated Telecommunications Providers (CTPs)
that provide VoIP service were already counting and filing access line reports.
According to the Coalition, the intent of the "voice service" definition included
in SB 5 could only have been to capture "over-the-top" providers if the voice
service traveled through the public ROW. The Coalition pointed out that broadband
services are not currently assessed a ROW fee and that adding VoIP service
to the access line definition would not result in double counting of municipal
access line fees.
The Coalition, commenting on proposed §26.461(c)(1)(A)(iv), suggested
substituting the phrase "to end-use customers that allow such end-use customers
to receive calls that originate through or on the public switched telephone
network and/or that allow such end-use customers to send calls that terminate
on the public switched telephone network" in place of the proposed language
"delivered by means of owned facilities, unbundled network elements or leased
facilities, or resale." The Coalition asserted that the proposed language
is restrictive and would exclude "over-the-top" voice service providers, including
those that use internet protocol technology such as Vonage, because they do
not "provide service by means of owned facilities, unbundled network elements
or leased facilities, or resale."
AT&T Texas, on the other hand, stated that the proposed definition
of "access line" in §26.461(c)(1) captures the language and intent of §283.002(1)
of the Local Government Code. AT&T Texas commented that the Coalition's
and Grande's proposed language would clearly modify the definition of "access
line" to include "interconnected VoIP providers" and that definition is not
contained in the relevant SB 5 amendment.
Furthermore, AT&T Texas noted that it would be imprudent for the commission
to implement a definition of access lines that included VoIP providers because
of the difficulty of determining if a provider is actually using the ROW,
how to locate providers and how to determine the correct location for the
service. Similarly, Time Warner/XO in its comments at the public hearing,
expressed concern about including "over-the-top" providers in the definition
of access line and the legal challenges that would almost certainly arise
if such a definition were implemented by the commission. The legal challenges
that Time Warner/XO was referring to was in essence a challenge of the commission's
authority to adopt a rule that requires "over-the-top" VoIP providers to pay
municipal ROW fees if such providers could demonstrate that their end-users
are not in fact burdening a municipality's ROW.
Verizon argued that the proposed amendments appeared to implement SB 5,
because municipal access line fees should only be assessed if a provider offers
voice services that pass "through wireline facilities located at least in
part in the public right-of way"
and
"the
voice service is transmitted over an access line" that is owned, leased, or
resold. Verizon also stated that the intent of the legislature with the passage
of SB 5 was not to resolve all ROW issues, and the study of ROW access and
fees, required by PURA §66.017 was intended to address all ROW issues
in a comprehensive manner including the imposition of ROW fees on non-facilities
based interconnected VoIP providers. At the public hearing, Time Warner concurred
with Verizon on this point.
The commission held a public hearing on, among other issues, the question
of whether the definition of "access line" should be expanded beyond that
proposed to include voice service delivered to end-users by providers using
other means, specifically software application-based providers over a broadband
connection, also known as "over-the-top" providers. The commenters that participated
in the hearing did not agree on whether "over-the-top" VoIP providers should
be subject to Subchapter R of the commission's substantive rules. The Coalition
and Grande contended that the plain language of Local Government Code §283.002
(2) and (7) mandate that "over-the-top" VoIP providers must pay compensation
to the municipalities, and that the commission is obligated to adopt rule
language implementing the SB 5 changes to accomplish that end. Verizon, AT&T
Texas, Time Warner/XO argued that §26.461(c)(a) as proposed appropriately
implements the SB 5 changes to Local Government Code Chapter 283.
The Coalition and Grande commented that the proposed definition of "access
line" does not implement the broadly-worded definition of "voice service"
the legislature enacted, but rather negates its effect. The Coalition contended
that the legislature must have intended that all VoIP service providers be
required to pay ROW fees since they provide "voice service" as defined in
Chapter 283.
Commission response
The commission believes that the changes made by SB 5 to Local Government
Code Chapter 283 empower the commission to require VoIP service providers
that provide services by "means of owned facilities, unbundled network elements
or leased facilities, or resale..." to pay municipal ROW access fees as proposed
in §26.461(c)(1)(A)(iv). The commission agrees with the Coalition and
Grande that the proposed definition of "access line" in §26.461(c)(1)(A)(iv)
will prevent application of the rule to "over-the-top" VoIP service providers.
The commission also agrees that the changes to Local Government Code Chapter
283 may empower the commission in some circumstances to require "over-the-top"
VoIP service providers to assess and pay municipal ROW fees, particularly
in the case where the geographic location of the end-user can be determined
with a sufficient degree of certainty and the service is inherently non-nomadic.
However, the commission disagrees with the contention that the legislative
changes to Local Government Code Chapter 283 mandate that any "over-the-top"
VoIP service provider currently serving end-users in Texas must be presently
required to pay municipal ROW fees. Accordingly, for reasons discussed below,
the commission adopts §26.461(c)(1) as proposed.
The commission recognizes that VoIP service is increasingly being adopted
by end-users as a replacement for traditional telephone service. The amendment
to §26.461(c)(1), as adopted, requires facilities-based VoIP providers
that burden the rights-of-way to pay compensation to the municipalities, but
does not require "over-the-top" VoIP providers to pay compensation to the
municipalities at this time. However, in accordance with §283.003 of
the Local Government Code, the commission plans to revisit the definition
of "access line" again in the future, as appropriate, to determine whether
technological changes, market conditions, level of consistent compensation
to the municipalities, and other factors indicate that the service provided
by "over-the-top" VoIP providers should be included in the definition of "access
line." The commission notes that it is obligated under §283.003 of the
Local Government Code and P.U.C. Substantive Rule §26.465(m) to review
the need for modifying the definition of an access line at least once every
three years.
The commission believes it has authority under the provisions of Local
Government Code Chapter 283 to require any person that provides voice service
utilizing access lines, as defined by the commission, to pay municipal ROW
fees. Local Government Code §283.003 gives the commission the power to
redefine the term "access line" periodically and the discretion to adopt a
definition that is consistent with the elements listed in Local Government
Code §283.003 and with legislative intent as expressed in the language
of the entire statute. However, it is a fundamental canon of statutory construction
that the words of a statute must be read in their context and with a view
to their place in the overall statutory scheme. The commission must consider
the provisions of any statute as a whole and not in isolation.
Under Local Government Code Chapter 283 and under §§26.461 through
26.469 of this title, Provisions Relating to Municipal Regulations and Rights-of-Way
Management, an "access line" is the unit of measurement employed to calculate
the amount that must be paid by a CTP to a municipality for use of that municipality's
rights-of-way. Local Government Code §283.002 contains a definition of
"access line," but Local Government Code §283.003 permits the commission
to "modify the definition of 'access line' and the categories of access lines
as necessary to ensure competitive neutrality and nondiscriminatory application
and to maintain consistent levels of compensation, as annually increased by
growth in access lines and consumer price index, as applicable, to the municipalities."
The commission recognizes that changes in Local Government Code Chapter 283
resulting from SB 5, and changes in technology, facilities, and competitive
and market conditions warrant a redefinition of "access line" at the present
time. The commission in this rulemaking proposed a new definition of "access
line" that mirrored the definition in Local Government Code §283.002,
but that also clarified that voice services provided by means of owned facilities,
unbundled network elements or leased facilities, or resale, would now be counted
as an "access line." Voice services provided by other means (
e.g.
