JR1 SB13: Bill Text

The bill imposes requirements on intrastate switched access rates that depend on whether a telecommunications provider is a large or small ILEC, new nonincumbent, or large or small nonincumbent, as defined in the bill. The bill defines "switched access rates" as rates charged for providing switched access to a local exchange network for enabling the origination or termination of telecommunications service within the local exchange. In general, federal law provides that the Federal Communications Commission regulates interstate rates and the states regulate intrastate rates.

Large ILECs. The bill defines "large ILEC" as an ILEC that, with any ILEC affiliates, had 150,000 or more access lines in this state as of January 1, 2010. No later than two years after the bill's effective date, a large ILEC must reduce its intrastate switched access rates by an amount equal to 25 percent of the difference between its intrastate and interstate switched access rates. No later than three years after the bill's effective date, a large ILEC must further reduce its intrastate switched access rates by an amount equal to 33 percent of the difference between its intrastate and interstate switched access rates. No later than four years after the bill's effective date, a large ILEC must further reduce its intrastate switched access rates by an amount equal to 50 percent of the difference between its intrastate and interstate switched access rates. No later than five years after the bill's effective date, a large ILEC must further reduce its intrastate switched access rates to mirror its interstate switched access rates and, beginning on that date, may not charge intrastate switched access rates that are higher than its interstate switched access rates.

New nonincumbents. The bill defines "new nonincumbent" as a telecommunications provider that is not an ILEC and that was initially certified as a TU or an ATU on or after January 1, 2011, except that "new nonincumbent" does not include an ATU that was formerly certified as a TU. Within 30 days after the bill's effective date, the bill prohibits a new nonincumbent from charging intrastate switched access rates that are higher than its interstate switched access rates.

Large nonincumbents. The bill defines "large nonincumbent" as a telecommunications provider, other than an ILEC, that had 10,000 or more access lines in the state as of January 1, 2010, and that was initially certified as a TU or an ATU before January 1, 2011. The bill prohibits a large nonincumbent from charging intrastate switched access rates that are higher than the rates it charged on January 1, 2011, except for increases that result in mirroring interstate switched access rates. No later than four years after the bill's effective date, a large nonincumbent must reduce its intrastate switched access rates by an amount equal to 33 percent of the difference between its intrastate and interstate switched access rates. No later than five years after the bill's effective date, a large nonincumbent must further reduce its intrastate switched access rates by an amount equal to 50 percent of the difference between its intrastate and interstate switched access rates. No later than six years after the bill's effective date, a large nonincumbent must further reduce its intrastate switched access rates to mirror its interstate switched access rates and, beginning on that date, may not charge intrastate rates that are higher than its interstate rates.

Other requirements. The bill provides that, except to enforce the above requirements, the PSC may not investigate, review, or set intrastate switched access rates for large ILECs, new nonincumbents, or large nonincumbents. Also, during the four-year period beginning on the bill's effective date, the PSC is prohibited from investigating, reviewing, or setting the intrastate switched access rates of a "small ILEC," which the bill defines as an ILEC that, with any ILEC affiliates, had fewer than 150,000 access lines in this state as of January 1, 2010. In addition, during the three-year period beginning on the bill's effective date, the PSC is prohibited from doing the same with respect to a "small nonincumbent," which the bill defines as a telecommunications provider, other than an ILEC, that had fewer than 10,000 access lines in the state as of January 1, 2010, and that was initially certified as a TU or an ATU before January 1, 2011. However, the bill allows the PSC to enforce reductions in intrastate switched access rates ordered by the PSC prior to the bill's effective date. Also, the bill allows the PSC to approve certain increases in intrastate switched access rates that are included in tariff revisions, which are discussed below.

