Goto Section: 61.47 | 61.49 | Table of Contents
FCC 61.48
Revised as of October 1, 2008
Goto Year:2007 |
2009
Sec. 61.48 Transition rules for price cap formula calculations.
(a)–(h) [Reserved]
(i) Transport and Special Access Density Pricing Zone Transition Rules —(1)
Definitions. The following definitions apply for purposes of paragraph (i)
of this section:
Earlier date is the earlier of the special access zone date and the
transport zone date.
Earlier service is special access if the special access zone date precedes
the transport zone date, and is transport if the transport zone date
precedes the special access zone date.
Later date is the later of the special access zone date and the transport
zone date.
Later service is transport if the special access zone date precedes the
transport zone date, and is special access if the transport zone date
precedes the special access zone date.
Revenue weight of a given group of services included in a zone category is
the ratio of base period demand for the given service rate elements included
in the category priced at existing rates, to the base period demand for the
entire group of rate elements comprising the category priced at existing
rates.
Special access zone date is the date on which a local exchange carrier
tariff establishing divergent special access rates in different zones, as
described in Sec. 69.123(c) of this chapter, becomes effective.
Transport zone date is the date on which a local exchange carrier tariff
establishing divergent switched transport rates in different zones, as
described in Sec. 69.123(d) of this chapter, becomes effective.
(2) Simultaneous Introduction of Special Access and Transport Zones. Local
exchange carriers subject to price cap regulation that have established
density pricing zones pursuant to Sec. 69.123 of this chapter, and whose special
access zone date and transport zone date occur on the same date, shall
initially establish density pricing zone SBIs and bands pursuant to the
methodology in Sec. Sec. 61.47(e) through (f).
(3) Sequential Introduction of Zones in the Same Tariff Year.
Notwithstanding Sec. Sec. 61.47(e) through (f), local exchange carriers subject to
price cap regulation that have established density pricing zones pursuant to
Sec. 69.123 of this chapter, and whose special access zone date and transport
zone date occur on different dates during the same tariff year, shall, on
the earlier date, establish density pricing zone SBIs and pricing bands
using the methodology described in Sec. Sec. 61.47(e) through (f), but applicable to
the earlier service only. On the later date, such carriers shall recalculate
the SBIs and pricing bands to limit the pricing flexibility of the services
included in each density pricing zone category, as reflected in its SBI, as
follows:
(i) The upper pricing band shall be a weighted average of the following:
(A) The upper pricing band that applied to the earlier services included in
the zone category on the day preceding the later date, weighted by the
revenue weight of the earlier services included in the zone category; and
(B) 1.05 times the SBI value for the services included in the zone category
on the day preceding the later date, weighted by the revenue weight of the
later services included in the zone category.
(ii) [Reserved]
(iii) On the later date, the SBI value for the zone category shall be equal
to the SBI value for the category on the day preceding the later date.
(4) Introduction of Zones in Different Tariff Years. Notwithstanding
Sec. Sec. 61.47(e) through (f), those local exchange carriers subject to price cap
regulation that have established density pricing zones pursuant to Sec. 69.123
of this chapter, and whose special access zone date and transport zone date
do not occur within the same tariff year, shall, on the earlier date,
establish density pricing zone SBIs and pricing bands using the methodology
described in Sec. Sec. 61.47(e) through (f), but applicable to the earlier service
only.
(i) On the later date, such carriers shall use the methodology set forth in
paragraphs (a) through (d) of Sec. 61.47 to calculate separate SBIs in each zone
for each of the following groups of services:
(A) DS1 special access services;
(B) DS3 special access services;
(C) DS1 entrance facilities, DS1 direct-trunked transport, and DS1 dedicated
signalling transport;
(D) DS3 entrance facilities, DS3 direct-trunked transport, and DS3 dedicated
signalling transport;
(E) Voice grade entrance facilities, voice grade direct-trunked transport,
and voice grade dedicated signalling transport;
(F) Tandem-switched transport; and
(G) Such other special access services as the Commission may designate by
order.
(ii) From the later date through the end of the following tariff year, the
annual pricing flexibility for each of the subindexes specified in paragraph
(i)(4)(i) of this section shall be limited to an annual increase of five
percent or an annual decrease of fifteen percent, relative to the percentage
change in the PCI for the trunking basket, measured from the levels in
effect on the last day of the tariff year preceding the tariff year in which
the later date occurs.
(iii) On the first day of the second tariff year following the tariff year
during which the later date occurs, the local exchange carriers to which
this paragraph applies shall establish the separate subindexes provided in
Sec. 61.47(e), and shall set the initial SBIs for those density pricing zone
categories that are combined (specified in paragraphs (i)(4)(i)(A),
(i)(4)(i)(B), (i)(4)(i)(C), (i)(4)(i)(D), (i)(4)(i)(E), and (i)(4)(i)(G) of
this section) by computing the weighted averages of the SBIs that applied to
the formerly separate zone categories, weighted by the revenue weights of
the respective services included in the zone categories.