, via satellite, via facilities neither owned, leased, by UNEs,
nor resold) would not be counted as an "access line."
However, the criteria listed in Local Government Code §283.003 are
not the beginning and end of the inquiry; they must be read in the context
of the overall statutory scheme. The commission notes that Local Government
Code §283.001, State Policy; Purpose, indicates in part that the "purpose
of this chapter is to establish a uniform method for compensating municipalities
for the use of a public ROW by certificated telecommunications providers that
"is administratively simple for municipalities and telecommunications providers..."
and that is "consistent with the burdens on municipalities created by the
incursion of certificated telecommunications providers into a public right-of-way...."
Section 283.001 also indicates that other purposes of the statute include
establishing a uniform method that is consistent with state and federal law,
is competitively neutral, and is nondiscriminatory in its application. In
reaching its decision to, for the time being, exclude the service provided
by "over-the-top" providers from the definition of "access line," the commission
considered all factors enumerated in the statute, as explained more fully
in the following paragraphs.
The commission agrees with the Coalition and Grande that "over-the-top"
VoIP service providers are providing "voice service" per the statutory definition.
The commission does not agree that it is required in this rulemaking to adopt
a definition of "access line" that ensures that all voice service providers
must be required at present to pay municipal ROW fees, regardless of the other
important, statutorily-mandated considerations mentioned above,
e.g.
, administrative simplicity.
As noted by AT&T Texas in its reply comments, if the commission were
to adopt a definition of "access line" that included "over-the-top" VoIP service
as a line to be counted, the commission would have to be sure that those types
of providers were actually burdening the rights-of-way. The commission notes
that many, if not all, "over-the-top" VoIP services are fully portable or
"nomadic." That is, the end-users may use the service anywhere they can connect
to a broadband connection. Even though an end-user's billing address may be
inside the boundary of a particular municipality, the user may never, or rarely,
make a voice call from or to that municipality. At present even the service
provider is not able to ascertain with certainty the physical location of
an end-user using "over-the-top" VoIP service.
The commission does not believe the state of technology today permits easy
identification of the geographic location of the end-users of "over-the-top"
VoIP services, and therefore declines to adopt a definition of "access line"
that would compel such an end-user, even though she may live in a different
state or country, to pay municipal ROW fees to a particular municipality.
Again, the commission notes that technology is advancing, as always, and there
may come a time in the near future when easy identification of such end-users
is more practicable and administrable from the perspective of Subchapter R
of the commission's substantive rules.
The commission does note that under current federal and state regulations
end-users of "interconnected VoIP services" are required, or at least encouraged,
to provide geographic location information to their service provider to facilitate
9-1-1 services. "Interconnected VoIP service" is defined at 47 C.F.R. §9.3
as a service that (1) enables real-time, two-way communications; (2) requires
a broadband connection from the user's location; (3) requires Internet protocol-compatible
customer premises equipment (CPE); and (4) permits users generally to receive
calls that originate on the public switched telephone network and to terminate
calls to the public switched telephone network. The commission plans to study
the implementation and facilitation of the federal and state 9-1-1 regulations,
and other pertinent state and federal regulations, rules and laws in anticipation
of its review of the definition of "access line" within the next three years.
However, the commission notes that presently no administratively practical
methodology exists to correlate 9-1-1 geographic location information of "over-the-top"
VoIP end-users with the provisions of Subchapter R of the commission's substantive
rules.
The commission notes that neither Local Government Code Chapter 283 nor
the commission's rules includes any definition of "interconnected VoIP services"
but, as mentioned above, there is a definition of the term in the Code of
Federal Regulations at 47 C.F.R §9.3. The term "interconnected VoIP services"
distinguishes between those VoIP service providers that, among other things,
enable the end-user to make and receive calls to and from the public switched
telephone network (PSTN) from those that do not. Local Government Code Chapter
283 and the commission's rules distinguish, for the purposes of this rulemaking,
VoIP service providers that provide service by means of owned, leased, unbundled
network elements or resale and those that provide service by other means.
The FCC employs the term "interconnected VoIP service" to identify, among
other things, those service providers that are subject to the FCC's 9-1-1
rules and those that are not. Whether a service provider permits its end-user
to make calls to and from the PSTN is not determinative under Local Government
Code Chapter 283 as to which service providers are required to pay municipal
ROW fees. Thus, the use of the term "interconnected VoIP services" is informative
to a degree, but not particularly relevant to this rulemaking proceeding.
Furthermore, the commission notes that the important public safety concerns
that underlie federal and state regulations pertaining to 9-1-1 service are
not a concern in this rulemaking. Obviously 9-1-1 service is critical to the
nation's ability to respond to a host of crises, and the FCC's decision to
extend 9-1-1 obligations to virtually all kinds of providers of voice communications
is based on Congress's recognition of the need to protect and preserve life
and property in a time of emergency. This rulemaking and the legislation behind
it concern whether or not certain types of voice service providers must pay
a fee to municipalities for the privilege of using the public ROW. Administration
of the use of public ROWs has not yet been determined to be a matter of national
importance such that Congress has recognized the need to establish a national
methodology for assessing and collecting municipal ROW fees. The commission
notes that if its concerns about identification of the geographic location
of the end-user of "over-the-top" VoIP services can be adequately addressed
by, for example, changes in technology or changes in federal regulations regarding
such services, such changes will inform the commission's decision on whether
the term "access line" should be redefined.
For the reasons discussed above, the commission declines to adopt the changes
to §26.461(c)(1) suggested by the Coalition and Grande and adopts §26.461(c)(1)
as proposed, which excludes "over-the-top" VoIP service providers.
2. Considerations of competitive neutrality, nondiscriminatory
application, and revenue impact on municipalities
The Coalition expressed concern that as the number of non-certificated
VoIP providers increases, the revenue to municipalities in the form of ROW
fees will continue to decrease if these providers are not captured in this
rule. The Coalition contended that an interconnected VoIP provider is essentially
the same as a traditional telephone provider and that such providers should
be paying access line fees because they cannot complete their calls without
using the public ROW. To achieve competitive neutrality, the Coalition argued
that "non-certificated VoIP providers," including "over-the-top" providers,
should be required to pay municipal ROW fees. The Coalition contended that
by continuing to exclude these providers from payment of municipal access
line fees, the commission will be permitting such VoIP providers to maintain
a "competitive regulatory advantage." In its reply comments, Grande supported
the Coalition's arguments regarding "over-the-top" providers. In its reply
comments, AT&T Texas opposed the Coalition's position and stated that
the intent of Local Government Code Chapter 283 was to establish a mechanism
for assessing access line fees for the use of the public ROW, and this intent
should not be overshadowed by issues related to competitive neutrality. AT&T
Texas also advised the commission to "take a cautionary approach" with regard
to deciding who should pay access line fees to make certain that only those
providers that "burden the rights-of-way" are the ones required to pay access
line fees.
Grande recommended that references to owned facilities, unbundled network
elements or leased facilities, or resale in the proposed rule be deleted to
ensure that voice service providers that use the public ROW are included in
the definition and are deemed subject to applicable municipal access fees.
