PSC 163.04(2)(c)2.b.
b. The commission, with opportunity for hearing, shall establish by order, company-specific benchmarks for each quality of service component based on a consideration of past company performance. A company-specific benchmark is equal to the company's most recent 3-year performance average with respect to a particular quality of service component. For purposes of this subsection, "performance range" means a range 10% above to 10% below a telecommunications utility's average performance over the 3 years preceding the date on which the range is calculated.
PSC 163.04(2)(c)2.c.
c. Data filed under
sub. (1) (b) shall be compared to the industry-wide standards and company-specific benchmarks that apply to the year to which the data relates.
PSC 163.04(2)(c)3.a.
a. A utility may propose an alternative service quality penalty mechanism. Such a proposal shall be filed with the commission before May 1 of the year prior to the year to which the alternative mechanism would first be applied. A utility's proposal shall include proposed components, standards, and weightings, a description of how the penalty percentage is to be calculated based on the performance level, justification for using the alternative service quality penalty mechanism, and a description of how each standard was determined. The commission shall issue an order approving, modifying, or rejecting the proposal before December 1 of the year prior to the year to which the alternative mechanism would first be applied.
PSC 163.04(2)(c)3.b.
b. If approved, the alternative service quality penalty mechanism shall remain in effect unless terminated or modified by the utility or the commission.
PSC 163.04(2)(cd)1.1. When a utility elects price-regulation, it becomes subject to any industry-wide standards for the quality of service components shown in
par. (c) 1. that have already been established by the commission for application to the election year.
PSC 163.04(2)(cd)2.
2. If the commission has not established such industry-wide standards for application to the election year, it shall do so within 30 days of the filing of the utility's investment commitment plan pursuant to s.
196.196 (5), Stats.
PSC 163.04(2)(cd)3.a.
a. Within 30 days of, a utility electing price-regulation, or the establishment of standards under
subd. 2., whichever is later, a utility may propose one or more alternative or additional components for any of the aspects of customer service listed in
par. (c) 1., or alternative industry-wide standards, or both. A utility's proposal for alternative or additional components shall include a description of the alternative or additional component, justification for using this alternative component, and an initial industry-wide standard with a description of how the standard was determined. This filing may also include the weight to be given to each component, if different.
PSC 163.04(2)(cd)3.b.
b. The commission may initiate an investigation of a utility's proposal under
subd. 3. a. within 30 days after receiving the utility's proposal. Within 60 days after initiating an investigation and following an opportunity for hearing, the commission shall issue an order approving, modifying or rejecting the utility's proposal. If a hearing is held, the time within which the commission shall issue an order may be extended by 30 days. If the commission does not initiate an investigation within 30 days after receiving the utility's proposal, the utility's proposal shall be deemed to have been approved.
PSC 163.04(2)(cd)4.
4. Within 30 days of the filing of the utility's investment commitment plan pursuant to s.
196.196 (5), Stats., the commission shall issue an order establishing initial company-specific quality of service benchmarks, component weightings, and measurement timeframes for each quality of service component in
par. (c) 1.
PSC 163.04(2)(ch)1.1. Before December 1 of the year in which industry-wide standards under
par. (cd) are initially applicable, and before December 1 of every year thereafter, the commission shall compute new industry-wide standards based on the prior year's standards, information filed under
sub. (1) (b), national performance data, in-state performance data, and rules or orders regarding quality of service. The commission shall issue an order establishing these new standards in conjunction with the order issued under
subd. 2. or
3., or both, and following an opportunity for hearing. These updated standards shall be applied to the next year and shall be used in calculating the quality of service penalty on the anniversary date following the end of the year to which these standards are applied.
PSC 163.04(2)(ch)2.
2. Before December 1 of the year in which industry-wide standards under
par. (cd) are initially applicable, and before December 1 of every year thereafter, the commission shall compute new company-specific benchmarks based on the prior year's benchmarks, information filed under
sub. (1) (b), and rules or orders regarding quality of service. The commission shall issue an order establishing these new benchmarks in conjunction with the order issued under
subd. 1. or
3., or both, and following an opportunity for hearing. These updated benchmarks shall be applied to the next year and shall be used in calculating the quality of service penalty on the anniversary date following the end of the year to which these benchmarks are applied. For purposes of computing the updated company-specific benchmarks and subject to a showing to the contrary, past performance for the most recent 3-year average shall meet or exceed past performance for the initial 3-year average.
PSC 163.04(2)(ch)3.
