66-2005.Telecommunications; infrastructuredevelopment; universal servicerequirements; rate rebalancing; price cap regulation; price deregulation; when;exceptions; commission report; individual customer pricing; pricereregulation.(a) Each local exchange carrier shall file anetwork infrastructure plan with the commission on or after January1, 1997, and prior to January 1, 1998. Each plan, as a part ofuniversal service protection, shall include schedules, which shallbe approved by the commission, for deployment of universal servicecapabilities by July 1, 1998, and the deployment of enhanceduniversal service capabilities by July 1, 2003, as definedpursuant to subsections (p) and (q) of K.S.A. 66-1,187, andamendments thereto,respectively. With respect to enhanced universal service, such schedulesshallprovide fordeployment of ISDN, or its technological equivalent, or broadband facilities,only upon a firm customer order for such service, or for deployment of otherenhanced universal services by a local exchange carrier. After receipt of suchan order and upon completion of a deployment plan designed to meet the firmorder orotherwise provide for the deployment of enhanced universal service, alocal exchange carrier shall notify the commission. The commission shallapprove the plan unless the commission determines that the proposed deploymentplan is unnecessary, inappropriate, or not cost effective, or would create anunreasonable or excessive demand on the KUSF. The commission shall take actionwithin 90 days. If the commission fails to take action within 90 days, thedeployment plan shall be deemed approved. This approval process shall continueuntil July 1, 2000. Eachplan shall demonstrate the capability of the localexchange carrier to comply on an ongoing basis with quality ofservice standards to be adopted by the commission no later thanJanuary 1, 1997.
(b) In order to protect universal service, facilitate thetransition to competitive markets and stimulate the construction ofan advanced telecommunications infrastructure, each local exchangecarrier shall file a regulatory reform plan at the same time as itfiles the network infrastructure plan required in subsection (a).As part of its regulatory reform plan, a local exchange carrier mayelect traditional rate of return regulation or price capregulation. Carriers that elect price cap regulation shall beexempt from rate base, rate of return and earnings regulation and shall notbe subject to the provisions of K.S.A. 66-136 and 66-127, and amendmentstheretoexcept as otherwiseprovided in such sections.However, the commission may resume such regulation upon finding,after a hearing, that a carrier that is subject to price capregulation has: violated minimum quality of service standardspursuant to subsection (l) of K.S.A. 66-2002, andamendmentsthereto; been givenreasonable notice and an opportunity to correct the violation; andfailed to do so. Regulatory reform plans also shall include:
(1) A commitment to provide existing and newly orderedpoint-to-point broadband services to: Any hospital as defined inK.S.A. 65-425, and amendments thereto; any school accreditedpursuant to K.S.A. 72-1101 et seq., and amendments thereto; anypublic library; or other state and local government facilities atdiscounted prices close to, but not below, long-run incrementalcost; and
(2) a commitment to provide basic rate ISDN service, or thetechnological equivalent, at prices which are uniform throughoutthe carrier's service area. Local exchangecarriers shall not be required to allow retail customers purchasingthe foregoing discounted services to resell those services to othercategories of customers. Telecommunications carriers may purchasebasic rate ISDN services, or the technological equivalent, for resale inaccordance with K.S.A. 66-2003, and amendments thereto. The commission mayreduce pricescharged forservices outlined in provisions (1) and (2) of this subsection, ifthe commitments of the local exchange carrier set forth in thoseprovisions are not being kept.
(c) Subject to the commission's approval, all local exchangecarriers shall reduce intrastate access charges to interstatelevels as provided herein. Rates for intrastate switched access,and the imputed access portion of toll, shall be reduced over athree-year period with the objective of equalizing interstate andintrastate rates in a revenue neutral, specific and predictablemanner. The commission is authorized to rebalance local residentialand business service rates to offset the intrastate access and tollcharge reductions. Any remaining portion of the reduction in accessand toll charges not recovered through local residential andbusiness service rates shall be paid out from the KUSF pursuant toK.S.A. 66-2008, and amendments thereto.Each rural telephone company shall adjustits intrastate switched access rates on March 1 of each odd-numbered year tomatch its interstate switched access rates, subject to the following:
(1) Any reduction of a rural telephone company's cost recovery due toreduction of its interstate access revenue shall be recovered from the KUSF;
(2) any portion of rural telephone company reductions in intrastate switchedaccess rates which would result in an increase in KUSF recovery in a singleyear which exceeds .75% of intrastate retail revenues used in determining sumswhich may be recovered from Kansas telecommunications customers pursuant tosubsection (a) of K.S.A. 66-2008, and amendments thereto, shallbe deferred until March 1 of the next following odd-numbered year; and
(3) no rural company shall be required at any time to reduce its intrastateswitched access rates below the level of its interstate switched accessrates.
(d) Beginning March 1, 1997, each rural telephone companyshall have the authority to increase annually its monthly basiclocal residential and business service rates by an amount not toexceed $1 in each 12-month period until such monthlyrates reach anamount equal to the statewide rural telephone company average ratesfor such services. The statewide rural telephone company averagerates shall be the arithmetic mean of the lowest flat rate as ofMarch 1, 1996, for local residential service and for local businessservice offered by each rural telephone company within the state.In the case of a rural telephone company which increases its localresidential service rate or its local business service rate, orboth, to reach the statewide rural telephone company average ratefor such services, the amount paid to the company from the KUSFshall be reduced by an amount equal to the additional revenuereceived by such company through such rate increase. In the case ofa rural telephone company which elects to maintain a localresidential service rate or a local business service rate, or both,below the statewide rural telephone company average, the amountpaid to the company from the KUSF shall be reduced by an amountequal to the difference between the revenue the company couldreceive if it elected to increase such rate to the average rate andthe revenue received by the company.
(e) For purposes of determining sufficient KUSF support, an affordablerate forlocal exchangeservice provided by a rural telephone company subject to traditional rate ofreturn regulationshall be determined as follows:
(1) For residential service, an affordable rate shall be the arithmetic meanof residentiallocal service rates charged in this state in all exchanges served by ruraltelephone companies andin all exchanges in rate groups 1 through 3 as of February 20, 2002, of allother local exchangecarriers, weighted by the number of residential access lines to which each suchrate applies, and thereafterrounded to the nearest quarter-dollar, subject to the following provisions:
(A) If a rural telephone company's present residential rate, including anyseparate chargefor tone dialing, is at or above such weighted mean, such rate shall be deemedaffordable prior toMarch 1, 2007.
(B) If a rural telephone company's present residential rate, including anyseparate chargefor tone dialing, is below such average: (i) Such rate shall be deemedaffordable prior to March 1,2003; (ii) as of March 1, 2003, and prior to March 1, 2004, a rate $2 higherthan the company'spresent residential monthly rate, but not exceeding such weighted mean, shallbe deemedaffordable; (iii) as of March 1, 2004, and prior to March 1, 2005, a rate $4higher than thecompany's present residential monthly rate, but not exceeding such weightedmean, shall be deemed affordable; and (iv) as of March 1, 2005, and prior toMarch 1, 2006, a rate $6 higherthan the company's present residential monthly rate, but not exceeding suchweighted mean,shall be deemed affordable.
(C) As of March 1, 2007, and each two years thereafter, an affordableresidential servicerate shall be the weighted arithmetic mean of local service rates determined asof October 1 of the preceding year in the mannerhereinbeforespecified, except that any increase in such mean exceeding $2 may be satisfiedby increases in arural telephone company's residential monthly service rate not exceeding $2 peryear,effective March 1of the year when such mean is determined, with the remainder applied at therate of $2 per year, but not to exceed the affordable rate.
(2) For single line business service at any time, an affordable rate shall bethe existingrate or an amount $3 greater than the affordable rate for residential serviceasdetermined under provision(1) of this subsection, whichever is higher, except that any increase in thebusiness service affordable rate exceeding $2 may be satisfied by increases ina rural telephone company's business monthly service rate not exceeding $2 peryear, effective March 1 of the year when such rate is determined, with theremainder applied at the rate of $2 per year, but not to exceed the affordablerate.
(3) Any flat fee or charge imposed per line on all residential service orsingle linebusiness service, or both, other than a fee or charge for contribution to theKUSF or imposed by other governmental authority, shall be added to the basicservice rate for purposesof determining anaffordable rate pursuant to this subsection.
(4) Not later than March 1, 2003, tone dialing shall be made available to alllocal service customers of each rural telephone company at no charge additionalto any increase in the local service rate to become effective on that date. Theamount of revenue received as of March 1, 2002, by a rural telephone companyfrom the provision of tone dialing service shall be excluded from reductions inthe company's KUSF support otherwise resulting pursuant to this subsection.
(5) A rural telephone company which raises one or more local service rates onapplicationmade after February 20, 2002, and pursuant to subsection (b) of K.S.A. 66-2007,andamendments thereto, shall have the level of its affordable rate increased by anamount equal tothe amount of the increase in such rate.
(6) Upon motion by a rural telephone company, the commission may determine ahigheraffordable local residential or business rate for such company if such higherrate allows thecompany to provide additional or improved service to customers, but anyincrease in a ruraltelephone company's local rate attributable to the provision of increasedcalling scope shall notbe included in any subsequent recalculation of affordable rates as otherwiseprovided in thissubsection.
(7) A uniform rate for residential and single line business local serviceadopted by a rural telephone company shall be deemed an affordable rate forpurposes of this subsection if application of such uniform rate generatesrevenue equal to that which would be generated by application of residentialand business rates which are otherwise deemed affordable rates for such companyunder this subsection.
(8) The provisions of this subsection relating to the implementation of anaffordable rate shall not apply to rural telephone companies which do notreceive KUSF support. When recalculating affordable rates as provided in thissubsection, the rates used shall include the actual rates charged by ruralcompanies that do not receive KUSF support.