In its reply comments, Grande suggested that the phrase "and that is provided
by means of owned facilities, unbundled network elements, or resale" should
be deleted in §§26.461(c)(1)(A)(i), 26.461(c)(1)(A)(iv), and 26.465(e)(10)
to avoid creating an incentive for telecommunications providers to "separate
organizational responsibility for physical facilities from organizational
responsibility for customers with an eye toward avoidance of the fee in question."
Grande stated that to achieve competitive neutrality the access line definition
should capture all entities, including interconnected VoIP providers that
provide voice services to end-use customers. The Coalition concurred with
Grande.
Worldcall in its reply comments generally objected to the suggestion from
Coalition and Grande to include VoIP service provided by "over-the-top" VoIP
providers in the definition of access lines. Worldcall, an enhanced service
provider, asserted that it does not provide "over-the-top" services like Vonage
and that the current rules impose multiple access line fees on facilities
(facility to Worldcall; facility to Worldcall's wholesale customer; facility
to ultimate customer) and the proposal by Coalition and Grande only exacerbate
the situation by adding yet another access line fee on the VoIP service that
rides on these dedicated circuits.
Commission response
The commission notes that while "over-the-top" VoIP services seem to be
growing in popularity, the level of public use of the service is presently
small relative to all other types of voice service provisioning. The commission
believes that the economic impact on Texas municipalities that results from
its decision to exclude "over-the-top" VoIP providers at the present time
is relatively insignificant. The commission has considered the foregoing as
part of a broad review of the issue of the impact of the proposed rule on
competitive neutrality. The commission believes any impact on competitiveness
between CTPs will be minimal for the same reason. As noted by AT&T Texas
in its reply comments, "concerns over how municipal access line fees are applied
vis-à-vis competitors should not override the purpose of Chapter 283--establishing
an access line fee regime for the municipalities' management of the public
rights-of-way." The commission agrees and has determined that adopting the
proposed changes to §26.461(c) results in a competitively neutral access
line fee regime to the extent possible in light of the state of telecommunications
technology today. The commission recognizes that technology will likely change
over time and that if the use of "over-the-top" VoIP service continues to
grow in popularity, the commission may need to revisit the definition of "access
line" in the future.
Grande's suggestion that the definition of "access line" should be modified
to exclude any reference to owned, leased, unbundled network elements, or
resale is unwarranted. The commission points out that prior to the SB 5 amendments,
Local Government Code Chapter 283 and Subchapter R of the commission's substantive
rules imposed ROW fees on CTPs for access lines that enabled the provision
of local exchange telephone service that are provided by means of owned or
leased facilities, unbundled network elements or resale. SB 5 amendments did
not alter this obligation on CTPs, it merely recognized a new class of providers,
namely uncertificated providers of voice services who would now be subject
to ROW fees under Local Government Code Chapter 283 if they provided voice
communications through wireline facilities located at least in part in the
public ROW. To delete the latter portion of the existing definition of "access
line" contained in Local Government Code §283.002(1) and embodied in §26.461(c)(1)(A)(i),
that reads "that is provided by means of owned facilities, unbundled network
elements or leased facilities, or resale" as Grande suggests is unnecessary
to accomplish what Grande recommends, namely that all voice service providers
should be subject to provisions of Subchapter R of the commission's substantive
rules. The commission believes that Grande's suggested language goes beyond
the scope of the SB 5 amendments. As to Grande's concern about the creation
of an incentive for companies that provide voice service that fall under the
rule to change their business structure to take advantage of the exception,
the commission believes that its decision to revisit its definition of "access
line" within the next three years should alleviate such concerns. For these
reasons, the commission declines to adopt the changes recommended by Grande.
The commission carefully considered the issue of whether limiting the application
of ROW fees to providers that provide voice service by means of owned, leased,
unbundled network elements gives "over-the-top" VoIP providers a competitive
advantage over those entities that are required to pay ROW fees. The commission
believes that given the
de minimus
usage of
"over-the-top" VoIP at present, any concern that such providers will obtain
any significant competitive advantage is unwarranted, particularly in light
of the fact that the commission has stated that it has the statutory authority
to require "over-the-top" VoIP providers to pay ROW fees and that it has the
statutory obligation to review the definition of access line at least once
every three years. On balance, issues of competitive neutrality do not outweigh
other concerns such as feasibility of administration and adequacy of certainty
that the end-user is actually burdening the public ROW. The commission will
address the issue of competitive neutrality again if and when usage of "over-the-top"
VoIP service grows to a significant level.
3. Relevance of recent FCC decisions regarding
interconnected VoIP providers
Grande and the Coalition contended that the recent Federal Communications
Commission (FCC) decisions imposing responsibility on "interconnected VoIP
providers" with respect to E9-1-1, Communications Assistance for Law Enforcement
Act (CALEA), and the Universal Service Fund (USF) are informative, if not
dispositive, of whether interconnected VoIP providers are included in the
list of providers that use "a transmission path through the wireline communications
system to provide service." Further, both Grande and the Coalition cited the
FCC's definition of "interconnected VoIP providers" as services that must
connect with the public switched telecommunications network (PSTN). Grande
argued that payment of ROW fees is analogous to the other requirements recently
extended to interconnected VoIP providers by the FCC.
Verizon, however, argued that ROW fees are
not
analogous to the fees assessed for E9-1-1 and USF purposes. Rather,
Verizon suggested that ROW fees are best described as a property tax. Under
this scenario, only telecommunications providers that own or lease facilities
in the state should pay ROW fees. In support of this argument, Verizon cited
portions of a letter filed by Representative Phil King, Chairman of the House
Regulated Industries Committee in the predecessor rulemaking project, Project
Number 31973. In its reply comments, AT&T Texas offered comments similar
to those of Verizon.
Commission response
The commission agrees with Grande in its reply comments in this proceeding
on the topic: "(i)t is important to remember that this is not a question of
classifying VoIP as a telecommunications service or as an information service
which debate has engendered such consternation in the telecommunications industry.
This is purely a state government question revolving around fees for use of
the public ROW." At this time, it is not clear whether the FCC will decide
to occupy the entire field regarding all types of VoIP services. It has not
done so as yet. As such, the commission believes it has the statutory authority
to subject providers of voice services, as defined in Local Government Code §283.002,
to the provisions of Subchapter R of the commission's substantive rules. For
reasons previously discussed, the commission also believes that it has the
discretion under Local Government Code §283.003 to exclude certain classes
of voice service providers from the provisions of Subchapter R of the commission's
substantive rules.
The commission disagrees with the Coalition and Grande that requiring service
providers in Texas that use VoIP to deliver voice service to pay municipal
ROW fees is analogous to the other requirements recently extended to interconnected
VoIP providers by the FCC. First, as noted previously, Local Government Code
Chapter 283 does not contain a definition of "interconnected VoIP service."
Second, the FCC's decisions in E9-1-1, CALEA, USF orders were based in large
part on the desirability of creating a national framework to ensure the provisions
of each would be uniformly applied. This rulemaking concerns a state statute
that addresses the practical administration of telecommunications service
providers' use of municipal rights-of-way. The commission therefore declines
to adopt the changes to the rule suggested by the Coalition and Grande.