3. Before December 1 of the year in which industry-wide standards under
par. (cd) are initially applicable, and before December 1 of every year thereafter, upon a request by the utility or on the commission's own motion, the commission may initiate a review of the appropriateness of the quality of service components in:
s. PSC 163.04 (2) (c) 1., an alternative plan approved under
par. (cd) 3., any applicable order of the commission, or any combination thereof. The commission may issue an order revising these quality of service components, following an opportunity for hearing. If such an order is issued, it shall be issued in conjunction with the order issued under
subd. 1. or
2., or both, whenever possible. These revised components shall be applied to the next year and shall be used in calculating the quality of service penalty on the anniversary date following the end of the year to which these components are applied.
PSC 163.04(2)(cp)
(cp) Service quality penalties. Quality of service penalties shall be calculated as follows:
PSC 163.04(2)(cp)1.a.
a. Actual performance meets industry-wide standards and meets or improves upon company-specific benchmarks.
PSC 163.04(2)(cp)1.b.
b. Actual performance meets industry-wide standards, fails to meet company-specific benchmarks, but meets or improves upon the company's performance range.
PSC 163.04(2)(cp)1.c.
c. During the first 3 years after election of price regulation, actual performance fails to meet industry-wide standards but meets or improves upon company-specific benchmarks.
PSC 163.04(2)(cp)2.
2. A penalty equal to 50% of per component value in Table 1 in
par. (g) shall be assessed if:
PSC 163.04(2)(cp)2.a.
a. After the first 3 years after election of price regulation, actual performance fails to meet industry-wide standards but meets or improves upon company-specific benchmarks.
PSC 163.04(2)(cp)2.b.
b. Actual performance meets industry-wide standards but fails to meet the company's performance range. The commission may waive this penalty in those circumstances where actual performance meets or exceeds customer expectations.
PSC 163.04(2)(cp)2.c.
c. During the first 3 years after election of price regulation, actual performance fails to meet industry-wide standards, fails to meet company-specific benchmarks, but meets or improves upon the company's performance range.
PSC 163.04(2)(cp)3.
3. A penalty equal to 100% of per component value in Table 1 in
par. (g) shall be assessed if:
PSC 163.04(2)(cp)3.a.
a. After the first 3 years after election of price regulation, actual performance fails to meet industry-wide standards and fails to meet company-specific benchmarks.
PSC 163.04(2)(cp)3.b.
b. During the first 3 years after election of price regulation, actual performance fails to meet industry-wide standards and fails to meet the company's performance range.
PSC 163.04(2)(ct)
(ct)
Exceptions. Nothing in this chapter shall preclude special and individual consideration being given to exceptional or unusual situations and upon due investigation of the facts and circumstances involved, the adoption of penalties as to individual providers or components that may be lesser, greater, or different than those provided in
par. (cp).
PSC 163.04(2)(d)
(d) Infrastructure investment incentive and penalty mechanism and components. In creating a penalty or incentive mechanism for infrastructure investment pursuant to s.
196.196 (1) (c), Stats., the commission, with opportunity for hearing, shall establish by order, infrastructure investment components together with benchmark ranges and measurement timeframes for each price-regulated utility. The infrastructure investment components shall be based on all of the following:
PSC 163.04(2)(d)2.
2. The utility's filed infrastructure commitment plan under s.
196.196 (5), Stats., if applicable.
PSC 163.04(2)(d)3.
3. The utility's filed optional infrastructure objectives plan under
par. (dn), if applicable.
PSC 163.04(2)(dc)1.1. The commission shall establish initial infrastructure investment components together with initial benchmark ranges and measurement timeframes within 30 days of the filing of the utility's commitment plan pursuant to s.
196.196 (5), Stats.
PSC 163.04(2)(dc)2.
2. Within 30 days of the commission establishing initial infrastructure investment components, a utility may file one or more proposed alternative or additional infrastructure investment components, component weights, if different, initial benchmarks and measurement timeframes.
PSC 163.04(2)(dc)3.
3. The commission may initiate an investigation of a utility's proposal under
subd. 2. within 30 days after receiving the proposal. Within 60 days after initiating an investigation and following the opportunity for hearing, the commission shall issue an order approving, modifying or rejecting the utility's proposal. If the commission does not initiate an investigation within 30 days after receiving the utility's filing, the utility's proposal shall be deemed to have been approved.
PSC 163.04(2)(dc)4.
4. Initial infrastructure investment components, benchmarks, and measurement timeframes shall be established for use on the utility's first two anniversary dates. Such components, benchmarks, and measurement timeframes, or any combination thereof, may be different for each of the anniversary dates.
PSC 163.04(2)(dg)
(dg) Subsequent mandatory infrastructure investment commitment. During the time when a utility is fulfilling its infrastructure investment commitment under s.