(j)–(k) [Reserved]
(l) Average Traffic Sensitive Revenues. (1) In the July 1, 2000 annual
filing, price cap local exchange carriers will make an additional reduction
to rates comprising ATS charge, and to associated SBI upper limits and PCIs.
This reduction will be calculated to be the amount that would be necessary
to achieve a total $2.1 billion reduction in carrier common line and ATS
rates by all price cap local exchange carriers, compared with those rates as
they existed on June 30, 2000 using 2000 annual filing base period demand.
(i) The net change in revenue associated with Carrier Common Line Rate
elements resulting from:
(A) The removal from access of price cap local exchange carrier
contributions to the Federal universal service mechanisms;
(B) Price cap local exchange carrier receipts of interstate access universal
service support pursuant to subpart J of part 54;
(C) Changes in End User Common Line Charges and PICC rates;
(D) Changes in Carrier Common Line charges due to GDP-PI—X targeting for
$0.0095 filing entities.
(ii) Reductions in Average Traffic Sensitive charges resulting from:
(A) Targeting of the application of the (GDP-PI—X) portion of the formula in
Sec. 61.45(b), and any applicable “g” adjustments;
(B) The removal from access of price cap local exchange carrier
contributions to the Federal universal service mechanisms;
(C) Additional ATS charge reductions defined in paragraph (2) of this
section.
(2) Once the reductions in paragraph (l)(1)(i) and paragraphs (l)(1)(ii)(A)
and (l)(1)(ii)(B) of this section are identified, the difference between
those reductions and $2.1 billion is the total amount of additional
reductions that would be made to ATS rates of price cap local exchange
carriers. This amount will then be restated as the percentage of total price
cap local exchange carrier Local Switching revenues as of June 30, 2000
using 2000 annual filing base period demand (“June 30 Local Switching
revenues”) necessary to yield the total amount of additional reductions and
taking into account the fact that, if participating, a price cap local
exchange carrier would not reduce ATS rates below its Target Rate as set
forth in Sec. 61.3(qq). Each price cap local exchange carrier then reduces ATS
rate elements, and associated SBI upper limits and PCIs, by a dollar amount
equivalent to the percentage times the June 30 Local Switching revenues for
that filing entity, provided that no price cap local exchange carrier shall
be required to reduce its ATS rates below its Target Rate as set forth in
Sec. 61.3(qq). Each carrier can take its additional reductions against any of
the ATS rate elements, provided that at least a proportional share must be
taken against Local Switching rates.
(m) Pooled Local Switching Revenues. (1) Price cap local exchange carriers
are permitted to pool local switching revenues in their CMT basket under one
of the following conditions.
(i) Any price cap local exchange carrier that would otherwise have July 1,
2000 price cap reductions as a percentage of Base Period Price Cap Revenues
at the holding company level greater than the industry wide total July 1,
2000 price cap revenue reduction as a percentage of Base Period Price Cap
Revenues may elect temporarily to pool the amount of the additional
reductions above 25% of the Local Switching element revenues necessary to
yield that carrier's proportionate share of a total $2.1 billion reduction
in switched access usage rates on July 1, 2000. The basis of the reduction
calculation will be R at PCIt-1for the upcoming tariff year. The percentage
reductions per line amounts will be calculated as follows: (Total Price Cap
Revenue Reduction ÷ Base Period Price Cap Revenues)
Pooled local switching revenue for each filing entity within a holding
company that qualifies under this paragraph (i) will continue until such
pooled revenues are eliminated under this paragraph. Notwithstanding the
provisions of Sec. 61.45(b)(1), once the Average Traffic Sensitive (ATS) rate
reaches the applicable Target Rate as set forth in Sec. 61.3(qq), the Targeted
Revenue Differential as defined in Sec. 61.45(i) shall be targeted to reducing
pooled local switching revenue until the pooled local switching revenue is
eliminated. Thereafter, the X-factor for these baskets will be determined in
accordance with Sec. 61.45(b)(1).
(ii) Price cap local exchange carriers other than the Bell companies and GTE
with at least 20% of total holding company lines operated by companies that
as of December 31, 1999 were certified to the Commission as rural carriers,
may elect to pool up to the following amounts:
(A) For a price cap holding company's predominantly non-rural filing
entities ( i.e., filing entities within which more than 50% of all lines are
operated by telephone companies other than those that as of December 31,
1999 were certified to the Commission as rural telephone companies), the
amount of the additional reductions to Average Traffic Sensitive Charge
rates as defined in paragraph (l)(2) of this section, to the extent such
reductions exceed 25% of the Local Switching element revenues (measured in
terms of June 30, 2000 rates times 1999 base period demand);
(B) For a price cap holding company's predominantly rural filing entities (
i.e., filing entities with greater than 50% of lines operated by telephone
companies that as of December 31, 1999 were certified to the Commission as
rural telephone companies), the amount of the additional reductions to
Average Traffic Sensitive Charge rates as defined in paragraph (l)(2) of
this section.