§26.461(d)(1) and (2)
The proposed amendment to §26.461(d)(1) adds the phrase "any other
line that provides residential voice service" under Category 1 lines. Likewise,
the proposed amendment to §26.461(d)(2) would include any other line
that provides non-residential voice service under Category 2 lines. Verizon
offered language to clarify the proposed amendments to §26.461(d)(1)
and (2) and suggested that the new phrases should read "any other
access
line ..." (emphasis added). The Coalition's reply comments supported
this suggested change.
Commission response
The commission finds that Verizon's suggested revisions helps clarify the
type of lines included in categories 1 and 2 and therefore adopts Verizon's
suggested revisions in §26.461(d)(1) and (2).
Comments on §26.463
No comments were filed by the parties on the proposed amendments to §26.463.
Comments on §26.465
§26.465(c)(2)(E)
Proposed §26.465(c)(2)(E) adds a definition for voice service, which
states that "(v)oice service, without regard to the delivery technology, switched
or not, and including Internet protocol technology, shall constitute a single
transmission path." Verizon suggested that the definition of a transmission
path in §26.465(c)(2)(E) should be revised to include the phrase "provided
through wireline facilities located at least in part in the public right-of-way."
The Coalition's reply comments supported this change.
Commission response
The commission finds that Verizon's suggested revisions helps clarify the
definition of voice service and is consistent with the definition of voice
service in Local Government Code Chapter 283. The commission therefore adopts
Verizon's suggested revisions to §26.465(c)(2)(E).
§26.465(d)(4)(A)
Under the proposed rule, §26.465(d)(4)(A) modifies the method in which
access lines are counted, particularly with regard to voice service. Verizon
stated that more clarification is needed in §26.465(d)(4)(A) to explain
adequately how a facility of a CTP will be counted. Verizon proposed that
this subsection be amended to read, "(t)he CTP shall count as one access line
each separate physical facility or logical 56 kbps channel in the public ROW
used to serve an end-use customer." In its reply comments, Verizon recognized
some opposition to its suggested rule language and stated that it was not
opposed to changing the phrase, "or logical 56 kbps channel," as this phrase
may not be technologically neutral so long as the rule language ensures that
CTPs are not assessed separate fees for the same physical facility. The Coalition
cautioned that Verizon's suggested revisions would represent a departure from
the commission's current rules. The Coalition posited that the commission
has traditionally treated services as a 'proxy' for an access line. Therefore,
multiple services can be provided over a single physical line and would be
counted whether they are provided over one physical facility or not. The Coalition
offered the following example: "(i)f a resident has multiple dial tone switched
service, there are then multiple access lines to be counted-perhaps one access
line is for a home office, another one for a fax machine, and yet a third
is for a separate student line." Under the current rule, each of these lines
would incur an access line fee. Grande, in its reply comments, supported the
Coalition's position and stated that the commission's proposed amendment to §26.465(d)(4)(A)
is consistent with the current rule language, which "treats each service as
a separate transmission path."
Commission response
The commission declines to adopt Verizon's suggestion because proposed §26.465(d)(4)(A)
is consistent with the commission's current rules on counting access lines
and adequately explains the counting of voice service lines. Currently each
individual switched service constitutes a single transmission path under §26.465(c)(2)(A)
regardless of the number of switched services provided over the same physical
facility. As the example offered by the Coalition demonstrates, a residential
customer could subscribe to three different lines for his or her residence
and each line would be counted as a separate access line for ROW purposes
even though they are provided over the same physical facility. Similarly,
proposed §26.465(d)(4)(A) counts each end-use customer provided voice
service as one access line with the caveat that vertical features of a voice
service or services bundled with the voice service would not be counted as
a separate access line.
§26.465(d)(4(B)
The proposed amendment to §26.465(d)(4)(B) would require the CTP to
use an end-use customer's billing address, if the physical address could not
be determined, to decide whether or not municipal access line fees should
be assessed. Verizon proposed the deletion of §26.465(d)(4)(B) if the
intent of the commission is to include non-nomadic VoIP providers who must
own or lease a physical facility in the public right-of-way and who would
always know the physical location of an end-use customer. Verizon contended
that the proposed language would capture CTPs that "own or lease a physical
facility in the public ROW;" and would therefore exclude nomadic "over-the-top"
VoIP providers such as Vonage. In contrast to Verizon's comments, Grande suggested
that using the billing address for purposes of counting access lines is appropriate
and should be retained in the proposed rule. In its reply comments, Verizon
changed its position and did not object to §26.465(d)(4)(B), as proposed.
The Coalition suggested that "billing addresses are susceptible to being manipulated
at will by end-users by choosing where a billing is to be received." To avoid
potential billing address manipulation, the Coalition suggested either deleting
the billing address provision as proposed by Verizon or adding language that
would permit carriers to use the billing address only in instances where the
physical location could not be determined and when the registered location
of the customer that is used for E9-1-1 purposes could not be determined.
The Coalition expressed a preference for the latter suggestion.
Commission response
The commission declines to adopt the language proposed by the Coalition
in light of the fact that Verizon has withdrawn its initial objection to proposed §26.465(d)(4)(B).
Also, the proposed language is similar to the method already in use and embodied
in §26.465(d)(2)(D), which attributes non-switched telecommunications
services or private lines to the municipality identified by the CTP's billing
systems when the physical location of the non-switched telecommunications
service or private line cannot be identified. The commission concludes that
reliance on a carrier's existing billing system to identify the location of
end-use customer's voice service in the absence of a physical location would
also minimize the administrative costs of implementing the SB 5 amendments.
§26.465(e)(10)
Proposed §26.465(e)(10) adds language that would include all lines
that provide voice service delivered by means of owned facilities, unbundled
network elements or leased facilities or resale that are not otherwise counted
under §26.465(e). The Coalition believed that substantive changes to §26.465(e)(10)
should be made to capture the intent of SB 5 more fully and to reduce the
possibility of federal preemption. For the same reasons offered by the Coalition
for its suggested changes to §26.465(c)(1)(A)(iv), the Coalition proposed
that §26.465(e)(10) be rewritten to include "all lines that provide voice
service to end-use customers that allow such end-use customers to receive
calls that originate through or on the public switched telephone network and/or
that allow such end-use customers to send calls that terminate on the public
switched telephone network" instead of the phrase "delivered by means of owned
facilities, unbundled network elements or leased facilities, or resale." Grande's
reply comments supported the Coalition's suggested changes to this subsection.
Commission response
The commission has addressed the matter in its response to comments on
the proposed changes to §26.461(c)(1) above. The changes to §26.465(e)(10)
make clear that only voice service that is provided by means of owned facilities,
unbundled network elements or leased facilities or resale is to be counted
as an access line at the present time, consistent with the commission's response
pertaining to §26.461(c)(1) above. Therefore the commission declines
to make the changes suggested by Grande and the Coalition.
Registration of VoIP providers
The Coalition suggested that non-certificated telecommunications providers,
including interconnected VoIP providers, should be required to register with
the commission. The Coalition argued that this would not function as a barrier
to entry, but rather, would assist the commission in enforcing access line
reporting and payment to municipalities. The Coalition cited current procedures
used by the State Comptroller and the Commission on State Emergency Communications
(CSEC), which require an initial registration process. The State Comptroller
uses this process for state sales tax purposes, whereas CSEC uses this process
for E9-1-1 purposes. The Coalition suggested that its proposed registration
process for ROW purposes could be based initially on E9-1-1 and other state
required reports filed by "interconnected VoIP providers."