(f) For regulatory reform plans in which price cap regulationhas been elected, price cap plans shall have three baskets:Residential and single-line business, including touch-tone;switched access services; and miscellaneous services. Thecommission shall establish price caps at the prices existing whenthe regulatory plan is filed subject to rate rebalancing asprovided in subsection (c) for residential services, includingtouch-tone services, and for single-line business services,including touch-tone services, within the residential andsingle-line business service basket. The commission shall establisha formula for adjustments to the price caps. The commission alsoshall establish price caps at the prices existing when theregulatory plan is filed for the miscellaneous services basket. Thecommission shall approve any adjustments to the price caps for themiscellaneous service basket, as provided in subsection (g).
(g) On or before January 1, 1997, the commission shallissuea final order in a proceeding to determine the price cap adjustmentformula that shall apply to the price caps for the localresidential and single-line business and the miscellaneous servicesbaskets and for sub-categories, if any, within those baskets. Indetermining this formula, the commission shall balance the publicpolicy goals of encouraging efficiency and promoting investment ina quality, advanced telecommunications network in the state. Thecommission also shall establish any informational filingrequirements necessary for the review of any price cap tarifffilings, including price increases or decreases within the caps, toverify such caps would not be exceeded by any proposed pricechange. The adjustment formula shall apply to the price caps forthe local residential and single-line business basket afterDecember 31, 1999, and to the miscellaneous services basket afterDecember 31, 1997. The price cap formula, but not actual prices,shall be reviewed every five years.
(h) The price caps for the residential and single-linebusiness service basket shall be capped at their initial leveluntil January 1, 2000, except for any increases authorized as apart of the revenue neutral rate rebalancing under subsection (c).The price caps for this basket and for the categories in thisbasket, if any, shall be adjusted annually after December 31, 1999,based on the formula determined by the commission under subsection (g).
(i) The price cap for the switched access service basket shallbe set based upon the local exchange carrier's intrastate accesstariffs as of January 1, 1997, except for any revenue neutral raterebalancing authorized in accordance with subsection (c).Thereafter, the cap for this basket shall not change except inconnection with any subsequent revenue neutral rebalancingauthorized by the commission under subsection (c).
(j) The price caps for the miscellaneous services basket shallbe adjusted annually after December 31, 1997, based on theadjustment formula determined by the commission under subsection (g).
(k) A price cap is a maximum price for all services taken asa whole in a given basket. Prices for individual services may bechanged within the service categories, if any, established by thecommission within a basket. An entire service category, if any,within the residential and single-line business basket ormiscellaneous services basket may be priced below the cap for suchcategory. Unless otherwise approved by the commission, no serviceshall be priced below the price floor which will be long-runincremental cost and imputed access charges. Access charges equalto those paid by telecommunications carriers to local exchangecarriers shall be imputed as part of the price floor for tollservices offered by local exchange carriers on a toll service basis.
(l) A local exchange carrier may offer promotions within anexchange or group of exchanges. All promotions shall be approved bythe commission and may notbe unjust, unreasonably discriminatory or unduly preferential.
(m) Unless the commission authorizes price deregulation at anearlier date, intrastate toll services within the miscellaneousservices basket shall continue to be regulated until the affectedlocal exchange carrier begins to offer 1+ intraLATA dialing paritythroughout its service territory, at which time intrastate tollwill be price deregulated, except that prices cannot be set belowthe price floor.
(n) On or before July 1, 1997, the commission shall establishguidelines for reducing regulation prior to price deregulation ofprice cap regulated services in the miscellaneous services basket,the switched access services basket, and the residential andsingle-line business basket.
(o) Subsequent to the adoption of guidelines pursuant to subsection (n), thecommission shall initiate a petitioning procedure under which the localexchange carrier may request rate range pricing. The commission shall act upona petition within 21 days, subject to a 30-dayextension.The prices within a rate range shall be tariffed and shall apply to allcustomers in a nondiscriminatory manner in an exchange or group of exchanges.
(p) A local exchange carrier may petition the commission todesignate an individual service or service category, if any, within themiscellaneous services basket, the switched access services basket or theresidential and single-line business basket for reduced regulation. Thecommission shall act upon a petition for reduced regulation within 21 days,subject to an extension period of an additional 30days, andupon a good cause showing of the commission in theextensionorder, or within such shorter time as the commission shall approve. Thecommission shall issue a final order within the 21-day period or within a51-day period if an extension has been issued.Following anorder granting reduced regulation of an individual service or service category,the commission shall act on any request for price reductions within seven dayssubject to a 30-day extension. The commission shallact onother requests for price cap adjustments, adjustments within price cap plansand on new service offerings within 21 days subject to a 30-dayextension. Such a change will be presumed lawful unless it isdetermined the prices are below the price floor or that the price cap for acategory, if any, within the entire basket has been exceeded.
(q) (1) Beginning July 1, 2006, price regulation of telecommunicationsservices in theresidential and single-line business service basket and the miscellaneousservices basket for localexchange carriers subject to price cap regulation shall be as follows:
(A) Packages or bundles of services shall be price deregulated statewide,however theindividual telecommunication service components of such packages or bundlesshall remainavailable for purchase on an individual basis at prices subject to price capregulation in anyexchange in which the standards in subsection (q)(1)(B), (C) or (D) have notbeen met. If standards in subsection (q)(1)(B), (C) or (D) have been met,the individual telecommunication service components of such packages orbundles shall remain available for purchase on an individual basis andprices for packages or bundles shall not exceed the sum of the highest pricesof the ala carte components of the package or bundle;
(B) in any exchange in which there are 75,000 or more local exchange accesslinesserved by all providers, rates for all telecommunications services shall beprice deregulated;
(C) in any exchange in which there are fewer than 75,000 local exchangeaccess linesserved by all providers, the commission shall price deregulate all businesstelecommunication services upon ademonstration by the requesting local telecommunications carrier that there aretwo or morenonaffiliated telecommunications carriers or other entities, that arenonaffiliated with the local exchange carrier, providing localtelecommunicationsservice to business customers, regardless of whether the entity provides localservice inconjunction with other services in that exchange area. One of suchnonaffiliated carriers or entities shall be required to be a facilities-basedcarrier or entity and not more than one of such nonaffiliated carriers orentities shall be a provider of commercial mobile radio services in thatexchange;
(D) in any exchange in which there are fewer than 75,000 local exchangeaccess linesserved by all providers, the commission shall price deregulate all residentialtelecommunication services upon ademonstration by the requesting local telecommunications carrier that there aretwo or morenonaffiliated telecommunications carriers or other entities, that arenonaffiliated with the local exchange carrier, providing localtelecommunicationsservice to residential customers, regardless of whether the entity provideslocal service in conjunction with other services in that exchange area. One ofsuch nonaffiliated carriers or entities shall be required to be afacilities-based carrier or entity and not more than one of such nonaffiliatedcarriers or entities shall be a provider of commercial mobile radio servicesin that exchange;
(E) rates for lifeline services shall remain subject to price cap regulation;
(F) up to and continuing until July 1, 2008, rates for the initialresidential local exchange access line and up tofour business local exchange access lines at one location shall remain subjectto price cap regulation.On and after July 1, 2008, the localexchange carrier shall be authorized to adjust such rates without commissionapproval by not more than the percentage increase in the consumer price indexfor all urban consumers, as officially reported by the bureau of laborstatistics of the United States department of labor, or its successor index, inany one year period and such rates shall not be adjusted below the price floorestablished in subsection (k).Such rates shall not be affected by purchase of one ormore of the following: Call management services, intraLATA long distanceservice or interLATA long distance service; and
(G) local exchange carriers shall offer a uniform price throughout each suchexchange for services subject to price deregulation, under this subsection,including packages or bundles of services, except as provided in subsection (1)or as otherwise approved by the commission.
(2) For the purposes of this subsection:
(A) Any entity providing voice service shall be considered as a localtelecommunications service provider regardless of whether such entity issubject to regulation by the commission;
(B) a provider of local telecommunications service that requires the use of athird party, unaffiliated broadband network or dial-up internet network for theorigination of local voice service shall not be considered a localtelecommunications service provider;
(C) telecommunications carriers offering only prepaid telecommunicationsservice shall not be considered entities providing local telecommunicationsservice.
(3) If the services of a local exchange carrier are classified as pricederegulated under this subsection, the carrier may thereafter adjust its ratesfor such price deregulated services upward or downward as it determinesappropriate in its competitive environment, with tariffs for such servicesdeemed effective upon filing with the commission.Price deregulated services shall be subject to the price floor in subsection(k), and shall not be unreasonably discriminatory or unduly preferential withinan exchange.
(4) The commission shall act upon a petition filed pursuant to subsection(q)(1)(C) or (D) within 21 days, subject to an extension period of anadditional 30 days, and upon a good cause showing of the commission in theextension order, or within such shorter time as the commission shall approve.The commission shall issue a final order within the 21-day period or within a51-day period if an extension order has been issued.
(5) The commission may resume price cap regulation of a local exchangecarrier, deregulated under this subsection upon finding, after a hearing, thatsuch carrier has: Violated minimum quality of service standards pursuant tosubsection (1) of K.S.A. 66-2002, and amendments thereto; been given reasonablenotice and an opportunity to correct the violation; and failed to do so.
(6) The commission on July 1, 2006, and on each date that any service isderegulated, shall record the rates of each service which has been pricederegulated in each exchange.
