Sec.  69.306   Central office equipment (COE).

   (a)  The  Separations  Manual categories shall be used for purposes of
   apportioning investment in such equipment except that any Central office
   equipment attributable to local transport shall be assigned to the Transport
   elements.

   (b) COE Category 1 (Operator Systems Equipment) shall be apportioned among
   the interexchange category and the access elements as follows: Category 1
   that is used for intercept services shall be assigned to the Local Switching
   element. Category 1 that is used for directory assistance shall be assigned
   to the Information element. Category 1 other than service observation boards
   that  is  not  assigned to the Information element and is not used for
   intercept services shall be assigned to the interexchange category. Service
   observation boards shall be apportioned among the interexchange category,
   and the Information and Transport access elements based on the remaining
   combined investment in COE Category 1, Category 2 and Category 3.

   (c)  COE  Category 2 (Tandem Switching Equipment) that is deemed to be
   exchange equipment for purposes of the Modification of Final Judgment in
   United  States v. Western Electric Co. shall be assigned to the tandem
   switching charge subelement and the interconnection charge element. COE
   Category 2 which is associated with the signal transfer point function shall
   be assigned to the local switching category. COE Category 2 which is used to
   provide  transmission  facilities between the local exchange carrier's
   signalling transfer point and the database shall be assigned to the Line
   Information Database subelement at  Sec. 69.120(a). All other COE Category 2
   shall be assigned to the interexchange category.

   (d) COE Category 3 (Local Switching Equipment) shall be assigned to the
   Local Switching element except as provided in paragraph (a) of this section;
   and that,

   (1) For telephone companies subject to price cap regulation set forth in
   part 61 of this chapter, line-side port costs shall be assigned to the
   Common Line rate element; and

   (2) Beginning January 1, 2002, for non-price cap local exchange carriers,
   line-side port costs shall be assigned to the Common Line rate element. Such
   amount  shall be determined after any local switching support has been
   removed from the interstate Local Switching revenue requirement. Non-price
   cap local exchange carriers may use thirty percent of the interstate Local
   Switching revenue requirement, minus any local switching support, as a proxy
   for allocating line port costs to the Common Line category.

   (e)  COE Category 4 (Circuit Equipment) shall be apportioned among the
   interexchange category and the Common Line, Transport, and Special Access
   elements. COE Category 4 shall be apportioned in the same proportions as the
   associated Cable and Wireless Facilities; except that any DS1/voice-grade
   multiplexer investment associated with analog local switches and assigned to
   the local transport category by this section shall be reallocated to the
   local switching category.

   [ 52 FR 37312 , Oct. 6, 1987, as amended at  57 FR 54722 , Nov. 20, 1992;  58 FR 30995 , May 28, 1993;  62 FR 31938 , June 11, 1997;  66 FR 59732 , Nov. 30, 2001]