Commission response
The commission acknowledges that a CTP registration process for non-certificated
voice providers might aid the commission and the municipalities in tracking
non-certificated voice providers that are subject to SB 5. However, the commission
notes that the SB 5 amendments to Local Government Code Chapter 283 are silent
on the issue of registration of non-certificated providers and clearly do
not require certification of VoIP providers. Moreover, establishing a registration
process for non-certificated voice providers would contravene the policy in
PURA §51.001(e) which requires the commission to take action to enhance
competition in telecommunications markets by reducing the cost and burden
of regulation and protecting markets that are not competitive. In any event,
the commission determines that the registration issue is beyond the scope
of this rulemaking project. Interested municipalities may rely on the E9-1-1
and other state required reports filed by most VoIP providers in Texas to
track non-certificated voice providers subject to this section.
All comments, including any not specifically referenced herein, were fully
considered by the commission. In adopting these sections, the commission makes
other minor modifications for the purpose of clarifying its intent.
These amendments are adopted under the PURA §14.002, which
provides the Public Utility Commission with the authority to make and enforce
rules reasonably required in the exercise of its powers and jurisdiction.
These amended sections are also adopted under the Texas Local Government Code §283.003,
which permits the commission to periodically modify the definition of access
line to ensure competitive neutrality and nondiscriminatory application and
to maintain consistent levels of compensation to the municipalities. These
amended sections are also adopted under Local Government Code §283.056(c)(3)
and §283.058, which grant the commission the jurisdiction over municipalities,
certificated telecommunications providers, and voice service providers, necessary
to enforce Local Government Code Chapter 283 and to ensure that all other
legal requirements are enforced in a competitively neutral, non-discriminatory,
and reasonable manner. The amendments are necessary to implement Texas Local
Government Code §283.002(2) and (7) and are also made pursuant to Local
Government Code §283.003.
Cross Reference to Statutes: Public Utility Regulatory Act §14.002
and Texas Local Government Code §§283.002(2) and (7), 283.003, 283.056,
and 283.058.
§26.461.Access Line Categories.
(a)
Purpose. This section establishes three competitively neutral,
non-discriminatory categories of access lines for statewide use in establishing
a uniform method for compensating municipalities for the use of a public right-of-way
by certificated telecommunications providers (CTPs).
(b)
Application. The provisions of this section apply to CTPs,
as defined by subsection (c)(2) of this section, and to municipalities in
the State of Texas.
(c)
Definitions. The following words and terms when used in
this subchapter, shall have the following meaning, unless the context clearly
indicates otherwise.
(1)
Access lines--
(A)
means a unit of measurement representing
(i)
each switched transmission path of the transmission media
that is physically within a public right-of-way extended to the end-use customer's
premises within the municipality, that allows the delivery of local exchange
telephone services within a municipality, and that is provided by means of
owned facilities, unbundled network elements or leased facilities, or resale;
or
(ii)
each termination point or points of a nonswitched telephone
or other circuit consisting of transmission media located within a public
right-of-way connecting specific locations identified by, and provided to,
the end-use customer for delivery of nonswitched telecommunications services
within the municipality; or
(iii)
each switched transmission path within a public right-of-way
used to provide central office-based PBX-type services for systems of any
number of stations within the municipality, and in that instance, one path
shall be counted for every 10 stations served; or
(iv)
any other line not described in clauses (i), (ii) or (iii)
of this subparagraph that provides voice service delivered by means of owned
facilities, unbundled network elements or leased facilities, or resale.
(B)
The definition of "access line" may not be construed to
include interoffice transport or other transmission media that do not terminate
at an end-use customer's premises or to permit duplicate or multiple assessment
of access line rates on the provision of a single service.
(2)
Certificated telecommunications provider (CTP)--A person
who has been issued a certificate of convenience and necessity, certificate
of operating authority, or service provider certificate of operating authority
by the commission to offer local exchange telephone service or a person who
provides voice service.
(3)
Public right-of-way--The area on, below, or above a public
roadway, highway, street, public sidewalk, alley, waterway, or utility easement
in which the municipality has an interest. The term does not include the airways
above a right-of-way with regard to wireless telecommunications.
(4)
Residential--Services provided at residential locations
and primarily for residential (non-commercial) use. Definitions in the tariffs
or price sheets of the provider, and the determinations made by provider for
billing purposes shall control, unless the provider's definitions unreasonably
depart from the general definition herein for purposes of avoidance of the
payment of appropriate fees to the municipality.
(5)
Non-Residential--All other locations not served by a residential
line.
(6)
Voice service--Voice communications services provided through
wireline facilities located at least in part in the public right-of-way, without
regard to the delivery technology, including Internet protocol technology.
The term does not include voice service provided by a commercial mobile service
provider as defined by 47 U.S.C. Section 332(d).
(d)
Access line categories. There shall be three categories
of access lines. The three categories shall be as follows:
(1)
Category 1 shall include both analog and digital residential
switched access lines and any other access line that provides residential
voice service. It shall also include point-to-point private lines, whether
residential or non-residential, only to the extent such lines provide burglar
alarm or other similar security services.
(2)
Category 2 shall include all analog and digital non-residential
switched access lines and any other access line that provides non-residential
voice service.
(3)
Category 3 shall include all other point-to-point private
lines, whether residential or non-residential, not otherwise included within
category 1.
§26.463.Calculation and Reporting of a Municipality's Base Amount.
(a)
Purpose. This section establishes a uniform method for
determining a municipality's base amount and calculating the value of in-kind
services provided to a municipality under an effective franchise agreement
or ordinance by certificated telecommunications providers (CTPs), and sets
forth relevant reporting requirements.
(b)
Application. This section applies to all municipalities
in the State of Texas.
(c)
Definitions. The following words and terms when used in
this subchapter, shall have the following meaning, unless the context clearly
indicates otherwise.
(1)
Base amount--The total amount of revenue received by the
municipality from CTPs in franchise, license, permit, application, excavation,
inspection, and other fees related to the use of a public right-of-way in
calendar year 1998 within the boundaries of the municipality. The base amount
may include revenue from newly annexed areas, the value of in-kind services
or facilities, or municipal fee rate escalation provisions for certain municipalities
as prescribed in subsection (d) of this section.
(A)
The base amount does not include pole rental fees, special
assessments, and taxes of any kind, including ad valorem or sales and use
taxes, or other compensation not related to the use of a public right-of-way.
(B)
The base amount does not include compensation received
from interexchange carriers, cable providers or wireless providers, who may
be CTPs, but whose lines do not meet the definition of access line under §26.461
of this title (relating to Access Line Categories).
(2)
Effective franchise agreement--A franchise agreement or
ordinance that is adopted and effective by its own terms by January 12, 1999,
or by mutual agreement of the parties has been held-over after its expiration
date, without dispute, and the municipality and the CTP were in the process
of developing a new agreement or ordinance.
(3)
In-kind compensation.
(A)
In-kind services--Services received by a municipality from
a CTP during calendar year 1998 at either below cost or no cost as part of
an effective franchise agreement.
(B)
In-kind facilities--Facilities received by a municipality
from a CTP before or during calendar year 1998 at either below cost or at
no cost as part of an effective franchise agreement.