Tariffs

In general. The bill allows, but does not require, a TU or an ATU to do any of the following: 1) retain on file with the PSC tariffs showing the service rates, tolls, and charges the TU or ATU has established for some or all services that the TU or ATU performs in the state; 2) file new tariffs with the PSC for some or all of such services; 3) withdraw tariffs for any service, except for intrastate switched access service; and 4) file revised tariffs that change the rates, tolls, charges, or terms and conditions under tariffs on file with the PSC. Except for changes that constitute increases in intrastate switched access rates, tariff revisions are effective at the time specified in the revised tariff as filed with the PSC. Except for new tariffs for intrastate switched access services, a new tariff is effective on the date specified in the tariff, unless the PSC, within ten days after the new tariff is filed, suspends the new tariff. If the PSC suspends a new tariff, the PSC may modify the new tariff only to the extent that the new tariff violates certain requirements that apply to the TU or ATU, and only after granting the TU or ATU an opportunity for a hearing. If the PSC fails to modify the new tariff within deadlines specified in the bill, the new tariff is effective as filed.

The bill also allows a tariff for a service that permits a TU or an ATU to enter into an individual contract with an individual customer under rates, terms, or conditions that are different from those specified for the service in the tariff. Except for such an individual contract, the bill prohibits a TU or an ATU from receiving for a service more or less compensation than that specified for the service in a tariff, and prohibits a TU or an ATU from receiving compensation for a service that is not specified in a tariff. Also, copies of tariffs filed under the bill must be made available to consumers in a form and place readily accessible to the public.

Intrastate switched access service. No later than 90 days after the bill's effective date, a TU or an ATU that provides intrastate switched access service must have on file with the PSC a tariff showing the rates, tolls, and charges for the service. The bill provides that the absence of such a tariff before that deadline does not prohibit a TU or an ATU from charging intrastate switched access rates that comply with the requirements for intrastate switched access rates described above or that are charged pursuant to a prior order of the PSC. If a TU or an ATU must file a new tariff to comply with the foregoing requirement, and the tariff includes intrastate switched access rates that are higher than the rates the TU or ATU charged on January 1, 2011, the PSC must approve the tariff, unless certain exceptions are satisfied.

The PSC is authorized to enforce payment of rates specified in a tariff for intrastate switched access rates. Once such a tariff is in effect, the bill prohibits a TU or an ATU from withdrawing the tariff. However, under certain circumstances, a TU or an ATU may revise the tariff to increase intrastate switched access rates. The PSC must approve the increase, except for certain specified increases that are effective at the time specified in a revised tariff.

Interconnected VOIP service

With certain exceptions, the bill provides that interconnected VOIP service is exempt from PSC regulation. Under the bill, "interconnected VOIP service" has the same meaning as under federal law, which is a service requiring a broadband connection and Internet protocol-compatible customer premises equipment that allows the user to engage in real-time, two-way communication over the public switched telephone network.

One exception to the exemption is that an entity that provides interconnected VOIP service must make contributions to the state's universal service fund based on the entity's revenues from providing intrastate interconnected VOIP service. The bill specifies the methods for calculating such revenues. Under the other exceptions to the exemption, a provider of interconnected VOIP service must do the following, which apply to other telecommunications providers under current law: 1) impose a monthly police and fire protection fee on its customers; 2) pay assessments for DATCP enforcement of certain consumer protection requirements; and 3) pay assessments for a statewide telecommunications relay service. In addition, interconnected VOIP service is subject to the PSC's authority over interconnection agreements under current law. The bill also provides that, unless otherwise provided under federal law, an entity that provides interconnected VOIP service must pay intrastate switched access rates. Also, unless otherwise provided under federal law, if the entity provides intrastate switched access service in connection with the interconnected VOIP service, the entity is allowed to charge intrastate switched access rates for the service.

Universal service

Under current law, the state's universal service fund is used for, among other things, supporting programs that promote access to essential and advanced telecommunications services. Current law requires the PSC to promulgate rules that define the essential and advanced telecommunications services that must be available to all customers at affordable prices as a necessary component of universal service. The essential and advanced telecommunications services must be based on market, social, economic development, and infrastructure development principles rather than on specific technologies or providers.

This bill repeals the foregoing requirements regarding PSC rules and requires instead that certain telecommunications providers make available to their customers all essential telecommunications services. In addition, the bill eliminates advanced telecommunications services from the programs supported by the state's universal service fund. The bill defines "essential telecommunications services" as services or functionalities listed in a regulation by the Federal Communications Commission as of January 1, 2010. The bill's requirements apply to a telecommunications provider that is designated under federal law as a telecommunications carrier eligible to receive support from the federal universal service fund. Also, the bill provides that a telecommunications provider may provide essential telecommunications services itself or through an affiliate or through the use of any available technology or mode. In addition, the bill limits the requirements that the PSC may impose on a wireless telecommunications provider that receives support from the federal universal service fund but does not receive support from the state's universal service fund.