(7) Prior to January 1, 2007, the commission shall determine the weighted,statewide average rate of nonwireless basic local telecommunications service asof July 1, 2006. Prior to January 1, 2007, and annually thereafter,the commission shall determine the weighted, average rate of nonwireless basiclocal telecommunications services in exchanges that have been price deregulatedpursuant to subsection (q)(1)(B), (C) or (D). The commission shall report itsfindings on or before February 1, 2007, and annually thereafter to thegovernor, the legislature and each member of the standing committees of thehouse of representatives and the senate which are assigned telecommunicationsissues. The commission shall also provide insuch annual report any additional information it deems useful in determiningthe impact of price deregulation on consumers and the competitive environment,including, but not limited to, the rates recorded under paragraph (6) of thissubsection, the current rates for services in price deregulated exchanges,changes in service offerings available in price deregulated exchanges and thechange in the number of competitors in price deregulated exchanges. If thecommission finds that the weighted,average rate of nonwireless basic local telecommunications service, inexchanges that havebeen price deregulated pursuant to subsection (q)(1)(B), (C) or (D) in anyone year period is greater than the weighted, statewide average rate ofnonwireless basic local telecommunications service as of July 1,2008,multiplied by one plus the percentage increase in the consumer price index forgoods and services for the study periods, or the commission believes thatchanges in state law are warranted due to the status of competition, thecommission shall recommend to thegovernor, the legislature and each member of the standing committees of thehouse of representatives and the senate which are assigned telecommunicationsissues such changes in state law as the commission deemsappropriate and the commission shall also send a report of such findings toeach member of the legislature.
(8) For the purposes of this subsection:
(A) "Packages or bundles of services" means the offering of a localtelecommunicationsservice with one or more of the following, subscribed together, as one serviceoption offered atone price, one or more call management services, intraLATA long distanceservice, interLATA long distance service, internet access, video services orwireless services. Packages or bundles ofservices shall not include only a single residential local exchange access lineor up to four business local exchange access lines at one location andintraLATAlong distance service or interLATA long distance service, or both;
(B) "local telecommunications service" means two-way voice service capable ofbeing originated and terminated within the exchange of the local exchangetelecommunicationscompany seeking price deregulation of its services, regardless of thetechnology used to provisionthe voice service;
(C) "broadband network" means a connection that delivers services at speedsexceedingtwo hundred kilobits per second in both directions;
(D) "prepaid telecommunications service" means a local service for whichpayment ismade in advance that excludes access to operator assistance and long distanceservice;
(E) "facilities based carrier" means a telecommunications carrier or entityproviding local telecommunications service either wholly or partially over itsownnetwork. Facilities based carrier shall not include any radio communicationservices provider licensed by the federal communications commission to providecommercial mobile radio services; and
(F) "call management services" means optional telecommunications servicesthat allow a customer to manage call flow generated over the customer's localexchange access line.
(r) (1) Upon complaint or request, the commission may investigate apricederegulated service.
(2) The commission shall resume price cap regulation of a service provided inany exchange area by placing it in the appropriate service basket, as approvedby the commission, upon a determination by the commission that the conditionsin subsection (q)(1)(C) or (D) are no longer satisfied in that exchange area.
(3) The commission shall resume price cap regulation of business services inany exchange meeting the conditions of subsection (q)(1)(B) by placing it inthe appropriate service basket, as approved by the commission, upon adetermination by the commission that the following condition is not met: Thereare at least two nonaffiliated telecommunications carriers or other entities,that are nonaffiliated with the local exchange carrier, providing localtelecommunications service to business customers, regardless of whether theentity provides local service in conjunction with other services in thatexchange area. One of such nonaffiliated carriers or entities shall be requiredto be a facilities-based carrier or entity and not more than one suchnonaffiliated carriers or entities shall be a provider of commercial mobileradio services in that exchange.
(4) The commission shall resume price cap regulation of residential servicesin any exchange meeting the conditions of subsection (q)(1)(B) by placing it inthe appropriate service basket, as approved by the commission, upon adetermination by the commission that the following condition is not met: Thereare at least two or more nonaffiliated telecommunications carriers or otherentities, that are nonaffiliated with the local exchange carrier, providinglocal telecommunications service to residential customers, regardless ofwhether the entity provides local service in conjunction with other services inthat exchange area. One of such nonaffiliated carriers or entities shall berequired to be a facilities-based carrier or entity and not more than one suchnonaffiliated carriers or entities shall be a provider of commercial mobileradio services in that exchange.
(s) The commission shall require that for all local exchangecarriers all such price deregulated basic intraLATA toll servicesbe geographically averaged statewide and not be priced below theprice floor established in subsection (k).
(t) Cost studies to determine price floors shall be performedas required by the commission in response to complaints. Inaddition, notwithstanding the exemption in subsection (b), thecommission may request information necessary to execute any of itsobligations under the act. In response to a complaint that a pricederegulated service is priced below the price floor set forth in subsection(k), the commission shall issue an order within 60 days after the filing of thecomplaint unless the complainant agrees to an extension.
(u) A local exchange carrier may petition for individualcustomer pricing. The commission shall respond expeditiously to thepetition within a period of not more than 30 days subject to a 30-dayextension.
(v) No audit, earnings review or rate case shall be performedwith reference to the initial prices filed as required herein.
(w) Telecommunications carriers shall not be subject to priceregulation, except that: Access charge reductions shall be passedthrough to consumers by reductions in basic intrastate toll prices;and basic toll prices shall remain geographically averagedstatewide. As required under K.S.A. 66-131, and amendments thereto,and except as provided for in subsection (c) of K.S.A. 66-2004, and amendmentsthereto, telecommunications carriers that were not authorized toprovide switched local exchange telecommunications services in thisstate as of July 1, 1996, including cable television operators whohave not previously offered telecommunications services, mustreceive a certificate of convenience based upon a demonstration oftechnical, managerial and financial viability and the ability tomeet quality of service standards established by the commission.Any telecommunications carrier or other entity seeking suchcertificate shall file a statement, which shall be subject to thecommission's approval, specifying with particularity the areas inwhich it will offer service, the manner in which it will providethe service in such areas and whether it will serve both businesscustomers and residential customers in such areas. Any structurallyseparate affiliate of a local exchange carrier that providestelecommunications services shall be subject to the same regulatoryobligations and oversight as a telecommunications carrier, as longas the local exchange carrier's affiliate obtains access to anyservices or facilities from its affiliated local exchange carrieron the same terms and conditions as the local exchange carriermakes those services and facilities available to othertelecommunications carriers. The commission shall overseetelecommunications carriers to prevent fraud and other practicesharmful to consumers and to ensure compliance with quality ofservice standards adopted for all local exchange carriers andtelecommunications carriers in the state.
66-2005.Telecommunications; infrastructuredevelopment; universal servicerequirements; rate rebalancing; price cap regulation; price deregulation; when;exceptions; commission report; individual customer pricing; pricereregulation.(a) Each local exchange carrier shall file anetwork infrastructure plan with the commission on or after January1, 1997, and prior to January 1, 1998. Each plan, as a part ofuniversal service protection, shall include schedules, which shallbe approved by the commission, for deployment of universal servicecapabilities by July 1, 1998, and the deployment of enhanceduniversal service capabilities by July 1, 2003, as definedpursuant to subsections (p) and (q) of K.S.A. 66-1,187, andamendments thereto,respectively. With respect to enhanced universal service, such schedulesshallprovide fordeployment of ISDN, or its technological equivalent, or broadband facilities,only upon a firm customer order for such service, or for deployment of otherenhanced universal services by a local exchange carrier. After receipt of suchan order and upon completion of a deployment plan designed to meet the firmorder orotherwise provide for the deployment of enhanced universal service, alocal exchange carrier shall notify the commission. The commission shallapprove the plan unless the commission determines that the proposed deploymentplan is unnecessary, inappropriate, or not cost effective, or would create anunreasonable or excessive demand on the KUSF. The commission shall take actionwithin 90 days. If the commission fails to take action within 90 days, thedeployment plan shall be deemed approved. This approval process shall continueuntil July 1, 2000. Eachplan shall demonstrate the capability of the localexchange carrier to comply on an ongoing basis with quality ofservice standards to be adopted by the commission no later thanJanuary 1, 1997.
(b) In order to protect universal service, facilitate thetransition to competitive markets and stimulate the construction ofan advanced telecommunications infrastructure, each local exchangecarrier shall file a regulatory reform plan at the same time as itfiles the network infrastructure plan required in subsection (a).As part of its regulatory reform plan, a local exchange carrier mayelect traditional rate of return regulation or price capregulation. Carriers that elect price cap regulation shall beexempt from rate base, rate of return and earnings regulation and shall notbe subject to the provisions of K.S.A. 66-136 and 66-127, and amendmentstheretoexcept as otherwiseprovided in such sections.However, the commission may resume such regulation upon finding,after a hearing, that a carrier that is subject to price capregulation has: violated minimum quality of service standardspursuant to subsection (l) of K.S.A. 66-2002, andamendmentsthereto; been givenreasonable notice and an opportunity to correct the violation; andfailed to do so. Regulatory reform plans also shall include:
(1) A commitment to provide existing and newly orderedpoint-to-point broadband services to: Any hospital as defined inK.S.A. 65-425, and amendments thereto; any school accreditedpursuant to K.S.A. 72-1101 et seq., and amendments thereto; anypublic library; or other state and local government facilities atdiscounted prices close to, but not below, long-run incrementalcost; and
(2) a commitment to provide basic rate ISDN service, or thetechnological equivalent, at prices which are uniform throughoutthe carrier's service area. Local exchangecarriers shall not be required to allow retail customers purchasingthe foregoing discounted services to resell those services to othercategories of customers. Telecommunications carriers may purchasebasic rate ISDN services, or the technological equivalent, for resale inaccordance with K.S.A. 66-2003, and amendments thereto. The commission mayreduce pricescharged forservices outlined in provisions (1) and (2) of this subsection, ifthe commitments of the local exchange carrier set forth in thoseprovisions are not being kept.
