§  54.311   Interim hold-harmless support for non-rural carriers.

   (a) Interim hold-harmless support. The total amount of interim
   hold-harmless support provided to a non-rural incumbent local exchange
   carrier shall equal the amount of support calculated for that carrier
   pursuant to part 36 of this chapter. The total amount of interim
   hold-harmless support provided to a non-rural incumbent local exchange
   carrier shall also include Long Term Support provided pursuant to
   § 54.303, to the extent that the carrier would otherwise be eligible for
   such support. Beginning on January 1, 2000, in the event that a State's
   statewide average FLEC per line, calculated pursuant to § 54.309(a),
   does not exceed the national cost benchmark, non-rural incumbent local
   exchange carriers in such State shall receive interim hold-harmless
   support calculated pursuant to part 36, and, if applicable, § 54.303. In
   the event that a State's statewide average FLEC per line, calculated
   pursuant to § 54.309(a), exceeds the national cost benchmark, but the
   amount of support that would be provided to a non-rural incumbent local
   exchange carrier in such State pursuant to § 54.309(b) is less than the
   amount that would be provided pursuant to part 36 and, if applicable,
   § 54.303, the carrier shall be eligible for support pursuant to part 36
   and, if applicable, § 54.303. To the extent that an eligible
   telecommunications carrier serves lines in the service area of a
   non-rural incumbent local exchange carrier receiving interim
   hold-harmless support, the eligible telecommunications carrier shall
   also be entitled to interim hold-harmless support in an amount per line
   equal to the amount per line provided to the non-rural incumbent local
   exchange carrier pursuant to paragraph (b) of this section.

   (b) Distribution of Interim Hold-Harmless Support Amounts. Until the
   third quarter of 2000, interim hold-harmless support shall be
   distributed pursuant to part 36 and, if applicable, § 54.303 of this
   subpart. Beginning in the third quarter of 2000, the total amount of
   interim hold-harmless support provided to each non-rural incumbent
   local exchange carrier within a particular State pursuant to paragraph
   (a) shall be distributed first to the carrier's wire center with the
   highest wire center average FLEC per line until that wire center's
   average FLEC per line, net of support, equals the average FLEC per line
   in the second most high-cost wire center. Support shall then be
   distributed to the carrier's wire center with the highest and second
   highest wire center average FLEC per line until those wire center's
   average FLECs per line, net of support, equal the average FLEC per line
   in the third most high-cost wire center. This process shall continue in
   a cascading fashion until all of the interim hold-harmless support
   provided to the carrier has been exhausted.

   (c) Petition for waiver. Pursuant to section 1.3 of this chapter, a
   State may file a petition for waiver of paragraph (b) of this section,
   asking the Commission to distribute interim hold-harmless support to a
   geographic area different than the wire center. Such petition must
   contain a description of the particular geographic level to which the
   State desires interim hold-harmless support to be distributed, and an
   explanation of how waiver of paragraph (b) of this section will further
   the preservation and advancement of universal service within the State.

   (d) Phase down of interim hold-harmless support. Beginning January 1,
   2001, the interim hold-harmless support for which a non-rural incumbent
   local exchange carrier qualifies under paragraph (a) of this section,
   excluding Long Term Support, shall be phased down through annual $1.00
   reductions in average monthly, per-line support. Applicable annual
   reductions shall be subtracted from the total amount of interim
   hold-harmless support that a non-rural incumbent local exchange carrier
   otherwise would be eligible to receive on an ongoing, quarterly basis.
   The provisions of paragraph (b) of this section shall apply to the
   total amount of phased-down interim hold-harmless support provided to
   each non-rural incumbent local exchange carrier.

   (1) Interim hold-harmless support for a wire center transferred to a
   carrier that does not meet the definition of rural telephone company in
   § 51.5 of this chapter shall be phased down following the transfer over
   the same time period as the seller's support would have been phased
   down, by an equal percentage for each year of the phase-down period.

   (2) Interim hold-harmless support for a wire center transferred to a
   carrier that meets the definition of rural telephone company in § 51.5
   of this chapter shall remain frozen at the per-line support level as of
   the sale date.

   [ 64 FR 67432 , Dec. 1, 1999, as amended at  64 FR 73428 , Dec. 30, 1999;
    65 FR 78992 , Dec. 18, 2000]