(4)
Litigating municipality--A municipality that was involved
in litigation relating to franchise fees with one or more CTPs during any
part of calendar year 1998.
(5)
Other compensation--Compensation not related to the use
of a public right-of-way paid by a CTP to a municipality, including, but not
limited to, fees paid to the municipality to obtain access to municipally-owned
poles, ducts, conduits, buildings, and other facilities.
(6)
Similarly sized municipality--
(A)
For municipalities with a population less than 1000, a
similarly sized municipality shall be another municipality with a population
within 200 more or fewer persons than the reporting municipality's population,
located in the same or adjacent county as the reporting municipality.
(B)
For municipalities with a population greater than 1000,
a similarly sized municipality shall be another municipality with a population
within 20% of the reporting municipality's population, located in the same
or adjacent county as the reporting municipality.
(C)
Municipal population shall be determined using the January
1, 1999 population estimates of the Texas State Data Center.
(D)
The reporting municipality and the similarly sized municipality
shall have the same CTP with the greatest number of access lines.
(7)
Special assessment--An assessment authorized for public
improvements under the Local Government Code or the Transportation Code.
(d)
Determination of a municipality's base amount. A municipality's
base amount shall be the sum of all applicable revenue received from CTPs,
including newly annexed areas, the value of in-kind compensation, and the
value of any applicable escalation provisions in effective franchise agreements
or ordinances, unless a municipality's base amount is determined under subsection
(f) or (g) of this section.
(1)
Revenue received. Payments received by a municipality from
CTPs as compensation for calendar year 1998 usage of the public right-of-way.
(A)
Payments received outside of calendar year 1998 may be
included as revenue received only to the extent that these payments represent
compensation for calendar year 1998 usage of a public right-of-way.
(B)
Payments received in calendar year 1998 that do not represent
compensation for calendar year 1998 usage of a public right-of-way shall be
excluded.
(2)
Escalation provisions. The municipality shall calculate
and report its fee rate escalation amount that is known and measurable for
calendar year 1999, that was specifically prescribed in effective agreements
or ordinances, and add that escalation amount to the base amount calculation.
(3)
In-kind compensation. In-kind services or facilities shall
be valued at 1.0% of the base amount unless a municipality can establish before
the commission that those services or facilities had a greater value in calendar
year 1998. Municipalities requesting in-kind compensation above 1.0% of the
base amount shall make a request consistent with subsections (e) and (j) of
this section.
(e)
Valuation of additional in-kind compensation. If a municipality
wants to establish that the total value of in-kind compensation received from
CTPs had a greater value in 1998 than 1.0% of the municipality's base amount,
it must make a showing consistent with this subsection and meet the filing
requirements of subsection (j) of this section.
(1)
Telecommunications equipment. The municipality shall compute
the 1998 value by dividing the original cost of the equipment by the term
in years of the effective franchise agreement.
(2)
Dark fiber. Where a municipality had the option to use
the CTP's dark fiber as in-kind compensation in calendar year 1998, the municipality
shall value the fiber only to the extent the municipality utilized it in calendar
year 1998. The value shall be computed in accordance with paragraph (4) of
this subsection. Where a CTP permanently transferred ownership of the dark
fiber to the municipality as in-kind compensation before or during calendar
year 1998, the value of the dark fiber shall be computed for its entire length
in accordance with paragraph (1) of this subsection.
(3)
Poles, ducts, and conduits. Where a municipality had the
option to use the CTP's poles, ducts, and conduits as part of its in-kind
compensation, it shall value those facilities only to the extent the municipality
utilized them during calendar year 1998. The value of the poles, ducts and
conduits shall be based upon reasonable annual rental fees charged or paid
by other utilities for similar facilities. Where a municipality and a CTP
have entered into a joint-use agreement for the use of poles, ducts, or conduits,
no value shall be included in computing in-kind compensation for such use.
(4)
Telecommunications service. The municipality shall value
the telecommunications service it received as in-kind compensation by determining
the fees paid by other municipalities for same or similar services, or through
the average price charged in 1998 by three suppliers qualified to provide
the service.
(5)
All other facilities and services. The municipality shall
perform a survey of suppliers for all other in-kind facilities and services
it received in calendar year 1998, to establish true market values. The municipality
shall survey at least three suppliers for each facility or service it is valuing.
(f)
Base amount for eligible municipalities.
(1)
Eligible municipalities include municipalities in counties
with a population of less than 25,000 on December 31, 1998, municipalities
that did not have an effective franchise agreement or ordinance on January
12, 1999, and municipalities that were not in existence on January 12, 1999.
A municipality that was incorporated prior to January 12, 1999 but received
no compensation from CTPs for calendar 1998 use of the public right-of-way,
shall also be considered an eligible municipality.
(A)
If a municipality is located in more than one county, its
eligibility shall be determined by the county containing the greatest number
of its residents.
(B)
County population shall be determined using the Texas State
Data Center population estimates for January 1, 1999.
(2)
The base amount for an eligible municipality shall, at
the election of the governing body of the municipality, be equal to one of
the following amounts:
(A)
An amount not greater than the statewide average fee per
line for each category of access line of the CTP with the greatest number
of access lines in that municipality, multiplied by the total number of access
lines in each category located within the boundaries of the municipality on
December 31, 1998, for a municipality in existence on that date, or on the
date of incorporation for a municipality incorporated after that date; or
(B)
An amount not greater than the base amount determined for
a similarly sized municipality in the same or an adjacent county in which
the CTP with the greatest number of access lines in the municipality is the
same for each municipality. The similarly sized municipality must have computed
its base amount using methods other than this paragraph; or
(C)
The total amount of revenue received by the municipality
in franchise, license, permit, and application fees from all CTPs in calendar
year 1998 consistent with the methodology prescribed under subsection (d)(1)
of this section.
(g)
Base amount for litigating municipality. The base amount
for a litigating municipality that not later than December 1, 1999, repeals
any ordinance subject to dispute in the litigation, voluntarily dismisses
with prejudice any claims in the litigation for compensation, and agrees to
waive any potential claim for compensation under any franchise agreement or
ordinance expired or in existence on September 1, 1999, is, at the municipality's
election, equal to one of the following amounts:
(1)
An amount not to exceed the statewide average access line
rate on a per category basis for the CTP with the greatest number of access
lines in that municipality multiplied by the total number of access lines
located within the boundaries of the municipality on December 31, 1998, including
any newly annexed areas; or
(2)
An amount not to exceed 21% of the total sales and use
tax revenue received by the municipality pursuant to Texas Tax Code, Chapter
321. The sales and use tax revenue will be based on the calendar year 1998
report of taxes collected, as issued by the State Comptroller for a municipality.
The amount does not include sales and use taxes collected under:
(A)
Texas Transportation Code, Chapters 451, 452, 453, or 454
for a mass transit authority;
(B)
the Development Corporation Act of 1979 (Article 5190.6,
Vernon's Texas Civil Statutes), for a 4A or 4B Development Corporation;
(C)
Texas Local Government Code, Chapters 334 and 335; and
(D)
Texas Tax Code, Chapters 321, 322, and 323, for a special
district, including health service, crime control, hospital, and emergency
service districts.