Basic voice service

The bill requires an ILEC to make basic voice service available to all residential customers within the ILEC's local exchange area. "Basic voice service" is defined, in part, as two-way voice communication service within a local calling area. The bill allows an ILEC to provide basic voice service through an affiliate or through the use of any available technology or mode.

The bill also allows an ILEC to apply to the PSC for a waiver from the foregoing requirements. The PSC must grant a waiver if the waiver is in the public interest or effective competition exists in the local exchange area. If the PSC fails to meet a 120-day deadline for the waiver request, the waiver request is considered granted by operation of law. In addition, the PSC must grant a waiver if the PSC previously found that effective competition existed. However, the PSC may not grant a waiver based on a previous finding of effective competition until after June 1, 2012. If the PSC fails to meet a 20-day deadline for a waiver request based on a previous finding of effective competition, the waiver request is considered granted by operation of law. The bill also provides that decisions of the PSC prior to the effective date of the bill that eliminate an ILEC's provider of last-resort obligations remain in force and effect. Finally, the bill provides that none of the bill's basic voice service requirements apply after April 30, 2013.

Use of transmission equipment and property

Current law requires any person who owns transmission equipment and property to permit, for reasonable compensation, a public utility or telecommunications provider to use the equipment and property, if certain requirements are satisfied. Current law defines "transmission equipment and property" to include any conduit, subway, pole, tower, transmission wire, or other equipment, that is on, over, or under any street or highway. The PSC is authorized to resolve disputes regarding such uses of transmission equipment and property, and may prescribe reasonable conditions and compensation for such uses.

This bill defines "transmission equipment and property" so that it also includes any equipment and property that is on, over, or under any right-of-way owned or controlled by a county, city, village, or town or public utility owned or operated by any county, city, village, or town. In addition, the bill allows a person granted a video service or cable television franchise under current law, in addition to a public utility or telecommunications provider, to use transmission equipment and property under the foregoing conditions. Also, the bill specifies that pole attachments constitute transmission equipment and property that are subject to the foregoing requirements.

Other changes

The bill makes other changes to telecommunications regulation, including the following:

1. The bill eliminates the conveyance of data or other information from the definition of "telecommunications service" for purposes of the statutes administered by the PSC and certain other statutes. As a result, the definition is limited to the conveyance of voice communication, except that the bill also specifies that the definition includes switched access service.

2. Under current law, a company that provides telecommunications service may, subject to municipal regulation and PSC review, maintain lines within public rights-of-way. Current law does not define "telecommunications service" for this purpose. The bill defines "telecommunications service" for this purpose to include the conveyance of voice communication, data, or other information.

3. The bill eliminates a prohibition under current law against TUs and other telecommunications providers from giving certain preferences to their consumer retail departments or affiliates.

4. The bill eliminates certain requirements under current law that apply to certain telecommunications providers regarding issuance of securities, capital structure, and payment of dividends.

5. The bill exempts telecommunications providers from the PSC's authority to require public utilities to answer questionnaires and provide certain documents to the PSC, and the bill clarifies that the PSC's authority to require telecommunications providers to answer questionnaires applies only to matters within the PSC's jurisdiction.

For further information see the state fiscal estimate, which will be printed as an appendix to this bill.

The people of the state of Wisconsin, represented in senate and assembly, do enact as follows:

SB13, s. 1 Section 1. 20.155 (1) (q) of the statutes is amended to read:

SB13,10,5 20.155 (1) (q) Universal telecommunications service. From the universal service fund, the amounts in the schedule for the promotion of universal telecommunications service for the purposes specified in s. 196.218 (5) (a) 1. to, 4., 8. and 9.

SB13, s. 2 Section 2. 93.01 (1m) of the statutes is amended to read:

SB13,11,9 93.01 (1m) "Business" includes any business, except that of banks, savings banks, credit unions, savings and loan associations, and insurance companies. "Business" includes public utilities and telecommunications carriers to the extent that their activities, beyond registration, notice, and reporting activities, are not regulated by the public service commission and includes public utility and telecommunications carrier methods of competition or trade and advertising practices that are exempt from regulation by the public service commission under s. 196.195, 196.196, 196.202, 196.203, 196.206, 196.219, or 196.499, or 196.50 (2) (i) or by other action of the commission.

