Section 275.6 Of Chapter 1.5. Advisory Boards From California Public Utilities Code >> Division 1. >> Part 1. >> Chapter 1.5.
275.6
. (a) The commission shall exercise its regulatory authority
to maintain the California High-Cost Fund-A Administrative Committee
Fund program (CHCF-A program) to provide universal service rate
support to small independent telephone corporations in amounts
sufficient to meet the revenue requirements established by the
commission through rate-of-return regulation in furtherance of the
state's universal service commitment to the continued affordability
and widespread availability of safe, reliable, high-quality
communications services in rural areas of the state.
(b) For purposes of this section, the following terms have the
following meanings:
(1) "Carrier of last resort" means a telephone corporation that is
required to fulfill all reasonable requests for service within its
service territory.
(2) "Rate base" means the value of a telephone corporation's plant
and equipment that is reasonably necessary to provide regulated
voice services and access to advanced services, and upon which the
telephone corporation is entitled to a fair opportunity to earn a
reasonable rate of return.
(3) "Rate design" means the mix of end user rates, high-cost
support, and other revenue sources that are targeted to provide a
fair opportunity to meet the revenue requirement of the telephone
corporation.
(4) "Rate-of-return regulation" means a regulatory structure
whereby the commission establishes a telephone corporation's revenue
requirements, and then fashions a rate design to provide the company
a fair opportunity to meet the revenue requirement.
(5) "Revenue requirement" means the amount that is necessary for a
telephone corporation to recover its reasonable expenses and tax
liabilities and earn a reasonable rate of return on its rate base.
(6) "Small independent telephone corporations" are rural incumbent
local exchange carriers subject to commission regulation.
(c) In administering the CHCF-A program the commission shall do
all of the following:
(1) Continue to set rates to be charged by the small independent
telephone corporations in accordance with Sections 451, 454, 455, and
728.
(2) Employ rate-of-return regulation to determine a small
independent telephone corporation's revenue requirement in a manner
that provides revenues and earnings sufficient to allow the telephone
corporation to deliver safe, reliable, high-quality voice
communication service and fulfill its obligations as a carrier of
last resort in its service territory, and to afford the telephone
corporation a fair opportunity to earn a reasonable return on its
investments, attract capital for investment on reasonable terms, and
ensure the financial integrity of the telephone corporation.
(3) Ensure that rates charged to customers of small independent
telephone corporations are just and reasonable and are reasonably
comparable to rates charged to customers of urban telephone
corporations.
(4) Provide universal service rate support from the California
High-Cost Fund-A Administrative Committee Fund to small independent
telephone corporations in an amount sufficient to supply the portion
of the revenue requirement that cannot reasonably be provided by the
customers of each small independent telephone corporation after
receipt of federal universal service rate support.
(5) Promote customer access to advanced services and deployment of
broadband-capable facilities in rural areas that is reasonably
comparable to that in urban areas, consistent with national
communications policy.
(6) Include all reasonable investments necessary to provide for
the delivery of high-quality voice communication services and the
deployment of broadband-capable facilities in the rate base of small
independent telephone corporations.
(7) Ensure that support is not excessive so that the burden on all
contributors to the CHCF-A program is limited.
(d) In order to participate in the CHCF-A program, a small
independent telephone corporation shall meet all of the following
requirements:
(1) Be subject to rate-of-return regulation.
(2) Be subject to the commission's regulation of telephone
corporations pursuant to this division.
(3) Be a carrier of last resort in their service territory.
(4) Qualify as a rural telephone company under federal law (47
U.S.C. Sec. 153(44)).
(e) Upon request from the commission, a small independent
telephone corporation that receives support from the CHCF-A program
shall provide information regarding revenues derived from the
provision of unregulated Internet access service by that corporation
or its affiliate within that corporation's telephone service
territory. The commission shall treat as confidential any information
provided pursuant to this subdivision.
(f) The commission shall structure the CHCF-A program so that any
charge imposed to promote the goals of universal service reasonably
equals the value of the benefits of universal service to contributing
entities and their subscribers.
(g) This section shall remain in effect only until January 1,
2019, and as of that date is repealed, unless a later enacted
statute, that is enacted before January 1, 2019, deletes or extends
that date.