196.196 (5) (a), Stats.
PSC 163.04(2)(dg)1.
1. On each anniversary date following the establishment of initial infrastructure investment components together with benchmark ranges and measurement timeframes under
par. (dc), the commission, following an opportunity for hearing, shall compute new company-specific benchmarks based on the prior year benchmarks and information filed in a utility's report on infrastructure deployment as required under s.
196.196 (5), Stats. These updated benchmarks shall be applied to the next year and shall be used in calculating the penalty or incentive mechanism for infrastructure investment on the anniversary date following the year to which these benchmarks are applied.
PSC 163.04(2)(dg)2.
2. On each anniversary date following the establishment of initial infrastructure investment components together with benchmark ranges and measurement timeframes, upon a request by the utility or on the commission's own motion, the commission may also initiate a review of the appropriateness of the infrastructure investment components. The commission may issue an order revising these infrastructure components, following an opportunity for hearing. These revised components shall be applied to the next year and shall be used in calculating the penalty or incentive mechanism for infrastructure investment on the anniversary date following the end of the year to which these components are applied.
PSC 163.04(2)(dn)1.1. After a utility has fulfilled its infrastructure investment commitment under s.
196.196 (5) (a), Stats., it may, at its option, continue to be eligible for infrastructure incentives and penalties, based on the company's progress in meeting benchmark ranges established in an optional infrastructure investment objectives plan.
PSC 163.04(2)(dn)2.
2. If a utility that has fulfilled its infrastructure investment commitment under s.
196.196 (5), Stats., wishes to be eligible for an infrastructure incentive or penalty based on Table 1 in
par. (g), it shall file, on or before March 1 of the plan year, a proposed infrastructure investment objectives plan. The plan shall include benchmark ranges proposed to be applied to that year. Objectives for both retail-related and wholesale-related infrastructure investments shall be included in the proposal. The commission shall review the reasonableness of the proposed benchmark ranges and may approve or modify them. The approved infrastructure investment components, benchmark ranges, and measurement timeframes shall be used in calculating the penalty or incentive mechanism for infrastructure investment on the anniversary date following the end of the year to which they are applied. These benchmark ranges shall provide incentives for improvements for which the utility would otherwise have few economic investment incentives. The improvements may include, but are not limited to, investments which improve or promote the following:
PSC 163.04(2)(dn)3.
3. If a utility that has fulfilled its infrastructure investment commitment under s.
196.196 (5), Stats., does not file, on or before March 1 of the plan year, a proposed infrastructure investment objectives plan, the incentive, penalty and total maximum values in Table 1 of
par. (g) shall be adjusted as indicated in that table.
PSC 163.04(2)(dr)
(dr) Infrastructure investment penalties and incentives. If the reported investment associated with a component is outside the benchmark range, then the annual component will be assigned an appropriately weighted penalty or incentive value based on Table 1 in
par. (g). The range may be based on cumulative investment levels.
PSC 163.04(2)(dw)
(dw)
Exceptions. Nothing in this chapter shall preclude special and individual consideration being given to exceptional or unusual situations and upon due investigation of the facts and circumstances involved, the waiving of all or a portion of any infrastructure investment penalty as to individual providers.
PSC 163.04(2)(f)
(f)
Discretionary penalty and incentives. In addition to the penalty and incentives under
pars. (c) to
(d), the commission may also assign, at its discretion, an additional penalty or incentive, which is shown in Table 1.
PSC 163.04(2)(f)1.
1. To determine a discretionary penalty, the factors the commission may consider to the extent they relate to the utility's infrastructure investment and quality of service, include but are not limited to:
PSC 163.04(2)(f)1.b.
b. Customer satisfaction as measured by customer surveys and customer complaints.
PSC 163.04(2)(f)1.c.
c. Responsiveness to rural development and technology concerns, and demand for new services.
PSC 163.04(2)(f)1.d.
d. The extent to which the utility has reasonably complied with its annual commitment or objectives defined in its infrastructure investment plan.
PSC 163.04(2)(f)1.e.
e. The extent to which schools, libraries, hospitals and similar institutions are utilizing the utility's infrastructure investments.
PSC 163.04(2)(f)1.f.
f. The extent to which the utility has established and the effectiveness of customer assistance programs.
PSC 163.04(2)(f)1.g.
g. Compliance with other measures or standards for telecommunications service included in rules or orders, but not included in the quality of service penalty components set forth in this subsection.
PSC 163.04(2)(f)1.h.
h. The extent to which the utility has established and the effectiveness of programs to keep consumers knowledgeable concerning prices, options, features, rights, changes, and the availability of more detailed information.