(c) Subject to the commission's approval, all local exchangecarriers shall reduce intrastate access charges to interstatelevels as provided herein. Rates for intrastate switched access,and the imputed access portion of toll, shall be reduced over athree-year period with the objective of equalizing interstate andintrastate rates in a revenue neutral, specific and predictablemanner. The commission is authorized to rebalance local residentialand business service rates to offset the intrastate access and tollcharge reductions. Any remaining portion of the reduction in accessand toll charges not recovered through local residential andbusiness service rates shall be paid out from the KUSF pursuant toK.S.A. 66-2008, and amendments thereto.Each rural telephone company shall adjustits intrastate switched access rates on March 1 of each odd-numbered year tomatch its interstate switched access rates, subject to the following:
(1) Any reduction of a rural telephone company's cost recovery due toreduction of its interstate access revenue shall be recovered from the KUSF;
(2) any portion of rural telephone company reductions in intrastate switchedaccess rates which would result in an increase in KUSF recovery in a singleyear which exceeds .75% of intrastate retail revenues used in determining sumswhich may be recovered from Kansas telecommunications customers pursuant tosubsection (a) of K.S.A. 66-2008, and amendments thereto, shallbe deferred until March 1 of the next following odd-numbered year; and
(3) no rural company shall be required at any time to reduce its intrastateswitched access rates below the level of its interstate switched accessrates.
(d) Beginning March 1, 1997, each rural telephone companyshall have the authority to increase annually its monthly basiclocal residential and business service rates by an amount not toexceed $1 in each 12-month period until such monthlyrates reach anamount equal to the statewide rural telephone company average ratesfor such services. The statewide rural telephone company averagerates shall be the arithmetic mean of the lowest flat rate as ofMarch 1, 1996, for local residential service and for local businessservice offered by each rural telephone company within the state.In the case of a rural telephone company which increases its localresidential service rate or its local business service rate, orboth, to reach the statewide rural telephone company average ratefor such services, the amount paid to the company from the KUSFshall be reduced by an amount equal to the additional revenuereceived by such company through such rate increase. In the case ofa rural telephone company which elects to maintain a localresidential service rate or a local business service rate, or both,below the statewide rural telephone company average, the amountpaid to the company from the KUSF shall be reduced by an amountequal to the difference between the revenue the company couldreceive if it elected to increase such rate to the average rate andthe revenue received by the company.
(e) For purposes of determining sufficient KUSF support, an affordablerate forlocal exchangeservice provided by a rural telephone company subject to traditional rate ofreturn regulationshall be determined as follows:
(1) For residential service, an affordable rate shall be the arithmetic meanof residentiallocal service rates charged in this state in all exchanges served by ruraltelephone companies andin all exchanges in rate groups 1 through 3 as of February 20, 2002, of allother local exchangecarriers, weighted by the number of residential access lines to which each suchrate applies, and thereafterrounded to the nearest quarter-dollar, subject to the following provisions:
(A) If a rural telephone company's present residential rate, including anyseparate chargefor tone dialing, is at or above such weighted mean, such rate shall be deemedaffordable prior toMarch 1, 2007.
(B) If a rural telephone company's present residential rate, including anyseparate chargefor tone dialing, is below such average: (i) Such rate shall be deemedaffordable prior to March 1,2003; (ii) as of March 1, 2003, and prior to March 1, 2004, a rate $2 higherthan the company'spresent residential monthly rate, but not exceeding such weighted mean, shallbe deemedaffordable; (iii) as of March 1, 2004, and prior to March 1, 2005, a rate $4higher than thecompany's present residential monthly rate, but not exceeding such weightedmean, shall be deemed affordable; and (iv) as of March 1, 2005, and prior toMarch 1, 2006, a rate $6 higherthan the company's present residential monthly rate, but not exceeding suchweighted mean,shall be deemed affordable.
(C) As of March 1, 2007, and each two years thereafter, an affordableresidential servicerate shall be the weighted arithmetic mean of local service rates determined asof October 1 of the preceding year in the mannerhereinbeforespecified, except that any increase in such mean exceeding $2 may be satisfiedby increases in arural telephone company's residential monthly service rate not exceeding $2 peryear,effective March 1of the year when such mean is determined, with the remainder applied at therate of $2 per year, but not to exceed the affordable rate.
(2) For single line business service at any time, an affordable rate shall bethe existingrate or an amount $3 greater than the affordable rate for residential serviceasdetermined under provision(1) of this subsection, whichever is higher, except that any increase in thebusiness service affordable rate exceeding $2 may be satisfied by increases ina rural telephone company's business monthly service rate not exceeding $2 peryear, effective March 1 of the year when such rate is determined, with theremainder applied at the rate of $2 per year, but not to exceed the affordablerate.
(3) Any flat fee or charge imposed per line on all residential service orsingle linebusiness service, or both, other than a fee or charge for contribution to theKUSF or imposed by other governmental authority, shall be added to the basicservice rate for purposesof determining anaffordable rate pursuant to this subsection.
(4) Not later than March 1, 2003, tone dialing shall be made available to alllocal service customers of each rural telephone company at no charge additionalto any increase in the local service rate to become effective on that date. Theamount of revenue received as of March 1, 2002, by a rural telephone companyfrom the provision of tone dialing service shall be excluded from reductions inthe company's KUSF support otherwise resulting pursuant to this subsection.
(5) A rural telephone company which raises one or more local service rates onapplicationmade after February 20, 2002, and pursuant to subsection (b) of K.S.A. 66-2007,andamendments thereto, shall have the level of its affordable rate increased by anamount equal tothe amount of the increase in such rate.
(6) Upon motion by a rural telephone company, the commission may determine ahigheraffordable local residential or business rate for such company if such higherrate allows thecompany to provide additional or improved service to customers, but anyincrease in a ruraltelephone company's local rate attributable to the provision of increasedcalling scope shall notbe included in any subsequent recalculation of affordable rates as otherwiseprovided in thissubsection.
(7) A uniform rate for residential and single line business local serviceadopted by a rural telephone company shall be deemed an affordable rate forpurposes of this subsection if application of such uniform rate generatesrevenue equal to that which would be generated by application of residentialand business rates which are otherwise deemed affordable rates for such companyunder this subsection.
(8) The provisions of this subsection relating to the implementation of anaffordable rate shall not apply to rural telephone companies which do notreceive KUSF support. When recalculating affordable rates as provided in thissubsection, the rates used shall include the actual rates charged by ruralcompanies that do not receive KUSF support.
(f) For regulatory reform plans in which price cap regulationhas been elected, price cap plans shall have three baskets:Residential and single-line business, including touch-tone;switched access services; and miscellaneous services. Thecommission shall establish price caps at the prices existing whenthe regulatory plan is filed subject to rate rebalancing asprovided in subsection (c) for residential services, includingtouch-tone services, and for single-line business services,including touch-tone services, within the residential andsingle-line business service basket. The commission shall establisha formula for adjustments to the price caps. The commission alsoshall establish price caps at the prices existing when theregulatory plan is filed for the miscellaneous services basket. Thecommission shall approve any adjustments to the price caps for themiscellaneous service basket, as provided in subsection (g).
(g) On or before January 1, 1997, the commission shallissuea final order in a proceeding to determine the price cap adjustmentformula that shall apply to the price caps for the localresidential and single-line business and the miscellaneous servicesbaskets and for sub-categories, if any, within those baskets. Indetermining this formula, the commission shall balance the publicpolicy goals of encouraging efficiency and promoting investment ina quality, advanced telecommunications network in the state. Thecommission also shall establish any informational filingrequirements necessary for the review of any price cap tarifffilings, including price increases or decreases within the caps, toverify such caps would not be exceeded by any proposed pricechange. The adjustment formula shall apply to the price caps forthe local residential and single-line business basket afterDecember 31, 1999, and to the miscellaneous services basket afterDecember 31, 1997. The price cap formula, but not actual prices,shall be reviewed every five years.
(h) The price caps for the residential and single-linebusiness service basket shall be capped at their initial leveluntil January 1, 2000, except for any increases authorized as apart of the revenue neutral rate rebalancing under subsection (c).The price caps for this basket and for the categories in thisbasket, if any, shall be adjusted annually after December 31, 1999,based on the formula determined by the commission under subsection (g).
(i) The price cap for the switched access service basket shallbe set based upon the local exchange carrier's intrastate accesstariffs as of January 1, 1997, except for any revenue neutral raterebalancing authorized in accordance with subsection (c).Thereafter, the cap for this basket shall not change except inconnection with any subsequent revenue neutral rebalancingauthorized by the commission under subsection (c).
(j) The price caps for the miscellaneous services basket shallbe adjusted annually after December 31, 1997, based on theadjustment formula determined by the commission under subsection (g).
(k) A price cap is a maximum price for all services taken asa whole in a given basket. Prices for individual services may bechanged within the service categories, if any, established by thecommission within a basket. An entire service category, if any,within the residential and single-line business basket ormiscellaneous services basket may be priced below the cap for suchcategory. Unless otherwise approved by the commission, no serviceshall be priced below the price floor which will be long-runincremental cost and imputed access charges. Access charges equalto those paid by telecommunications carriers to local exchangecarriers shall be imputed as part of the price floor for tollservices offered by local exchange carriers on a toll service basis.
(l) A local exchange carrier may offer promotions within anexchange or group of exchanges. All promotions shall be approved bythe commission and may notbe unjust, unreasonably discriminatory or unduly preferential.