(2) Allocation of Pooled Local Switching Revenue to Certain CMT Elements
(i) The pooled local switching revenue for each filing entity is shifted to
the CMT basket within price caps. Pooled local switching revenue will not be
included in calculations to determine the eligibility for interstate access
universal service funding.
(ii) Pooled local switching revenue will be capped on a revenue per line
basis.
(iii) Pooled local switching revenue is included in the total revenue for
the CMT basket in calculating the X-factor reduction targeted to the traffic
sensitive rate elements, and for companies qualified under paragraph
(m)(1)(i) of this section, to pooled elements after the Average Traffic
Sensitive Charge reaches the target level. For the purpose of targeting
X-factor reductions, companies that allocate pooled local switching revenue
to other filing entities pursuant to paragraph (m)(2)(vii) of this section
shall include pooled local switching revenue in the total revenue of the CMT
basket of the filing entity from which the pooled local switching revenue
originated.
(iv) Pooled local switching revenue shall be kept separate from CMT revenue
in the CMT basket. CMT rate elements for each filing entity shall first be
set based on CMT revenue per line without regard to the presence of pooled
local switching revenue for each filing entity.
(v) If the rates generated without regard to the presence of pooled local
switching revenue for multi-line business PICC and/or multi-line business
SLC are below the nominal caps of $4.31 and $9.20, respectively, pooled
amounts can be added to these rate elements to the extent permitted by the
nominal caps.
(vi) Notwithstanding the provisions of Sec. 69.152(k) of this chapter, pooled
local switching revenue is first added to the multi-line business SLC until
the rate equals the nominal cap ($9.20) or the pooled local switching
revenue is fully allocated. If pooled local switching revenue remains after
applying amounts to the multi-line business SLC, notwithstanding the
provisions of Sec. 69.153 of this chapter, the remaining pooled local switching
revenue may be added to the multi-line business PICC until the rate equals
the nominal cap ($4.31) or the pooled local switching revenue is fully
allocated. Unallocated pooled local switching revenue may still remain. For
companies pooling pursuant to paragraph (m)(1)(i) of this section, these
unallocated amounts may not be recovered from the CCL charge, the primary
residential and single-line business SLC, a non-primary residential SLC, or
from CMT elements in any other filing entity.
(vii) For companies pooling pursuant to paragraph (m)(1)(ii) of this
section, pooled local switching revenue that can not be allocated to the
multi-line business PICC and multi-line business SLC rates within an
individual filing entity may not be recovered from the CCL charge, primary
residential and single-line business SLC or residential/single-line business
SLC charges, but may be allocated to other filing entities within the
holding company, and collected by adding these amounts to the multi-line
business PICC and multi-line business SLC rates. The allocation of pooled
local switching revenue among filing entities will be re-calculated at each
annual filing. In subsequent annual filings, pooled local switching revenue
that was allocated to another filing entity will be reallocated to the
filing entity from where it originated, to the full extent permitted by the
nominal caps of $9.20 and $4.31.
(viii) Notwithstanding the provisions of Sec. 69.152(k) of this chapter, these
unallocated local switching revenues that cannot be recovered fully pursuant
to paragraph (m)(2)(vii) of this section are first added to the multi-line
business SLC of other filing entities until the resulting rate equals the
nominal cap ($9.20) or the pooled local switching revenue for the holding
company is fully allocated. If the pooled local switching revenue can be
fully allocated to the multi-line business SLC, the amount is distributed to
each filing entity with a rate below the nominal cap ($9.20) based on its
below-cap multi-line business SLC revenue as a percentage of the total
holding company's below-cap multi-line business SLC revenue.
(ix) If pooled local switching revenue remains after applying amounts to the
multi-line business SLC of all filing entities in the holding company,
pooled local switching revenue may be added to the multi-line business PICC
of other filing entities. Notwithstanding the provisions of Sec. 69.153 of this
chapter, the remaining pooled local switching revenue is distributed to each
filing entity with a rate below the nominal cap ($4.31) based on its
below-cap multi-line business PICC revenue as a percentage of the total
holding company's below-cap multi-line business PICC revenue.