(h)
Books and records. Subject to request by the commission,
a municipality shall provide sufficient records and documentation to substantiate
its base amount calculation as prescribed in this chapter. A municipality
shall maintain books and records relating to compensation received pursuant
to Texas Local Government Code, Chapter 283, in accordance with generally
accepted accounting principles (GAAP) and state and federal guidelines, and
in a manner that allows for easy identification and reporting of right-of-way
fees received from each CTP.
(i)
Reporting procedures and requirements.
(1)
Who shall file. The record-keeping and reporting requirements
listed in this section shall apply to all municipalities in the State of Texas.
(2)
Reporting. Unless otherwise specified, periodic reporting
shall be consistent with this subsection and subsection (m) of this section.
(A)
Initial reporting. A municipality shall file its base amount
using the commission-approved
Form for Calculating
Right-of-way Compensation
(FCRC), or the commission-approved Program for Calculating Right-of-way Compensation
(PCRC),
with the commission no later than December 1, 1999 under Project Number 20935, Implementation of HB 1777
.
(B)
Subsequent reporting.
(i)
The commission may periodically require each municipality
to file with the commission, on an as-needed basis, a report on municipal
compensation. The report shall include all amounts received annually pursuant
to this section and shall identify quarterly payments from each CTP.
(ii)
The commission may request additional documentation if
it determines a filing by the municipality is insufficient. If the commission
requires additional information, the municipality shall respond and provide
the needed documents to the commission within 30 days from the time the municipality
receives the request.
(j)
Reporting for additional in-kind compensation. This subsection
applies only to a municipality valuing in-kind compensation at a level greater
than 1.0% of its base amount, pursuant to subsection (e) of this section.
The municipality maintains the burden of proof for establishing the reasonableness
of its valuation. No later than December 1, 1999, the municipality shall file
using the commission-approved
Form for Valuing In-kind
Compensation Over 1.0%
. If the commission determines that the value
of in-kind compensation is less than the value claimed by the municipality,
the value of in-kind compensation for that municipality shall, on an interim
basis, default to 1.0% of the base amount until the municipality makes a showing
consistent with this section and subsection (e) of this section.
(k)
Allocation of Base Amount. Not later than December 1, 1999,
a municipality that wants to propose an allocation of the base amount over
specific access line categories shall notify the commission of the desired
allocation. The commission shall establish an allocation of the base amount
over the categories of access lines if a municipality does not file its proposed
allocation by December 1, 1999.
(1)
A municipality may request a modification of the commission's
allocation not more than once every 24 months by notifying the commission
and all affected CTPs in September of that year that the municipality wants
to change the allocation for the next calendar year.
(2)
A municipality's allocation shall be implemented unless,
on complaint by an affected CTP, the commission determines that the allocation
is not just and reasonable, is not competitively neutral, or is discriminatory.
(l)
Late, insufficient, or incorrect filing.
(1)
If a municipality fails to complete its base amount report
by the date required by this section, the commission shall assume that the
base amount for that municipality is $0.
(2)
All commission-established rates and all compensation thereunder
shall be applied prospectively from the date the CTPs timely implement the
appropriate rates.
(3)
A CTP shall not take more than 90 days to implement the
rates established by the commission.
(m)
Report attestation. All filings with the commission pursuant
to this section shall be in accordance with the commission-approved FCRC or
PCRC instructions, as appropriate. The filings shall be attested to by an
officer or authorized representative of the municipality under whose direction
the report is prepared or other official in responsible charge of the entity
in accordance with §26.71(d) of this title (relating to General Procedures,
Requirements and Penalties).
§26.465.Methodology for Counting Access Lines and Reporting Requirements for Certificated Telecommunications Providers.
(a)
Purpose. This section establishes a uniform method for
counting access lines within a municipality by category as provided by §26.461
of this title (relating to Access Line Categories), sets forth relevant reporting
requirements, and sets forth certain reseller obligations under the Local
Government Code, Chapter 283.
(b)
Application. This section applies to all certificated telecommunications
providers (CTPs) in the State of Texas.
(c)
Definitions. The following words and terms when used in
this section, shall have the following meaning, unless the context clearly
indicates otherwise.
(1)
Customer--The retail end-use customer.
(2)
Transmission path--A path within the transmission media
that allows the delivery of switched local exchange service or provides voice
service.
(A)
Each individual switched service shall constitute a single
transmission path.
(B)
Where services are offered as part of a bundled group of
services, each switched service in that bundled group of services shall constitute
a single transmission path.
(C)
Services that constitute vertical features of a switched
service,
e.g.
, call waiting, caller-ID, do
not constitute a transmission path.
(D)
Where a service or technology is channelized by the CTP
and results in a separate switched path for each channel, each such channel
shall constitute a single transmission path.
(E)
Voice service provided through wireline facilities located
at least in part in the public right-of-way, without regard to the delivery
technology, switched or not, and including Internet protocol technology, shall
constitute a single transmission path.
(3)
Wireless provider--A provider of commercial mobile service
as defined by §332(d), Communications Act of 1934 (47 U.S.C. §151 et seq
.), Federal Communications Commission rules,
and the Omnibus Budget Reconciliation Act of 1993 (Public Law 103-66).
(d)
Methodology for counting access lines. A CTP's access line
count shall be the sum of all lines counted pursuant to paragraphs (1), (2),
(3), and (4) of this subsection, and shall be consistent with subsections
(e), (f) and (g) of this section.
(1)
Switched transmission paths and services.
(A)
The CTP shall determine the total number of switched transmission
paths, and shall take into account the number of switched services provided
and the number of channels used where a service or technology is channelized.
(B)
All switched services shall be counted in the same manner
regardless of the type of transmission media used to provide the service.
(C)
If the transmission path crosses more than one municipality,
the line shall be counted in, and attributed to, the municipality where the
end-use customer is located. Pursuant to Local Government Code §283.056(f),
the per-access-line franchise fee paid by CTPs constitutes full compensation
to a municipality for all of a CTP's facilities located within a public right-of-way,
including interoffice transport and other transmission media that do not terminate
at an end-use customer's premises, even though those types of lines are not
used in the calculation of the compensation.
(2)
Nonswitched telecommunications services or private lines.
(A)
Each circuit used to provide nonswitched telecommunications
services or private lines to an end-use customer, shall be considered to have
two termination points, one on each customer location identified by the customer
and served by the circuit.
(B)
The CTP shall count nonswitched telecommunications services
or private lines by totaling the number of terminating points within a municipality.
(C)
A nonswitched telecommunications service shall be counted
in the same manner regardless of the type of transmission media used to provide
that service.
(D)
A terminating point shall be counted in, and attributed
to, the municipality where that point is located. In the event a CTP is not
able to identify the physical location of the terminating point, that point
shall be attributed to the municipality identified by the CTP's billing systems.
(E)
Where dark (unlit) fiber is provided to an end-use customer
who then lights it, the line shall be counted as a private line, by default,
unless it is evident that it is used for providing switched services.
(3)
Central office based PBX-type services. The CTP shall count
one access line for every ten stations served.
(4)
Voice service.
(A)
The CTP shall count each end-use customer provided voice
service as one access line. Services that constitute vertical features of
a voice service, or are bundled with the voice service shall not be counted
as a separate access line.