SB13, s. 3 Section 3. 133.07 (2) of the statutes is amended to read:

SB13,11,18 133.07 (2) This chapter does not prohibit activities of any public utility, as defined in s. 196.01 (5), or telecommunications carrier, as defined in s. 196.01 (8m), which are required by ch. 196 or rules or orders under ch. 196, activities necessary to comply with that chapter or those rules or orders or activities that are actively supervised by the public service commission. This subsection does not apply to activities of a public utility or telecommunications carrier that are exempt from public service commission regulation under s. 196.195, 196.196, 196.202, 196.203, 196.206, 196.219 or, 196.499, or 196.50 (2) (i) or by other action by the commission.

SB13, s. 4 Section 4. 182.017 (1g) (cq) of the statutes is created to read:

SB13,11,23 182.017 (1g) (cq) "Telecommunications service" means the offering for sale of the conveyance of voice, data, or other information, including the sale of service for collection, storage, forwarding, switching, and delivery incidental to such communication regardless of the technology or mode used to make such offering.

SB13, s. 5 Section 5. 196.01 (1d) (g) of the statutes is created to read:

SB13,12,2 196.01 (1d) (g) A telecommunications utility certified under s. 196.203 pursuant to s. 196.50 (2) (j) 1. a.

SB13, s. 6 Section 6. 196.01 (2s) of the statutes is created to read:

SB13,12,5 196.01 (2s) "Incumbent local exchange carrier" has the meaning given in 47 USC 251 (h).

SB13, s. 7 Section 7. 196.01 (3a) of the statutes is created to read:

SB13,12,8 196.01 (3a) "Interconnected voice over Internet protocol service" has the meaning given in 47 CFR 9.3.

SB13, s. 8 Section 8. 196.01 (8d) of the statutes is created to read:

SB13,12,12 196.01 (8d) "Switched access rates" means the rates, rate elements, and rate structure, including all applicable fixed and traffic sensitive charges, that a telecommunications provider charges for the provision of switched access services.

SB13, s. 9 Section 9. 196.01 (8e) of the statutes is created to read:

SB13,12,16 196.01 (8e) "Switched access service" means the offering of switched access to a local exchange network for the purpose of enabling an entity to originate or terminate telecommunications service within the local exchange.

SB13, s. 10 Section 10. 196.01 (9m) of the statutes is amended to read:

SB13,12,25 196.01 (9m) "Telecommunications service" means the offering for sale of the conveyance of voice, data or other information at any frequency over any part of the electromagnetic spectrum communication, including the sale of service for collection, storage, forwarding, switching, and delivery incidental to such communication and including the regulated sale of customer premises equipment, regardless of the technology or mode used to make such offering. "Telecommunications service" includes switched access service. "Telecommunications service" does not include cable service or broadcast service.

SB13, s. 11 Section 11. 196.01 (12w) of the statutes is created to read:

SB13,13,3 196.01 (12w) (a) "Wholesale telecommunications service" means, except as provided in par. (b), a service that satisfies all of the following:

SB13,13,5 1. The service is provided by a telecommunications provider to another telecommunications provider other than an affiliate, as defined in s. 196.212 (1) (a).

SB13,13,6 2. The service is subject to regulation by the commission under this chapter.

SB13,13,8 3. The service is subsequently used in the provision of a telecommunications service to retail end users.

SB13,13,10 (b) "Wholesale telecommunications service" does not include switched access service.

SB13, s. 12 Section 12. 196.016 of the statutes is created to read:

SB13,13,17 196.016 Relationship to certain federal telecommunications law. Except as provided in s. 196.50 (2) (j) 2. and 3., nothing in this chapter is intended to either reduce or expand the scope and application of the federal Telecommunications Act of 1996, P.L. 104-104, including the jurisdiction and authority granted to the commission thereunder, and the commission may take any action that the commission is authorized to take under that federal act.