(x) If pooled local switching revenue is added to the multi-line business
SLC but not to the multi-line business PICC for a filing entity that
qualified to deaverage SLCs without regard to pooled local switching
revenue, the resulting SLC rates can still be deaveraged. Total pooled local
switching revenue is added to the deaveraged zone 1 multi-line business SLC
rate until the per line rate in zone 1 equals the rate in zone 2 or until
the pooled local switching revenue is fully allocated to the deaveraged
multi-line business SLC rate for zone 1. If pooled local switching revenue
remains after the rate in zone 1 equals zone 2, the deaveraged rates of zone
1 and zone 2 are increased until the pooled local switching revenue is fully
allocated to the deaveraged multi-line business SLC rates of zone 1 and 2 or
until those rates reach the zone 3 multi-line business SLC rate level. This
process continues until pooled local switching revenue is fully allocated to
the zone deaveraged rates.
(n) Establishment of the special access basket, effective July 1, 2000.
(1) On the effective date, the PCI value for the special access basket, as
defined in Sec. 61.42(d)(5) shall be equal to the PCI for the trunking basket on
the day preceding the establishment of the special access basket.
(2) On the effective date, the API value for the special access basket, as
defined in Sec. 61.42(d)(5) shall be equal to the API for the trunking basket on
the day preceding the establishment of the special access basket.
(3) Service Category, Subcategory, and Density Zone SBIs and Upper Limits.
(i) Interconnection, Tandem Switched Transport, and Signalling Interconnec-
tion will retain the SBIs and upper limits and remain in the trunking
basket.
(ii) Audio/Video and Wideband will retain the SBIs and upper limits and be
moved into the special access basket.
(iii) For Voice Grade, the SBIs and upper limits in both baskets will be
equal to the SBIs and upper limits in the existing trunking basket on the
day preceding the establishment of the special access basket. Voice Grade
density zones in the trunking basket will retain their indices and upper
limits. Voice Grade density zones will be initialized in the special access
basket when services are first offered in them.
(iv) For High Cap/DDS, DS1, and DS3 category and subcategories, the SBIs and
upper limits in both baskets will be equal to the SBIs and upper limits in
the existing trunking basket on the day preceding the establishment of the
special access basket. SBIs and upper limits for services that are in both
combined density zones and either DTT/EF or special access density zones
will be calculated by using weighted averages of the indices in the affected
zones.
(v) For each DTT/EF-related zone remaining in the trunking basket, the
values will be calculated by taking the sum of the products of the DTT/EF
revenues times the DTT/EF index (or upper limit) and the DTT/EF-related
revenues in the combined zone times the combined index (or upper limit), and
dividing by the total DTT/EF-related revenues for that zone.
(vi) For each special access-related zone in the special access basket, the
values will be calculated by taking the sum of the products of the special
access revenues times the special access index (or upper limit) and the
special access-related revenues in the combined zone times the combined
index (or upper limit), and dividing by the total special access-related
revenues for that zone.
(o) Treatment of acquisitions of exchanges with different ATS Target Rates
as set forth in Sec. 61.3(qq):
(1) In the event that a price cap local exchange carrier acquires a filing
entity or portion thereof from a price cap local exchange carrier after July
1, 2000, and the price cap local exchange carrier did not have a binding and
executed contract to purchase that filing entity or portion thereof as of
April 1, 2000, those properties retain their pre-existing Target Rates as
set forth in Sec. 61.3(qq). If those properties are merged into a filing entity
with a different Target Rate as set forth in Sec. 61.3(qq), the Target Rate as
set forth in Sec. 61.3(qq) for the merged filing entity will be the weighted
average of the Target Rates as set forth in Sec. 61.3(qq) for the properties
being combined into a single filing entity, with the average weighted by
local switching minutes. When a property acquired as a result of a contract
for purchase executed after April 1, 2000 is merged with $0.0095 Target Rate
properties, the obligation to apply price cap reductions to reduce CCL,
pursuant to Sec. 61.45(b)(iii) does not apply to the properties purchased under
contracts executed after April 1, 2000, but continues to apply to the other
properties.
(2) For sale of properties for which a holding company was, as of April 1,
2000, under a binding and executed contract to purchase but which close
after June 30, 2000, but during tariff year 2000, and that are subject to
the $0.0095 Target Rate as set forth in Sec. 61.3(qq), the Average Traffic
Sensitive Rate charged by the purchaser for that property will be the
greater of $0.0095 or the Average Traffic Sensitive Rate for that property.
[ 54 FR 19843 , May 8, 1989, as amended at 55 FR 42384 , Oct. 19, 1990; 56 FR 21617 , May 10, 1991; 56 FR 55239 , Oct. 25, 1991; 59 FR 10302 , Mar. 4, 1994;
60 FR 19528 , Apr. 19, 1995; 60 FR 52346 , Oct. 6, 1995; 62 FR 31932 , June 11,
1997; 64 FR 46590 , Aug. 26, 1999; 65 FR 38699 , June 21, 2000; 65 FR 57742 ,
57743, Sept. 26, 2000]
Goto Section: 61.47 | 61.49
Goto Year: 2007 |
2009
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