PSC 163.04(2)(f)2.
2. To determine a discretionary incentive, the factors the commission may consider to the extent they relate to the utility's infrastructure investment, include but are not limited to:
PSC 163.04(2)(f)2.b.
b. Customer satisfaction as measured by customer surveys and customer complaints.
PSC 163.04(2)(f)2.c.
c. Responsiveness to rural development and technology concerns, and demand for new services.
PSC 163.04(2)(f)2.d.
d. The extent to which the utility has reasonably complied with its annual commitment or objectives defined in its infrastructure investment plan.
PSC 163.04(2)(f)2.e.
e. The extent to which schools, libraries, hospitals and similar institutions are utilizing the utility's infrastructure investments.
PSC 163.04(2)(g)
(g) Maximum total penalty and incentive values. The following table shows the maximum penalty or incentive values to be assigned to a price-regulated utility based on quality of service, infrastructure investment and commission discretion.
-
See PDF for table 
2If a utility has fulfilled its infrastructure investment commitment pursuant to s. 196.196 (5) (a)
, Stats., and does not file an optional infrastructure objectives plan under sub. (2) (dn) 2., the infrastructure investment penalty value shown above shall be added to the penalty value assigned to quality of service and the infrastructure investment penalty shall be set at zero. The infrastructure investment incentive shall be set at zero and the total maximum incentive value shall be decreased by the maximum infrastructure investment incentive value shown above.
PSC 163.04(3)
(3) Calculating the unadjusted cumulative PCI. At the effective date of election of price regulation the unadjusted cumulative PCI shall be initialized at 100. On the third anniversary date, the unadjusted cumulative PCI shall be equal to the annual PCI. On all other anniversary dates, the unadjusted cumulative PCI shall be calculated by the commission using the following formula:
-
See PDF for table PSC 163.04(4)
(4) Calculating the 3-year maximum PCI. At the effective date of election of price regulation, on the third anniversary date, upon implementation of any rate decrease required by this section, and any time a rate increase causes the annual API to exceed the annual PCI, the 3-year maximum PCI shall be initialized at 100. On each anniversary date, the 3-year maximum PCI shall be calculated by the commission using the following formula:
-
See PDF for table PSC 163.04(5)(a)(a) At the effective date of election of price regulation, and at every anniversary date, the annual API shall be initialized at 100. The annual API shall be changed for each increase or decrease in a price for a price-regulated service, according to the following formula:
-
See PDF for table PSC 163.04(5)(b)
(b) Revenue weights shall be calculated on the first anniversary date as set forth in
sub. (1) (a), and reviewed on each subsequent anniversary date. If additional price-regulated services are added pursuant to s.
196.196 (1) (a) 2., Stats., the annual API shall be calculated so that the addition of these services shall not cause a change in the annual API.
PSC 163.04(5)(c)
(c) The annual API shall exclude any price decreases ordered by the commission under s.
196.196 (5) (e), Stats.
PSC 163.04(6)
(6) Calculating the unadjusted cumulative api. At the effective date of election of price regulation the unadjusted cumulative API shall be initialized at 100. On the third anniversary date, the unadjusted cumulative API shall be equal to the annual API. On all other applicable dates, the unadjusted cumulative API shall be calculated using the following formula:
-
See PDF for table PSC 163.04(7)
(7) Calculating the 3-year maximum api. At the effective date of election of price regulation, on the third anniversary date, upon implementation of any rate decreases required by this section, and at any time a rate increase causes the annual API to exceed the annual PCI, the 3-year maximum API shall be initialized at 100. On all other applicable dates, the 3-year maximum API shall be calculated using the following formula:
-
See PDF for table PSC 163.04(8)(a)(a) The commission shall issue an order no later than 60 days after the utility's anniversary date authorizing the amount the utility may increase its rates or mandating the amount it shall reduce them based on the calculated PCI. If a hearing is held, the time within which the commission shall issue an order may be extended by 60 days. The order shall set forth the PCI and API values as of the anniversary date. Once the commission issues an order authorizing the change, the utility shall have until the next anniversary date to raise its prices by the amount the 3-year maximum PCI exceeds the 3-year maximum API. The increase in any rate element shall not at any time exceed 10% or the annual change in the GDPPI index, whichever is greater. The commission's order may also set the revenue weights for calculating the API. If the utility elects to increase rates, it shall file with the commission tariffs implementing the increase. It shall also file a calculation of the annual API, unadjusted cumulative API and 3-year maximum API which results after an increase in rates. Any such increase shall become effective 45 days after the date on which notice is received by the commission, unless the commission determines it is in violation of the authorized increase. If the 3-year maximum PCI is less than the 3-year maximum API, and the unadjusted cumulative PCI is less than the unadjusted cumulative API, the utility shall file tariffs implementing the decrease. Any such decrease shall become effective no later than 45 days after the date of the commission order mandating the decrease unless the commission determines it is in violation of the authorized decrease. The utility shall also file a calculation of the annual API, unadjusted cumulative API, and 3-year maximum API which result after such decrease. The resulting unadjusted cumulative API shall be no greater than the unadjusted cumulative PCI.