SB13, s. 13 Section 13. 196.02 (2) of the statutes is amended to read:

SB13,14,2 196.02 (2) Definition; classification. In this subsection, "public utility" does not include a telecommunications cooperative, an unincorporated telecommunications cooperative association, or a small telecommunications utility except as provided under s. 196.205 or 196.215 (2) and does not include an alternative telecommunications utility. The commission shall provide for a comprehensive classification of service for each public utility. The classification may take into account the quantity used, the time when used, the purpose for which used, and any other reasonable consideration. Each public utility shall conform its schedules of rates, tolls and charges to such classification.

SB13, s. 14 Section 14. 196.04 (1) (a) 1. of the statutes is renumbered 196.04 (1) (a) 4. and amended to read:

SB13,14,7 196.04 (1) (a) 4. "Transmission equipment and property" means any conduit, subway, pole, tower, transmission wire, or other equipment on, over, or under any right-of-way owned or controlled by a political subdivision, street, or highway.

SB13, s. 15 Section 15. 196.04 (1) (a) 3. of the statutes is created to read:

SB13,14,10 196.04 (1) (a) 3. "Political subdivision" means any county, city, village, or town or public utility owned or operated by any county, city, village, or town.

SB13, s. 16 Section 16. 196.04 (1) (b) 1. of the statutes is amended to read:

SB13,14,18 196.04 (1) (b) 1. Any person who owns transmission equipment and property shall permit, for reasonable compensation, the use of the transmission equipment and property, including an attachment to a pole, by any public utility, video service provider, or telecommunications provider if public convenience and necessity require such use and if the use will not result in irreparable injury to any owner or user of the transmission equipment and property or in any substantial detriment to the service to be rendered by the owner or user.

SB13, s. 17 Section 17. 196.04 (2) of the statutes is amended to read:

SB13,15,14 196.04 (2) If there is a failure to agree upon the use of transmission equipment and property under sub. (1) or the conditions or compensation for the use, or if there is a failure to agree upon the physical connections or the terms and conditions upon which the physical connections shall be made, any public utility, any video service provider, telecommunications provider, or any other interested person interested may apply to the commission. If, after investigation, the commission determines that public convenience and necessity require the use of the transmission equipment and property or the physical connections and that the use or physical connections will not result in irreparable injury to the owner or other users of the transmission equipment and property or of the facilities of the public utility, video service provider, or telecommunications provider or in any substantial detriment to the service to be rendered by the owner or the public utility, video service provider, telecommunications provider, or other users of the transmission equipment and property or facilities, the commission, by order, shall direct that the use of the transmission equipment and property be permitted and that the physical connections be made. The commission shall prescribe reasonable conditions and compensation for the use of the transmission equipment and property and shall determine how and within what time the physical connections shall be made and by whom the expense of making and maintaining the physical connections shall be paid. An order under this subsection may be revised by the commission.

SB13, s. 18 Section 18. 196.09 (1) of the statutes is amended to read:

SB13,16,2 196.09 (1) In this section, "public utility" does not include a telecommunications cooperative or an unincorporated telecommunications cooperative association except as provided under s. 196.205. In subs. (2) to (7), "public utility" does not include a telecommunications utility. Subsection (9) only applies to a telecommunications utility. Every public utility shall file with the commission, within such time as may be required by the commission, its estimate of the annual rate of depreciation required for each of its classes of fixed capital used for public utility purposes, and of the composite annual rate of depreciation required for such fixed capital as an aggregate, which shall constitute the public utility's estimates of the amount which should be returned to it out of its rates for service, to meet the depreciation of its property.

SB13, s. 19 Section 19. 196.09 (9) of the statutes is repealed.

SB13, s. 20 Section 20. 196.11 (2) of the statutes is amended to read:

SB13,16,13 196.11 (2) Any arrangement under this section shall be under the supervision and regulation of the commission. The commission may order any rate, charge or regulation which the commission deems necessary to give effect to the arrangement. The commission may make any change in a rate, charge or regulation as the commission determines is necessary and reasonable and may revoke its approval and amend or rescind all orders relative to any arrangement. This subsection does not apply to telecommunications cooperatives, unincorporated telecommunications cooperative associations, or telecommunications utilities except as provided in s. 196.205.

