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Title 58 - Public Utilities, Services and Carriers

CHAPTER 9.

TELEPHONE, TELEGRAPH AND EXPRESS COMPANIES

ARTICLE 1.

TELEPHONE COMPANIES--GENERAL PROVISIONS

SECTION 58-9-10. Definitions.

When used in Articles 1 through 13 of this chapter:

(1) The term "Commission" means the Public Service Commission;

(2) The term "commissioner" means one of the members of the Commission;

(3) The term "corporation" includes all bodies corporate, joint stock companies or associations, domestic or foreign, their lessees, assignees, trustees, receivers or other successors in interest, having any of the power or privileges of corporations not possessed by individuals or partnerships;

(4) The term "person" includes all individuals, partnerships or associations other than corporations;

(5) The term "public" means the public generally or any limited portion of the public, including a person or corporation;

(6) The term "telephone utility" includes persons and corporations, their lessees, assignees, trustees, receivers or other successors in interest owning or operating in this State equipment or facilities for the transmission of intelligence by telephone for hire, including all things incident thereto and related to the operation of telephones;

(7) The term "rate" means and includes every compensation, charge, toll, rental and classification, or any of them, demanded, observed, charged or collected by any telephone utility for any communications service offered by it to the public and any rules, regulations, practices or contracts affecting any such compensation, charge, toll, rental or classification; and

(8) The term "securities" means and includes stock, stock certificates, bonds, notes, debentures, or other evidences of indebtedness, and any assumption or guaranty thereof.

(9) The term "basic local exchange telephone service" means for residential and single-line business customers, access to basic voice grade local service with touchtone, access to available emergency services and directory assistance, the capability to access interconnecting carriers, relay services, access to operator services, and one annual local directory listing (white pages or equivalent).

(10) The term "carrier of last resort" means a facilities-based local exchange carrier, as determined by the commission, not inconsistent with the federal Telecommunications Act of 1996, which has the obligation to provide basic local exchange telephone service, upon reasonable request, to all residential and single-line business customers within a defined service area. Initially, the incumbent LEC must be a carrier of last resort within its existing service area.

(11) The term "incumbent local exchange carrier" or "incumbent LEC" means a telecommunications company, its affiliates, successors, or its assigns, which provide local exchange service pursuant to a certificate of public convenience and necessity issued by the commission before July 1, 1995, or operating as a local exchange carrier before that date pursuant to commission authority, to provide local exchange service within a certificated geographic service area of the State. Any such entity must be treated as the incumbent local exchange carrier only within the geographic area where it maintains service pursuant to:

(a) any certificate of public convenience and necessity issued before July 1, 1995; or

(b) any certificate of public convenience and necessity issued to supersede, in whole or in part, any certificate of public convenience and necessity issued before July 1, 1995.

(12) The term "local exchange carrier" or "LEC" means either an incumbent local exchange carrier or a new entrant local exchange carrier.

(13) The term "new entrant local exchange carrier" or "new entrant LEC" means a telecommunications company holding a certificate of public convenience and necessity issued by the commission pursuant to Section 58-9-280 (B) after December 31, 1995, to provide local exchange service within a certificated geographic service area of the State.

(14) The term "small local exchange carrier" or "small LEC" means a rural telephone company as defined on February 8, 1996, in the federal Telecommunications Act of 1996.

(15) The term "telecommunications services" means the services for the transmission of voice and data communications to the public for hire, including those nonwireline services provided in competition to landline services.

(16) The term "universal service" means the providing of basic local exchange telephone service, at affordable rates, upon reasonable request, to all residential and single-line business customers within a defined service area.

(17) The term "broadband service" means any service that is used to deliver video or to provide access to the Internet and that consists of the offering of:

(a) a capability to transmit information at a rate that is generally not less than one hundred ninety kilobits per second in at least one direction; or

(b) any service that combines computer processing, information storage, and protocol conversion to enable users to access Internet content and services.

(18) The term "regulatory staff" means the executive director or the executive director and the employees of the Office of Regulatory Staff.

SECTION 58-9-20. Companies subject to Articles 1 through 13 of this chapter even before commencing operations.

Corporations formed to acquire property or to transact business which would be subject to the provisions of Articles 1 through 13 of this chapter and corporations possessing franchises, powers or privileges for any of the purposes contemplated by Articles 1 through 13 of this chapter shall be deemed to be subject to the provisions of Articles 1 through 13 of this chapter, although no property may have been acquired, business transacted or franchises, powers or privileges exercised.

SECTION 58-9-30. Municipal rights, powers and privileges under Constitution not impaired.