(m) Unless the commission authorizes price deregulation at anearlier date, intrastate toll services within the miscellaneousservices basket shall continue to be regulated until the affectedlocal exchange carrier begins to offer 1+ intraLATA dialing paritythroughout its service territory, at which time intrastate tollwill be price deregulated, except that prices cannot be set belowthe price floor.
(n) On or before July 1, 1997, the commission shall establishguidelines for reducing regulation prior to price deregulation ofprice cap regulated services in the miscellaneous services basket,the switched access services basket, and the residential andsingle-line business basket.
(o) Subsequent to the adoption of guidelines pursuant to subsection (n), thecommission shall initiate a petitioning procedure under which the localexchange carrier may request rate range pricing. The commission shall act upona petition within 21 days, subject to a 30-dayextension.The prices within a rate range shall be tariffed and shall apply to allcustomers in a nondiscriminatory manner in an exchange or group of exchanges.
(p) A local exchange carrier may petition the commission todesignate an individual service or service category, if any, within themiscellaneous services basket, the switched access services basket or theresidential and single-line business basket for reduced regulation. Thecommission shall act upon a petition for reduced regulation within 21 days,subject to an extension period of an additional 30days, andupon a good cause showing of the commission in theextensionorder, or within such shorter time as the commission shall approve. Thecommission shall issue a final order within the 21-day period or within a51-day period if an extension has been issued.Following anorder granting reduced regulation of an individual service or service category,the commission shall act on any request for price reductions within seven dayssubject to a 30-day extension. The commission shallact onother requests for price cap adjustments, adjustments within price cap plansand on new service offerings within 21 days subject to a 30-dayextension. Such a change will be presumed lawful unless it isdetermined the prices are below the price floor or that the price cap for acategory, if any, within the entire basket has been exceeded.
(q) (1) Beginning July 1, 2006, price regulation of telecommunicationsservices in theresidential and single-line business service basket and the miscellaneousservices basket for localexchange carriers subject to price cap regulation shall be as follows:
(A) Packages or bundles of services shall be price deregulated statewide,however theindividual telecommunication service components of such packages or bundlesshall remainavailable for purchase on an individual basis at prices subject to price capregulation in anyexchange in which the standards in subsection (q)(1)(B), (C) or (D) have notbeen met. If standards in subsection (q)(1)(B), (C) or (D) have been met,the individual telecommunication service components of such packages orbundles shall remain available for purchase on an individual basis andprices for packages or bundles shall not exceed the sum of the highest pricesof the ala carte components of the package or bundle;
(B) in any exchange in which there are 75,000 or more local exchange accesslinesserved by all providers, rates for all telecommunications services shall beprice deregulated;
(C) in any exchange in which there are fewer than 75,000 local exchangeaccess linesserved by all providers, the commission shall price deregulate all businesstelecommunication services upon ademonstration by the requesting local telecommunications carrier that there aretwo or morenonaffiliated telecommunications carriers or other entities, that arenonaffiliated with the local exchange carrier, providing localtelecommunicationsservice to business customers, regardless of whether the entity provides localservice inconjunction with other services in that exchange area. One of suchnonaffiliated carriers or entities shall be required to be a facilities-basedcarrier or entity and not more than one of such nonaffiliated carriers orentities shall be a provider of commercial mobile radio services in thatexchange;
(D) in any exchange in which there are fewer than 75,000 local exchangeaccess linesserved by all providers, the commission shall price deregulate all residentialtelecommunication services upon ademonstration by the requesting local telecommunications carrier that there aretwo or morenonaffiliated telecommunications carriers or other entities, that arenonaffiliated with the local exchange carrier, providing localtelecommunicationsservice to residential customers, regardless of whether the entity provideslocal service in conjunction with other services in that exchange area. One ofsuch nonaffiliated carriers or entities shall be required to be afacilities-based carrier or entity and not more than one of such nonaffiliatedcarriers or entities shall be a provider of commercial mobile radio servicesin that exchange;
(E) rates for lifeline services shall remain subject to price cap regulation;
(F) up to and continuing until July 1, 2008, rates for the initialresidential local exchange access line and up tofour business local exchange access lines at one location shall remain subjectto price cap regulation.On and after July 1, 2008, the localexchange carrier shall be authorized to adjust such rates without commissionapproval by not more than the percentage increase in the consumer price indexfor all urban consumers, as officially reported by the bureau of laborstatistics of the United States department of labor, or its successor index, inany one year period and such rates shall not be adjusted below the price floorestablished in subsection (k).Such rates shall not be affected by purchase of one ormore of the following: Call management services, intraLATA long distanceservice or interLATA long distance service; and
(G) local exchange carriers shall offer a uniform price throughout each suchexchange for services subject to price deregulation, under this subsection,including packages or bundles of services, except as provided in subsection (1)or as otherwise approved by the commission.
(2) For the purposes of this subsection:
(A) Any entity providing voice service shall be considered as a localtelecommunications service provider regardless of whether such entity issubject to regulation by the commission;
(B) a provider of local telecommunications service that requires the use of athird party, unaffiliated broadband network or dial-up internet network for theorigination of local voice service shall not be considered a localtelecommunications service provider;
(C) telecommunications carriers offering only prepaid telecommunicationsservice shall not be considered entities providing local telecommunicationsservice.
(3) If the services of a local exchange carrier are classified as pricederegulated under this subsection, the carrier may thereafter adjust its ratesfor such price deregulated services upward or downward as it determinesappropriate in its competitive environment, with tariffs for such servicesdeemed effective upon filing with the commission.Price deregulated services shall be subject to the price floor in subsection(k), and shall not be unreasonably discriminatory or unduly preferential withinan exchange.
(4) The commission shall act upon a petition filed pursuant to subsection(q)(1)(C) or (D) within 21 days, subject to an extension period of anadditional 30 days, and upon a good cause showing of the commission in theextension order, or within such shorter time as the commission shall approve.The commission shall issue a final order within the 21-day period or within a51-day period if an extension order has been issued.
(5) The commission may resume price cap regulation of a local exchangecarrier, deregulated under this subsection upon finding, after a hearing, thatsuch carrier has: Violated minimum quality of service standards pursuant tosubsection (1) of K.S.A. 66-2002, and amendments thereto; been given reasonablenotice and an opportunity to correct the violation; and failed to do so.
(6) The commission on July 1, 2006, and on each date that any service isderegulated, shall record the rates of each service which has been pricederegulated in each exchange.
(7) Prior to January 1, 2007, the commission shall determine the weighted,statewide average rate of nonwireless basic local telecommunications service asof July 1, 2006. Prior to January 1, 2007, and annually thereafter,the commission shall determine the weighted, average rate of nonwireless basiclocal telecommunications services in exchanges that have been price deregulatedpursuant to subsection (q)(1)(B), (C) or (D). The commission shall report itsfindings on or before February 1, 2007, and annually thereafter to thegovernor, the legislature and each member of the standing committees of thehouse of representatives and the senate which are assigned telecommunicationsissues. The commission shall also provide insuch annual report any additional information it deems useful in determiningthe impact of price deregulation on consumers and the competitive environment,including, but not limited to, the rates recorded under paragraph (6) of thissubsection, the current rates for services in price deregulated exchanges,changes in service offerings available in price deregulated exchanges and thechange in the number of competitors in price deregulated exchanges. If thecommission finds that the weighted,average rate of nonwireless basic local telecommunications service, inexchanges that havebeen price deregulated pursuant to subsection (q)(1)(B), (C) or (D) in anyone year period is greater than the weighted, statewide average rate ofnonwireless basic local telecommunications service as of July 1,2008,multiplied by one plus the percentage increase in the consumer price index forgoods and services for the study periods, or the commission believes thatchanges in state law are warranted due to the status of competition, thecommission shall recommend to thegovernor, the legislature and each member of the standing committees of thehouse of representatives and the senate which are assigned telecommunicationsissues such changes in state law as the commission deemsappropriate and the commission shall also send a report of such findings toeach member of the legislature.
(8) For the purposes of this subsection:
(A) "Packages or bundles of services" means the offering of a localtelecommunicationsservice with one or more of the following, subscribed together, as one serviceoption offered atone price, one or more call management services, intraLATA long distanceservice, interLATA long distance service, internet access, video services orwireless services. Packages or bundles ofservices shall not include only a single residential local exchange access lineor up to four business local exchange access lines at one location andintraLATAlong distance service or interLATA long distance service, or both;
(B) "local telecommunications service" means two-way voice service capable ofbeing originated and terminated within the exchange of the local exchangetelecommunicationscompany seeking price deregulation of its services, regardless of thetechnology used to provisionthe voice service;
(C) "broadband network" means a connection that delivers services at speedsexceedingtwo hundred kilobits per second in both directions;
(D) "prepaid telecommunications service" means a local service for whichpayment ismade in advance that excludes access to operator assistance and long distanceservice;
(E) "facilities based carrier" means a telecommunications carrier or entityproviding local telecommunications service either wholly or partially over itsownnetwork. Facilities based carrier shall not include any radio communicationservices provider licensed by the federal communications commission to providecommercial mobile radio services; and
(F) "call management services" means optional telecommunications servicesthat allow a customer to manage call flow generated over the customer's localexchange access line.
(r) (1) Upon complaint or request, the commission may investigate apricederegulated service.
(2) The commission shall resume price cap regulation of a service provided inany exchange area by placing it in the appropriate service basket, as approvedby the commission, upon a determination by the commission that the conditionsin subsection (q)(1)(C) or (D) are no longer satisfied in that exchange area.
(3) The commission shall resume price cap regulation of business services inany exchange meeting the conditions of subsection (q)(1)(B) by placing it inthe appropriate service basket, as approved by the commission, upon adetermination by the commission that the following condition is not met: Thereare at least two nonaffiliated telecommunications carriers or other entities,that are nonaffiliated with the local exchange carrier, providing localtelecommunications service to business customers, regardless of whether theentity provides local service in conjunction with other services in thatexchange area. One of such nonaffiliated carriers or entities shall be requiredto be a facilities-based carrier or entity and not more than one suchnonaffiliated carriers or entities shall be a provider of commercial mobileradio services in that exchange.