SB13, s. 21 Section 21. 196.13 (2) of the statutes is amended to read:

SB13,16,19 196.13 (2) The commission shall publish in its reports the value of all the property actually used and useful for the convenience of the public of a public utility, other than a telecommunications utility, if the commission has held a hearing on the public utility's rates, charges, service or regulations or if the commission has otherwise determined the value of the public utility's property.

SB13, s. 22 Section 22. 196.19 (1m) of the statutes is repealed.

SB13, s. 23 Section 23. 196.19 (5) of the statutes is repealed.

SB13, s. 24 Section 24. 196.191 of the statutes is created to read:

SB13,17,15 196.191 Telecommunications utility and alternative telecommunications utility tariffs. (1) No later than the 90th day beginning after the effective date of this subsection .... [LRB inserts date], any telecommunications utility or alternative telecommunications utility that provides intrastate switched access service within this state shall at all times have on file with the commission a tariff showing all rates, tolls, and charges that it has established and that are in force for such intrastate switched access service. The absence of such a tariff before the 90th day beginning after the effective date of this subsection .... [LRB inserts date], shall not prohibit a telecommunications utility or alternative telecommunications utility from charging intrastate switched access rates for any intrastate switched access service that it provides, or limit or excuse any entity from its obligation to pay intrastate switched access rates, provided that such intrastate switched access rates comply with the requirements of ss. 196.212 and 196.219 (2r). A telecommunications utility or alternative telecommunications utility may not withdraw a tariff for switched access service once the tariff is in effect. Except as allowed under this section or to comply with ss. 196.212 and 196.219 (2r), a telecommunications utility or alternative telecommunications utility may not file to change the rates, tolls, and charges shown in a tariff for switched access service.

SB13,17,18 (2) Except as provided in this section and s. 196.212, notwithstanding anything in this chapter to the contrary, any telecommunications utility or alternative telecommunications utility may do any of the following:

SB13,18,3 (a) Retain on file with the commission tariffs already on file with the commission as of the effective date of this paragraph .... [LRB inserts date], showing the rates, tolls, and charges and the terms and conditions that the telecommunications utility or alternative telecommunications utility has established as of the effective date of this paragraph .... [LRB inserts date], for some or all of the services performed by the telecommunications utility or alternative telecommunications utility within the state or for any service in connection therewith or performed by any telecommunications utility or alternative telecommunications utility controlled or operated by the telecommunications utility or alternative telecommunications utility.

SB13,18,11 (b) File with the commission new tariffs showing the rates, tolls, and charges and the terms and conditions that the telecommunications utility or alternative telecommunications utility has established, as provided in the tariff filings, for some or all of the services performed by the telecommunications utility or alternative telecommunications utility within the state or for any service in connection therewith or performed by any telecommunications utility or alternative telecommunications utility controlled or operated by the telecommunications utility or alternative telecommunications utility.

SB13,18,13 (c) Except as provided in sub. (1), withdraw a tariff for any service by providing notice to the commission.

SB13,18,18 (d) 1. Except as provided in subd. 2., change the rates, tolls, and charges and the terms and conditions of a tariff on file with the commission by filing a revised tariff with the commission. Except as provided in subd. 2., a proposed change in a tariff shall be effective at the time specified in the revised tariff as filed with the commission.

SB13,18,25 2. No change in a tariff that constitutes an increase in intrastate switched access rates may be made unless the change is consistent with the public interest factors set forth in s. 196.03 (6) and does not violate ss. 196.212 and 196.219 (2r) and the commission by order, after investigation and opportunity for a hearing, approves the change, except that an increase in intrastate switched access rates shall be effective at the time specified in the revised tariff as filed with the commission, if either of the following is satisfied:

SB13,19,3 a. The increase results in the intrastate switched access rates mirroring the interstate switched access rates for the telecommunications utility or alternative telecommunications utility.

SB13,19,9 b. If the telecommunications utility or alternative telecommunications utility is a small telecommunications utility, the increase does not violate s. 196.212 or 196.219 (2r), does not exceed, in any 12-month period, the percentage increase in the U.S. consumer price index for all urban consumers, U.S. city average, for the previous year, and is not greater than the corresponding increase in interstate switched access rates for the small telecommunications utility.