Nothing contained in Articles 1 through 13 of this chapter shall be so construed as to modify, abridge, or impair any of the rights or powers granted to cities and towns under any provision of the Constitution of this State and every right, power or privilege conferred upon any city or town by the Constitution of this State otherwise appearing to be modified, abridged or impaired by any provision of Articles 1 through 13 of this chapter is to be deemed excepted from the operation thereof.

SECTION 58-9-40. Municipal police regulations and ordinances not affected.

Nothing contained in Articles 1 through 13 of this chapter shall be so construed as to limit or restrict the right of cities and towns to adopt and enforce reasonable police regulations and ordinances affecting telephone utilities, not inconsistent with the provisions of Articles 1 through 13 of this chapter, in the interest of public safety, morals, convenience, health and good order.

SECTION 58-9-50. Articles 1 through 13 of this chapter not applicable to interstate commerce.

No provision of Articles 1 through 13 of this chapter shall apply or be construed to apply to commerce among the several states of the United States, except in so far as such application may be permitted under the provisions of the Constitution of the United States and the acts of Congress.

ARTICLE 3.

TELEPHONE COMPANIES - DUTIES, RESTRICTIONS AND RIGHTS GENERALLY

SECTION 58-9-200. Definitions.

As used in Sections 58-9-295 and 58-9-297:

(1) "Communications service provider" means:

(a) a telephone utility as defined in Section 58-9-10(6);

(b) a government-owned telecommunications service provider as defined in Section 58-9-2610(1);

(d) a person or entity providing telephone, voice over internet protocol, similar voice service, or any other voice replacement service, data service, video service, or any information service; or

(e) an entity using or allowing another entity to use its cable, wires, fiber, or any material, facilities, or equipment that have the ability to carry voice, data, video, or any other information transmissions.

"Communications service provider" does not mean a radio common carrier as defined in Section 58-11-10(f).

(2) "Communications service" means:

(a) telephone service, including without limitation basic local exchange telephone service as defined in Section 58-9-10(9);

(b) voice over internet protocol, or similar voice or voice replacement service;

(d) video service; or

(e) any information service.

Prohibited agreements; civil penalties

SECTION 58-9-210. Rates shall be just and reasonable.

Every rate made, demanded or received by any telephone utility or by any two or more telephone utilities jointly shall be just and reasonable.

SECTION 58-9-220. Repealed by 1983 Act No. 138 Section 21, eff June 15, 1983.

SECTION 58-9-230. Schedules shall be adhered to.

(A) No telephone utility may directly or indirectly, by any device whatsoever or in any way, charge, demand, collect, or receive from any person or corporation a greater or less compensation for any service rendered or supplied, or to be rendered or supplied, by the telephone utility, than that prescribed in the schedules of the telephone utility applicable thereto then filed in the manner provided in Articles 1 through 13 of this chapter, nor may any person or corporation receive or accept any service from a telephone utility for a compensation greater or less than that prescribed in the schedules.

(B) Local exchange company centrex-type services or billing and collection services, or both, may be offered to subscribers without the schedules related thereto being filed as provided in subsection (A), if the Commission, after hearing, first determines that such services are subject to competition in the relevant product and geographic markets. The Commission shall retain regulatory authority, however, over the rates, revenues, investments, expenses, and quality of the services so offered.

(C) The charges for services offered by the utility pursuant to subsection (B) must, in every instance, be provided at a level above the cost of the service as determined by the commission. The regulatory staff shall have access to such data to ensure compliance with this section. The cost data is not subject to disclosure to the public. However, upon the application of any interested party and for good cause shown, the commission may enter an appropriate order which directs the manner in which the proprietary cost data provided to the regulatory staff may be made available to such interested party.

(D) When a local exchange company proposes to offer a service pursuant to subsections (B) and (C), the Commission shall first determine:

(1) whether monopoly elements are offered as part of the centrex-type service; and

(2) if the Commission finds the existence of a monopoly element, then it must decide whether or not that monopoly element should be unbundled from the detariffed service. If they find that the monopoly element should be unbundled, then only the competitive elements of that service may be detariffed.

(3) This section does not amend or repeal the provisions of Section 58-9-250.

SECTION 58-9-240. Permitted free or reduced rates.

Nothing herein contained shall prevent any telephone utility from granting free or reduced rate service to its officers, agents, employees, attorneys, physicians or surgeons, nor to prevent any telephone utility from granting free or reduced rate service to the State of South Carolina or any municipality therein or department thereof or to charitable and eleemosynary institutions and persons engaged in charitable and eleemosynary work, nor to prevent any telephone utility from granting free or reduced rate service with the object and for the purpose of providing relief in times and cases of flood, general epidemic, pestilence or other calamitous visitation, nor any such other instance when the Commission may deem that such service is not contrary to the public interest; provided, that such free or reduced rate service shall be granted in accordance with tariffs filed by such telephone utility with the Commission and which shall be subject to regulation and revision by the Commission in the same manner as other rates of telephone utilities. The terms "officers" and "employees" as used in this section shall include furloughed, pensioned and superannuated officers and employees of any such utility.