(4) The commission shall resume price cap regulation of residential servicesin any exchange meeting the conditions of subsection (q)(1)(B) by placing it inthe appropriate service basket, as approved by the commission, upon adetermination by the commission that the following condition is not met: Thereare at least two or more nonaffiliated telecommunications carriers or otherentities, that are nonaffiliated with the local exchange carrier, providinglocal telecommunications service to residential customers, regardless ofwhether the entity provides local service in conjunction with other services inthat exchange area. One of such nonaffiliated carriers or entities shall berequired to be a facilities-based carrier or entity and not more than one suchnonaffiliated carriers or entities shall be a provider of commercial mobileradio services in that exchange.
(s) The commission shall require that for all local exchangecarriers all such price deregulated basic intraLATA toll servicesbe geographically averaged statewide and not be priced below theprice floor established in subsection (k).
(t) Cost studies to determine price floors shall be performedas required by the commission in response to complaints. Inaddition, notwithstanding the exemption in subsection (b), thecommission may request information necessary to execute any of itsobligations under the act. In response to a complaint that a pricederegulated service is priced below the price floor set forth in subsection(k), the commission shall issue an order within 60 days after the filing of thecomplaint unless the complainant agrees to an extension.
(u) A local exchange carrier may petition for individualcustomer pricing. The commission shall respond expeditiously to thepetition within a period of not more than 30 days subject to a 30-dayextension.
(v) No audit, earnings review or rate case shall be performedwith reference to the initial prices filed as required herein.
(w) Telecommunications carriers shall not be subject to priceregulation, except that: Access charge reductions shall be passedthrough to consumers by reductions in basic intrastate toll prices;and basic toll prices shall remain geographically averagedstatewide. As required under K.S.A. 66-131, and amendments thereto,and except as provided for in subsection (c) of K.S.A. 66-2004, and amendmentsthereto, telecommunications carriers that were not authorized toprovide switched local exchange telecommunications services in thisstate as of July 1, 1996, including cable television operators whohave not previously offered telecommunications services, mustreceive a certificate of convenience based upon a demonstration oftechnical, managerial and financial viability and the ability tomeet quality of service standards established by the commission.Any telecommunications carrier or other entity seeking suchcertificate shall file a statement, which shall be subject to thecommission's approval, specifying with particularity the areas inwhich it will offer service, the manner in which it will providethe service in such areas and whether it will serve both businesscustomers and residential customers in such areas. Any structurallyseparate affiliate of a local exchange carrier that providestelecommunications services shall be subject to the same regulatoryobligations and oversight as a telecommunications carrier, as longas the local exchange carrier's affiliate obtains access to anyservices or facilities from its affiliated local exchange carrieron the same terms and conditions as the local exchange carriermakes those services and facilities available to othertelecommunications carriers. The commission shall overseetelecommunications carriers to prevent fraud and other practicesharmful to consumers and to ensure compliance with quality ofservice standards adopted for all local exchange carriers andtelecommunications carriers in the state.
66-2005.Telecommunications; infrastructuredevelopment; universal servicerequirements; rate rebalancing; price cap regulation; price deregulation; when;exceptions; commission report; individual customer pricing; pricereregulation.(a) Each local exchange carrier shall file anetwork infrastructure plan with the commission on or after January1, 1997, and prior to January 1, 1998. Each plan, as a part ofuniversal service protection, shall include schedules, which shallbe approved by the commission, for deployment of universal servicecapabilities by July 1, 1998, and the deployment of enhanceduniversal service capabilities by July 1, 2003, as definedpursuant to subsections (p) and (q) of K.S.A. 66-1,187, andamendments thereto,respectively. With respect to enhanced universal service, such schedulesshallprovide fordeployment of ISDN, or its technological equivalent, or broadband facilities,only upon a firm customer order for such service, or for deployment of otherenhanced universal services by a local exchange carrier. After receipt of suchan order and upon completion of a deployment plan designed to meet the firmorder orotherwise provide for the deployment of enhanced universal service, alocal exchange carrier shall notify the commission. The commission shallapprove the plan unless the commission determines that the proposed deploymentplan is unnecessary, inappropriate, or not cost effective, or would create anunreasonable or excessive demand on the KUSF. The commission shall take actionwithin 90 days. If the commission fails to take action within 90 days, thedeployment plan shall be deemed approved. This approval process shall continueuntil July 1, 2000. Eachplan shall demonstrate the capability of the localexchange carrier to comply on an ongoing basis with quality ofservice standards to be adopted by the commission no later thanJanuary 1, 1997.
(b) In order to protect universal service, facilitate thetransition to competitive markets and stimulate the construction ofan advanced telecommunications infrastructure, each local exchangecarrier shall file a regulatory reform plan at the same time as itfiles the network infrastructure plan required in subsection (a).As part of its regulatory reform plan, a local exchange carrier mayelect traditional rate of return regulation or price capregulation. Carriers that elect price cap regulation shall beexempt from rate base, rate of return and earnings regulation and shall notbe subject to the provisions of K.S.A. 66-136 and 66-127, and amendmentstheretoexcept as otherwiseprovided in such sections.However, the commission may resume such regulation upon finding,after a hearing, that a carrier that is subject to price capregulation has: violated minimum quality of service standardspursuant to subsection (l) of K.S.A. 66-2002, andamendmentsthereto; been givenreasonable notice and an opportunity to correct the violation; andfailed to do so. Regulatory reform plans also shall include:
(1) A commitment to provide existing and newly orderedpoint-to-point broadband services to: Any hospital as defined inK.S.A. 65-425, and amendments thereto; any school accreditedpursuant to K.S.A. 72-1101 et seq., and amendments thereto; anypublic library; or other state and local government facilities atdiscounted prices close to, but not below, long-run incrementalcost; and
(2) a commitment to provide basic rate ISDN service, or thetechnological equivalent, at prices which are uniform throughoutthe carrier's service area. Local exchangecarriers shall not be required to allow retail customers purchasingthe foregoing discounted services to resell those services to othercategories of customers. Telecommunications carriers may purchasebasic rate ISDN services, or the technological equivalent, for resale inaccordance with K.S.A. 66-2003, and amendments thereto. The commission mayreduce pricescharged forservices outlined in provisions (1) and (2) of this subsection, ifthe commitments of the local exchange carrier set forth in thoseprovisions are not being kept.
(c) Subject to the commission's approval, all local exchangecarriers shall reduce intrastate access charges to interstatelevels as provided herein. Rates for intrastate switched access,and the imputed access portion of toll, shall be reduced over athree-year period with the objective of equalizing interstate andintrastate rates in a revenue neutral, specific and predictablemanner. The commission is authorized to rebalance local residentialand business service rates to offset the intrastate access and tollcharge reductions. Any remaining portion of the reduction in accessand toll charges not recovered through local residential andbusiness service rates shall be paid out from the KUSF pursuant toK.S.A. 66-2008, and amendments thereto.Each rural telephone company shall adjustits intrastate switched access rates on March 1 of each odd-numbered year tomatch its interstate switched access rates, subject to the following:
(1) Any reduction of a rural telephone company's cost recovery due toreduction of its interstate access revenue shall be recovered from the KUSF;
(2) any portion of rural telephone company reductions in intrastate switchedaccess rates which would result in an increase in KUSF recovery in a singleyear which exceeds .75% of intrastate retail revenues used in determining sumswhich may be recovered from Kansas telecommunications customers pursuant tosubsection (a) of K.S.A. 66-2008, and amendments thereto, shallbe deferred until March 1 of the next following odd-numbered year; and
(3) no rural company shall be required at any time to reduce its intrastateswitched access rates below the level of its interstate switched accessrates.
(d) Beginning March 1, 1997, each rural telephone companyshall have the authority to increase annually its monthly basiclocal residential and business service rates by an amount not toexceed $1 in each 12-month period until such monthlyrates reach anamount equal to the statewide rural telephone company average ratesfor such services. The statewide rural telephone company averagerates shall be the arithmetic mean of the lowest flat rate as ofMarch 1, 1996, for local residential service and for local businessservice offered by each rural telephone company within the state.In the case of a rural telephone company which increases its localresidential service rate or its local business service rate, orboth, to reach the statewide rural telephone company average ratefor such services, the amount paid to the company from the KUSFshall be reduced by an amount equal to the additional revenuereceived by such company through such rate increase. In the case ofa rural telephone company which elects to maintain a localresidential service rate or a local business service rate, or both,below the statewide rural telephone company average, the amountpaid to the company from the KUSF shall be reduced by an amountequal to the difference between the revenue the company couldreceive if it elected to increase such rate to the average rate andthe revenue received by the company.
(e) For purposes of determining sufficient KUSF support, an affordablerate forlocal exchangeservice provided by a rural telephone company subject to traditional rate ofreturn regulationshall be determined as follows:
(1) For residential service, an affordable rate shall be the arithmetic meanof residentiallocal service rates charged in this state in all exchanges served by ruraltelephone companies andin all exchanges in rate groups 1 through 3 as of February 20, 2002, of allother local exchangecarriers, weighted by the number of residential access lines to which each suchrate applies, and thereafterrounded to the nearest quarter-dollar, subject to the following provisions:
(A) If a rural telephone company's present residential rate, including anyseparate chargefor tone dialing, is at or above such weighted mean, such rate shall be deemedaffordable prior toMarch 1, 2007.