(B)
In the event a CTP is unable to identify the physical location
of an end-use customer utilizing voice service, but that end-use customer's
billing address, as identified in the CTP's billing system, is located inside
the boundaries of a municipality, the end-use customer's access line shall
be attributed to the municipality where such billing address is located.
(e)
Lines to be counted. A CTP shall count the following access
lines:
(1)
all access lines provided to a retail end-use customer;
(2)
all access lines provided as a retail service to other
CTPs and resellers for their own end-use;
(3)
all access lines provided as a retail service to wireless
telecommunication providers and interexchange carriers (IXCs) for their own
end-use;
(4)
all access lines a CTP provides as employee concession
lines and other similar types of lines;
(5)
all access lines provided as a retail service to a CTP's
wireless and IXC affiliates for their own end-use, and all access lines provided
as a retail service to any other affiliate for their own end-use;
(6)
dark fiber, to the extent it is provided as a service or
is resold by a CTP and shall exclude lines sold and resold by non-CTPs;
(7)
any other lines meeting the definition of access line as
set forth in §26.461 of this title;
(8)
Lifeline lines;
(9)
all retail pay telephone access lines; and
(10)
all lines that provide voice service delivered by means
of owned facilities, unbundled network elements or leased facilities, or resale
that are not otherwise counted under paragraphs (1) - (9) of this subsection.
(f)
Lines not to be counted. A CTP shall not count the following
lines:
(1)
all lines that do not terminate at an end-use customer's
premises;
(2)
lines used by providers who are not end-use customers such
as CTP, wireless provider, or IXC for interoffice transport, or back-haul
facilities used to connect such providers' telecommunications equipment;
(3)
lines used by a CTP's wireless and IXC affiliates who are
not end-use customers, for interoffice transport, or back-haul facilities
used to connect such affiliates' telecommunications equipment;
(4)
lines used by any other affiliate of a CTP for interoffice
transport; and
(5)
any other lines that do not meet the definition of access
line as set forth in §26.461 of this title.
(g)
Reporting procedures and requirements.
(1)
Who shall file. The record keeping, reporting and filing
requirements listed in this section or in §26.467 of this title (relating
to Rates, Allocation, Compensation, Adjustments and Reporting) shall apply
to all CTPs in the State of Texas.
(2)
Initial reporting requirements.
(A)
No later than January 24, 2000, a CTP shall file its access
line count using the commission-approved
Form for
Counting Access Line or Program for Counting Access Lines
with the
commission. The CTP shall report the access line count as of December 31,
1998, except as provided in subparagraph (C) of this paragraph.
(B)
A CTP shall not include in its initial report any access
lines that are resold, leased, or otherwise provided to a CTP, unless it has
agreed to a request from another CTP to include resold or leased lines as
part of its access line report.
(C)
A CTP that cannot file access line count as of December
31, 1998 shall file request for good cause exemption and shall file the most
recent access line count available for December, 1999.
(D)
A CTP shall not make a distinction between facilities and
capacity leased or resold in reporting its access line count.
(h)
Exemption. Any CTP that does not terminate a franchise
agreement or obligation under an existing ordinance shall be exempted from
subsequent reporting pursuant to §26.467 of this title unless and until
the franchise agreement is terminated or expires on its own terms. Any CTP
that fails to provide notice to the commission and the affected municipality
by December 1, 1999 that it elects to terminate its franchise agreement or
obligation under an existing ordinance, shall be deemed to continue under
the terms of the existing ordinance. Upon expiration or termination of the
existing franchise agreement or ordinance by its own terms, a CTP is subject
to the terms of this section.
(i)
Maintenance and location of records. A CTP shall maintain
all records, books, accounts, or memoranda relating to access lines deployed
in a municipality in a manner which allows for easy identification and review
by the commission and, as appropriate, by the relevant municipality. The books
and records for each access line count shall be maintained for a period of
no less than three years.
(j)
Proprietary or confidential information.
(1)
The CTP shall file with the commission the information
required by this section regardless of whether this information is confidential.
For information that the CTP alleges is confidential and/or proprietary under
law, the CTP shall file a complete list of the information that the CTP alleges
is confidential. For each document or portion thereof claimed to be confidential,
the CTP shall cite the specific provision(s) of the Texas Government Code,
Chapter 552, that the CTP relies to assert that the information is exempt
from public disclosure. The commission shall treat as confidential the specific
information identified by the CTP as confidential until such time as a determination
is made by the commission, the Attorney General, or a court of competent jurisdiction
that the information is not entitled to confidential treatment.
(2)
The commission shall maintain the confidentiality of the
information provided by CTPs, in accordance with the Public Utility Regulatory
Act (PURA) §52.207.
(3)
If the CTP does not claim confidential treatment for a
document or portions thereof, then the information will be treated as public
information. A claim of confidentiality by a CTP does not bind the commission
to find that any information is proprietary and/or confidential under law,
or alter the burden of proof on that issue.
(4)
Information provided to municipalities under the Local
Government Code, Chapter 283, shall be governed by existing confidentiality
procedures which have been established by the commission in compliance with
PURA §52.207.
(5)
The commission shall notify a CTP that claims its filing
as confidential of any request for such information.
(k)
Report attestation. All filings with the commission pursuant
to this section shall be in accordance with §22.71 of this title (relating
to Filing of Pleadings, Documents and Other Materials) and §22.72 of
this title (relating to Formal Requisites of Pleadings and Documents to Be
Filed With the Commission). The filings shall be attested to by an officer
or authorized representative of the CTP under whose direction the report is
prepared or other official in responsible charge of the entity in accordance
with §26.71(d) of this title (relating to General Procedures, Requirements
and Penalties). The filings shall include a certified statement from an authorized
officer or duly authorized representative of the CTP stating that the information
contained in the report is true and correct to the best of the officer's or
representative's knowledge and belief after inquiry.
(l)
Reporting of access lines that have been provided by means
of resold services or unbundled facilities to another CTP. This subsection
applies only to a CTP reporting access lines under §26.467 of this title,
that are provided by means of resold services or unbundled facilities to another
CTP who is not an end-use customer. Nothing in this subsection shall prevent
a CTP reporting another CTP's access line count from charging an appropriate,
tariffed administrative fee for such service.
(m)
Commission review of the definition of access line.
(1)
Pursuant to the Local Government Code §283.003, not
later than September 1, 2002, the commission shall determine whether changes
in technology, facilities, or competitive or market conditions justify a modification
of the adoption of the definition of "access line" provided by §26.461
of this title. The commission may not begin a review authorized by this subsection
before March 1, 2002.
(2)
As part of the proceeding described by paragraph (1) of
this subsection, and as necessary after that proceeding, the commission by
rule may modify the definition of "access line" as necessary to ensure competitive
neutrality and nondiscriminatory application and to maintain consistent levels
of compensation, as annually increased by growth in access lines and consumer
price index, as applicable, to the municipalities.
(3)
After September 1, 2002, the commission, on its own motion,
shall make the determination required by this subsection at least once every
three years.
This agency hereby certifies that the adoption has been
reviewed by legal counsel and found to be a valid exercise of the agency's
legal authority.
Filed with the Office of
the Secretary of State on December 21, 2006.
TRD-200606870
Adriana A. Gonzales
Rules Coordinator
Public Utility Commission of Texas
Effective date: January 10, 2007
Proposal publication date: August 25, 2006
For further information, please call: (512) 936-7223