PSC 163.04(8)(b)
(b) Under s.
196.196 (1) (c), Stats., the only service specified by s.
196.196 (1) (a), Stats., for which prices may be increased during the first 3 years after the utility's initial price-regulated rates take effect is basic message telecommunications service. For any price change during the initial 3-year period after a utility elects price regulation, the API shall only include basic message telecommunications service.
PSC 163.04 History
History: Cr.
Register, October, 1995, No. 478, eff. 11-1-95;
CR 00-184: am. (1) (c), (2) (a), (bm), (g) and Table 1, (8) (a), renum. (2) (c) 1. to be (2) (c) 2. a., 3. to be (2) (cd) 3. a. 4. to be (2) (cd) 3. b., 5. to be (2) (c) 2. b., 6. (intro.) to be (2) (cp) 1. (intro.), a. to c. to be (2) (cp) 1. a. to c. 7. (intro) to be (2) (cp) 2. (intro.), 7. a. to be (2) (cp) 2. a., 7. b. to be (2) (cp) 2. b., 7. c. to be (2) (cp) 2. c. 8. (intro.) to be (2) (cp) 3. (intro.), 8. a. to be (2) (cp) 3. a., 8. b. to be (2) (cp) 3. b., 10. to be (2) (ch) 2., (2) (d) 1 to 4. to be (2) (d) and (dc) 1. to 3., 5. to be (2) (dr), 7. to be (2) (dg) 1., r. (2) (c) 2. and 9., (d) 6., (e), cr. (2) (c) 1., 2. (intro.), c., 3., (2) (cd), 1. to 3. (intro.), 4., (2) (ch) 1., 3., (2) (cp) (intro.), (2) (ct), (2) (dc) 4., (2) (dg) (intro.), 2., (dn) 1. to 3., (dw), r. and recr. (2) (f),
Register March 2002 No. 555, eff. 4-1-02; reprinted to restore dropped copy in (7)
Register August 2005 No. 596.
PSC 163.05
PSC 163.05
Rate increases and rate structure changes independent of the price cap index. PSC 163.05(1)
(1) Under s.
196.196 (1) (e) 1., Stats., a price-regulated telecommunications utility, not earlier than 3 years after electing to become price-regulated, may alter its rate structure or increase rates for price-regulated services upon 120 days' prior notice to the commission. Under s.
196.196 (1) (e) 2., Stats., the commission upon a complaint by an affected party or on its own motion, may initiate an investigation. Within 120 days after initiating the investigation and following a hearing, the commission shall issue an order approving, modifying or rejecting the rate change.
PSC 163.05(2)
(2) The API and PCI as set forth in
s. PSC 163.04 (2) through
(7), shall be reinitialized to 100 upon any rate increase or rate structure change in this section that results in the 3-year maximum API exceeding the 3-year maximum PCI.
PSC 163.05(3)
(3) The notice required under s.
196.196 (1) (e), Stats., for a price-regulated telecommunications utility to change its rate structure or increase rates for price-regulated services shall be accompanied with the following information:
PSC 163.05(3)(a)
(a) Documentation that addresses the factors specified in s.
196.03 (6), Stats., for determining what is just and reasonable, and the impact of the proposed change on the public interest.
PSC 163.05(3)(b)
(b) A cost of service study supporting a change in rates above those allowed in s.
196.196 (1) (c), Stats. The cost of service study shall demonstrate that the cost of providing one or more price-regulated services, and all price-regulated services in the aggregate, have increased due to cost allocations or changes in the costs of providing that service that are outside the control of the telecommunications utility and the change in cost will not be fully offset by resulting changes in the GDPPI.
PSC 163.05(3)(c)
(c) If the rate change is based on changes in the allocation of costs outside of the control of the telecommunications utility, documentation shall include a description of the change in cost allocation methods, when management became aware of the change, the impact of the change on both the profitability of total company operations and the cost of providing price-regulated services, other steps taken by the utility to mitigate the impact of the change, and evidence that the change will disproportionately impact that utility with respect to other providers or carriers.