(B) If a rural telephone company's present residential rate, including anyseparate chargefor tone dialing, is below such average: (i) Such rate shall be deemedaffordable prior to March 1,2003; (ii) as of March 1, 2003, and prior to March 1, 2004, a rate $2 higherthan the company'spresent residential monthly rate, but not exceeding such weighted mean, shallbe deemedaffordable; (iii) as of March 1, 2004, and prior to March 1, 2005, a rate $4higher than thecompany's present residential monthly rate, but not exceeding such weightedmean, shall be deemed affordable; and (iv) as of March 1, 2005, and prior toMarch 1, 2006, a rate $6 higherthan the company's present residential monthly rate, but not exceeding suchweighted mean,shall be deemed affordable.
(C) As of March 1, 2007, and each two years thereafter, an affordableresidential servicerate shall be the weighted arithmetic mean of local service rates determined asof October 1 of the preceding year in the mannerhereinbeforespecified, except that any increase in such mean exceeding $2 may be satisfiedby increases in arural telephone company's residential monthly service rate not exceeding $2 peryear,effective March 1of the year when such mean is determined, with the remainder applied at therate of $2 per year, but not to exceed the affordable rate.
(2) For single line business service at any time, an affordable rate shall bethe existingrate or an amount $3 greater than the affordable rate for residential serviceasdetermined under provision(1) of this subsection, whichever is higher, except that any increase in thebusiness service affordable rate exceeding $2 may be satisfied by increases ina rural telephone company's business monthly service rate not exceeding $2 peryear, effective March 1 of the year when such rate is determined, with theremainder applied at the rate of $2 per year, but not to exceed the affordablerate.
(3) Any flat fee or charge imposed per line on all residential service orsingle linebusiness service, or both, other than a fee or charge for contribution to theKUSF or imposed by other governmental authority, shall be added to the basicservice rate for purposesof determining anaffordable rate pursuant to this subsection.
(4) Not later than March 1, 2003, tone dialing shall be made available to alllocal service customers of each rural telephone company at no charge additionalto any increase in the local service rate to become effective on that date. Theamount of revenue received as of March 1, 2002, by a rural telephone companyfrom the provision of tone dialing service shall be excluded from reductions inthe company's KUSF support otherwise resulting pursuant to this subsection.
(5) A rural telephone company which raises one or more local service rates onapplicationmade after February 20, 2002, and pursuant to subsection (b) of K.S.A. 66-2007,andamendments thereto, shall have the level of its affordable rate increased by anamount equal tothe amount of the increase in such rate.
(6) Upon motion by a rural telephone company, the commission may determine ahigheraffordable local residential or business rate for such company if such higherrate allows thecompany to provide additional or improved service to customers, but anyincrease in a ruraltelephone company's local rate attributable to the provision of increasedcalling scope shall notbe included in any subsequent recalculation of affordable rates as otherwiseprovided in thissubsection.
(7) A uniform rate for residential and single line business local serviceadopted by a rural telephone company shall be deemed an affordable rate forpurposes of this subsection if application of such uniform rate generatesrevenue equal to that which would be generated by application of residentialand business rates which are otherwise deemed affordable rates for such companyunder this subsection.
(8) The provisions of this subsection relating to the implementation of anaffordable rate shall not apply to rural telephone companies which do notreceive KUSF support. When recalculating affordable rates as provided in thissubsection, the rates used shall include the actual rates charged by ruralcompanies that do not receive KUSF support.
(f) For regulatory reform plans in which price cap regulationhas been elected, price cap plans shall have three baskets:Residential and single-line business, including touch-tone;switched access services; and miscellaneous services. Thecommission shall establish price caps at the prices existing whenthe regulatory plan is filed subject to rate rebalancing asprovided in subsection (c) for residential services, includingtouch-tone services, and for single-line business services,including touch-tone services, within the residential andsingle-line business service basket. The commission shall establisha formula for adjustments to the price caps. The commission alsoshall establish price caps at the prices existing when theregulatory plan is filed for the miscellaneous services basket. Thecommission shall approve any adjustments to the price caps for themiscellaneous service basket, as provided in subsection (g).
(g) On or before January 1, 1997, the commission shallissuea final order in a proceeding to determine the price cap adjustmentformula that shall apply to the price caps for the localresidential and single-line business and the miscellaneous servicesbaskets and for sub-categories, if any, within those baskets. Indetermining this formula, the commission shall balance the publicpolicy goals of encouraging efficiency and promoting investment ina quality, advanced telecommunications network in the state. Thecommission also shall establish any informational filingrequirements necessary for the review of any price cap tarifffilings, including price increases or decreases within the caps, toverify such caps would not be exceeded by any proposed pricechange. The adjustment formula shall apply to the price caps forthe local residential and single-line business basket afterDecember 31, 1999, and to the miscellaneous services basket afterDecember 31, 1997. The price cap formula, but not actual prices,shall be reviewed every five years.
(h) The price caps for the residential and single-linebusiness service basket shall be capped at their initial leveluntil January 1, 2000, except for any increases authorized as apart of the revenue neutral rate rebalancing under subsection (c).The price caps for this basket and for the categories in thisbasket, if any, shall be adjusted annually after December 31, 1999,based on the formula determined by the commission under subsection (g).
(i) The price cap for the switched access service basket shallbe set based upon the local exchange carrier's intrastate accesstariffs as of January 1, 1997, except for any revenue neutral raterebalancing authorized in accordance with subsection (c).Thereafter, the cap for this basket shall not change except inconnection with any subsequent revenue neutral rebalancingauthorized by the commission under subsection (c).
(j) The price caps for the miscellaneous services basket shallbe adjusted annually after December 31, 1997, based on theadjustment formula determined by the commission under subsection (g).
(k) A price cap is a maximum price for all services taken asa whole in a given basket. Prices for individual services may bechanged within the service categories, if any, established by thecommission within a basket. An entire service category, if any,within the residential and single-line business basket ormiscellaneous services basket may be priced below the cap for suchcategory. Unless otherwise approved by the commission, no serviceshall be priced below the price floor which will be long-runincremental cost and imputed access charges. Access charges equalto those paid by telecommunications carriers to local exchangecarriers shall be imputed as part of the price floor for tollservices offered by local exchange carriers on a toll service basis.
(l) A local exchange carrier may offer promotions within anexchange or group of exchanges. All promotions shall be approved bythe commission and may notbe unjust, unreasonably discriminatory or unduly preferential.
(m) Unless the commission authorizes price deregulation at anearlier date, intrastate toll services within the miscellaneousservices basket shall continue to be regulated until the affectedlocal exchange carrier begins to offer 1+ intraLATA dialing paritythroughout its service territory, at which time intrastate tollwill be price deregulated, except that prices cannot be set belowthe price floor.
(n) On or before July 1, 1997, the commission shall establishguidelines for reducing regulation prior to price deregulation ofprice cap regulated services in the miscellaneous services basket,the switched access services basket, and the residential andsingle-line business basket.
(o) Subsequent to the adoption of guidelines pursuant to subsection (n), thecommission shall initiate a petitioning procedure under which the localexchange carrier may request rate range pricing. The commission shall act upona petition within 21 days, subject to a 30-dayextension.The prices within a rate range shall be tariffed and shall apply to allcustomers in a nondiscriminatory manner in an exchange or group of exchanges.
(p) A local exchange carrier may petition the commission todesignate an individual service or service category, if any, within themiscellaneous services basket, the switched access services basket or theresidential and single-line business basket for reduced regulation. Thecommission shall act upon a petition for reduced regulation within 21 days,subject to an extension period of an additional 30days, andupon a good cause showing of the commission in theextensionorder, or within such shorter time as the commission shall approve. Thecommission shall issue a final order within the 21-day period or within a51-day period if an extension has been issued.Following anorder granting reduced regulation of an individual service or service category,the commission shall act on any request for price reductions within seven dayssubject to a 30-day extension. The commission shallact onother requests for price cap adjustments, adjustments within price cap plansand on new service offerings within 21 days subject to a 30-dayextension. Such a change will be presumed lawful unless it isdetermined the prices are below the price floor or that the price cap for acategory, if any, within the entire basket has been exceeded.
(q) (1) Beginning July 1, 2006, price regulation of telecommunicationsservices in theresidential and single-line business service basket and the miscellaneousservices basket for localexchange carriers subject to price cap regulation shall be as follows:
(A) Packages or bundles of services shall be price deregulated statewide,however theindividual telecommunication service components of such packages or bundlesshall remainavailable for purchase on an individual basis at prices subject to price capregulation in anyexchange in which the standards in subsection (q)(1)(B), (C) or (D) have notbeen met. If standards in subsection (q)(1)(B), (C) or (D) have been met,the individual telecommunication service components of such packages orbundles shall remain available for purchase on an individual basis andprices for packages or bundles shall not exceed the sum of the highest pricesof the ala carte components of the package or bundle;
(B) in any exchange in which there are 75,000 or more local exchange accesslinesserved by all providers, rates for all telecommunications services shall beprice deregulated;
(C) in any exchange in which there are fewer than 75,000 local exchangeaccess linesserved by all providers, the commission shall price deregulate all businesstelecommunication services upon ademonstration by the requesting local telecommunications carrier that there aretwo or morenonaffiliated telecommunications carriers or other entities, that arenonaffiliated with the local exchange carrier, providing localtelecommunicationsservice to business customers, regardless of whether the entity provides localservice inconjunction with other services in that exchange area. One of suchnonaffiliated carriers or entities shall be required to be a facilities-basedcarrier or entity and not more than one of such nonaffiliated carriers orentities shall be a provider of commercial mobile radio services in thatexchange;
(D) in any exchange in which there are fewer than 75,000 local exchangeaccess linesserved by all providers, the commission shall price deregulate all residentialtelecommunication services upon ademonstration by the requesting local telecommunications carrier that there aretwo or morenonaffiliated telecommunications carriers or other entities, that arenonaffiliated with the local exchange carrier, providing localtelecommunicationsservice to residential customers, regardless of whether the entity provideslocal service in conjunction with other services in that exchange area. One ofsuch nonaffiliated carriers or entities shall be required to be afacilities-based carrier or entity and not more than one of such nonaffiliatedcarriers or entities shall be a provider of commercial mobile radio servicesin that exchange;
(E) rates for lifeline services shall remain subject to price cap regulation;
(F) up to and continuing until July 1, 2008, rates for the initialresidential local exchange access line and up tofour business local exchange access lines at one location shall remain subjectto price cap regulation.On and after July 1, 2008, the localexchange carrier shall be authorized to adjust such rates without commissionapproval by not more than the percentage increase in the consumer price indexfor all urban consumers, as officially reported by the bureau of laborstatistics of the United States department of labor, or its successor index, inany one year period and such rates shall not be adjusted below the price floorestablished in subsection (k).Such rates shall not be affected by purchase of one ormore of the following: Call management services, intraLATA long distanceservice or interLATA long distance service; and
(G) local exchange carriers shall offer a uniform price throughout each suchexchange for services subject to price deregulation, under this subsection,including packages or bundles of services, except as provided in subsection (1)or as otherwise approved by the commission.
(2) For the purposes of this subsection:
(A) Any entity providing voice service shall be considered as a localtelecommunications service provider regardless of whether such entity issubject to regulation by the commission;
(B) a provider of local telecommunications service that requires the use of athird party, unaffiliated broadband network or dial-up internet network for theorigination of local voice service shall not be considered a localtelecommunications service provider;
(C) telecommunications carriers offering only prepaid telecommunicationsservice shall not be considered entities providing local telecommunicationsservice.
(3) If the services of a local exchange carrier are classified as pricederegulated under this subsection, the carrier may thereafter adjust its ratesfor such price deregulated services upward or downward as it determinesappropriate in its competitive environment, with tariffs for such servicesdeemed effective upon filing with the commission.Price deregulated services shall be subject to the price floor in subsection(k), and shall not be unreasonably discriminatory or unduly preferential withinan exchange.
(4) The commission shall act upon a petition filed pursuant to subsection(q)(1)(C) or (D) within 21 days, subject to an extension period of anadditional 30 days, and upon a good cause showing of the commission in theextension order, or within such shorter time as the commission shall approve.The commission shall issue a final order within the 21-day period or within a51-day period if an extension order has been issued.
(5) The commission may resume price cap regulation of a local exchangecarrier, deregulated under this subsection upon finding, after a hearing, thatsuch carrier has: Violated minimum quality of service standards pursuant tosubsection (1) of K.S.A. 66-2002, and amendments thereto; been given reasonablenotice and an opportunity to correct the violation; and failed to do so.
(6) The commission on July 1, 2006, and on each date that any service isderegulated, shall record the rates of each service which has been pricederegulated in each exchange.
(7) Prior to January 1, 2007, the commission shall determine the weighted,statewide average rate of nonwireless basic local telecommunications service asof July 1, 2006. Prior to January 1, 2007, and annually thereafter,the commission shall determine the weighted, average rate of nonwireless basiclocal telecommunications services in exchanges that have been price deregulatedpursuant to subsection (q)(1)(B), (C) or (D). The commission shall report itsfindings on or before February 1, 2007, and annually thereafter to thegovernor, the legislature and each member of the standing committees of thehouse of representatives and the senate which are assigned telecommunicationsissues. The commission shall also provide insuch annual report any additional information it deems useful in determiningthe impact of price deregulation on consumers and the competitive environment,including, but not limited to, the rates recorded under paragraph (6) of thissubsection, the current rates for services in price deregulated exchanges,changes in service offerings available in price deregulated exchanges and thechange in the number of competitors in price deregulated exchanges. If thecommission finds that the weighted,average rate of nonwireless basic local telecommunications service, inexchanges that havebeen price deregulated pursuant to subsection (q)(1)(B), (C) or (D) in anyone year period is greater than the weighted, statewide average rate ofnonwireless basic local telecommunications service as of July 1,2008,multiplied by one plus the percentage increase in the consumer price index forgoods and services for the study periods, or the commission believes thatchanges in state law are warranted due to the status of competition, thecommission shall recommend to thegovernor, the legislature and each member of the standing committees of thehouse of representatives and the senate which are assigned telecommunicationsissues such changes in state law as the commission deemsappropriate and the commission shall also send a report of such findings toeach member of the legislature.
(8) For the purposes of this subsection:
(A) "Packages or bundles of services" means the offering of a localtelecommunicationsservice with one or more of the following, subscribed together, as one serviceoption offered atone price, one or more call management services, intraLATA long distanceservice, interLATA long distance service, internet access, video services orwireless services. Packages or bundles ofservices shall not include only a single residential local exchange access lineor up to four business local exchange access lines at one location andintraLATAlong distance service or interLATA long distance service, or both;
(B) "local telecommunications service" means two-way voice service capable ofbeing originated and terminated within the exchange of the local exchangetelecommunicationscompany seeking price deregulation of its services, regardless of thetechnology used to provisionthe voice service;
(C) "broadband network" means a connection that delivers services at speedsexceedingtwo hundred kilobits per second in both directions;
(D) "prepaid telecommunications service" means a local service for whichpayment ismade in advance that excludes access to operator assistance and long distanceservice;
(E) "facilities based carrier" means a telecommunications carrier or entityproviding local telecommunications service either wholly or partially over itsownnetwork. Facilities based carrier shall not include any radio communicationservices provider licensed by the federal communications commission to providecommercial mobile radio services; and
(F) "call management services" means optional telecommunications servicesthat allow a customer to manage call flow generated over the customer's localexchange access line.
(r) (1) Upon complaint or request, the commission may investigate apricederegulated service.
(2) The commission shall resume price cap regulation of a service provided inany exchange area by placing it in the appropriate service basket, as approvedby the commission, upon a determination by the commission that the conditionsin subsection (q)(1)(C) or (D) are no longer satisfied in that exchange area.
(3) The commission shall resume price cap regulation of business services inany exchange meeting the conditions of subsection (q)(1)(B) by placing it inthe appropriate service basket, as approved by the commission, upon adetermination by the commission that the following condition is not met: Thereare at least two nonaffiliated telecommunications carriers or other entities,that are nonaffiliated with the local exchange carrier, providing localtelecommunications service to business customers, regardless of whether theentity provides local service in conjunction with other services in thatexchange area. One of such nonaffiliated carriers or entities shall be requiredto be a facilities-based carrier or entity and not more than one suchnonaffiliated carriers or entities shall be a provider of commercial mobileradio services in that exchange.
(4) The commission shall resume price cap regulation of residential servicesin any exchange meeting the conditions of subsection (q)(1)(B) by placing it inthe appropriate service basket, as approved by the commission, upon adetermination by the commission that the following condition is not met: Thereare at least two or more nonaffiliated telecommunications carriers or otherentities, that are nonaffiliated with the local exchange carrier, providinglocal telecommunications service to residential customers, regardless ofwhether the entity provides local service in conjunction with other services inthat exchange area. One of such nonaffiliated carriers or entities shall berequired to be a facilities-based carrier or entity and not more than one suchnonaffiliated carriers or entities shall be a provider of commercial mobileradio services in that exchange.
(s) The commission shall require that for all local exchangecarriers all such price deregulated basic intraLATA toll servicesbe geographically averaged statewide and not be priced below theprice floor established in subsection (k).
(t) Cost studies to determine price floors shall be performedas required by the commission in response to complaints. Inaddition, notwithstanding the exemption in subsection (b), thecommission may request information necessary to execute any of itsobligations under the act. In response to a complaint that a pricederegulated service is priced below the price floor set forth in subsection(k), the commission shall issue an order within 60 days after the filing of thecomplaint unless the complainant agrees to an extension.
(u) A local exchange carrier may petition for individualcustomer pricing. The commission shall respond expeditiously to thepetition within a period of not more than 30 days subject to a 30-dayextension.
(v) No audit, earnings review or rate case shall be performedwith reference to the initial prices filed as required herein.
(w) Telecommunications carriers shall not be subject to priceregulation, except that: Access charge reductions shall be passedthrough to consumers by reductions in basic intrastate toll prices;and basic toll prices shall remain geographically averagedstatewide. As required under K.S.A. 66-131, and amendments thereto,and except as provided for in subsection (c) of K.S.A. 66-2004, and amendmentsthereto, telecommunications carriers that were not authorized toprovide switched local exchange telecommunications services in thisstate as of July 1, 1996, including cable television operators whohave not previously offered telecommunications services, mustreceive a certificate of convenience based upon a demonstration oftechnical, managerial and financial viability and the ability tomeet quality of service standards established by the commission.Any telecommunications carrier or other entity seeking suchcertificate shall file a statement, which shall be subject to thecommission's approval, specifying with particularity the areas inwhich it will offer service, the manner in which it will providethe service in such areas and whether it will serve both businesscustomers and residential customers in such areas. Any structurallyseparate affiliate of a local exchange carrier that providestelecommunications services shall be subject to the same regulatoryobligations and oversight as a telecommunications carrier, as longas the local exchange carrier's affiliate obtains access to anyservices or facilities from its affiliated local exchange carrieron the same terms and conditions as the local exchange carriermakes those services and facilities available to othertelecommunications carriers. The commission shall overseetelecommunications carriers to prevent fraud and other practicesharmful to consumers and to ensure compliance with quality ofservice standards adopted for all local exchange carriers andtelecommunications carriers in the state.