SECTION 58-9-250. Unreasonable preferences and differences in rates or service shall not be made; reasonable classifications may be established.

No telephone utility shall, as to rates or services, make or grant any unreasonable preference or advantage to any person or corporation or subject any person or corporation to any unreasonable prejudice or disadvantage. No telephone utility shall establish or maintain any unreasonable difference as to rates or service, either as between localities or as between classes of service. Subject to the approval of the Commission, however, telephone utilities may establish classifications of rates and services and such classifications may take into account the conditions and circumstances surrounding the service, such as the time when used, the purpose for which used, the demand upon plant facilities, the value of the service rendered or any other reasonable consideration. The Commission may determine any question arising under this section.

SECTION 58-9-260. Facilities and equipment shall be maintained in adequate manner.

Every telephone utility shall provide and maintain facilities and equipment to furnish reasonably adequate and efficient telephone service to its customers in this State.

SECTION 58-9-270. Extensions of existing facilities.

When ordered by the commission after notice to other interested telephone utilities and the public and due hearing any telephone utility may be required to establish, construct, maintain, and operate any reasonable extension of its existing facilities. If any such extension, however, by any telephone utility of its existing facilities will interfere with the service or system of any other telephone utility, the commission may on petition and after hearing either order the discontinuance of such extension or prescribe such terms and conditions with respect thereto as may be just and reasonable.

SECTION 58-9-280. Certificate of public convenience and necessity shall be obtained prior to construction, operation or extension of plant or system; exceptions.

(A) No telephone utility shall begin the construction or operation of any telephone utility plant or system, or of any extension thereof, except those ordered by the commission under the provisions of Section 58-9-270, without first obtaining from the commission a certificate that public convenience and necessity require or will require such construction or operation. But this section shall not be construed to require any telephone utility to secure a certificate for any extension within any municipality or district within which it had lawfully commenced operations on June 16, 1950, or for an extension within or to territory already served by it, necessary in the ordinary course of its business, or for an extension into territory contiguous to that already occupied by it as defined by the commission and not receiving similar service from another telephone utility; but, if any telephone utility in constructing or extending its lines, plant, or system unreasonably interferes or is about to interfere unreasonably with the service or system of any other telephone utility, the commission may make such order and prescribe such terms and conditions in harmony with Articles 1 through 13 of this chapter as are just and reasonable.

(B) After notice and an opportunity to be heard, the commission may grant a certificate to operate as a telephone utility, as defined in Section 58-9-10(6), to applicants proposing to furnish local telephone service in the service territory of an incumbent LEC, subject to the conditions and exemptions stated in this section and in applicable federal law. The provisions of this act shall apply to any such application for a certificate pending before the commission on the effective date of this act; provided, however, that any carrier filing an application to furnish telecommunications service as a private line or special access service provider or as a carrier's carrier prior to March 25, 1996, may elect to comply with the certification requirements in effect on that date rather than those contained within this subsection (B); provided, further, however, that such carrier shall comply with subsection (B)(4) hereof. In determining whether to grant a certificate under this subsection, the commission may require, not inconsistent with the federal Telecommunications Act of 1996, that the:

(1) applicant show that it possesses technical, financial, and managerial resources sufficient to provide the services requested;

(2) service to be provided will meet the service standards that the commission may adopt;

(3) provision of the service will not adversely impact the availability of affordable local exchange service;

(4) applicant, to the extent it may be required to do so by the commission, will participate in the support of universally available telephone service at affordable rates; and

(5) provision of the service does not otherwise adversely impact the public interest.

In its application for certification, the applicant seeking to provide the service shall set forth with particularity the proposed geographic territory to be served, and a price list and informational tariff regarding the types of local exchange and exchange access services to be provided. Any person granted authority under this section shall maintain a current price list with the commission and the Office of Regulatory Staff. A commission order, denying or approving an application for certification of a new local telephone service provider, shall be entered no more than sixty days from the filing of the application, except that the commission, upon notice, may extend that period not to exceed an additional sixty days.

(C) The commission shall determine the requirements applicable to all local telephone service providers necessary to implement this subsection. These requirements shall be consistent with applicable federal law and shall:

(1) provide for the reasonable interconnection of facilities between all certificated local telephone service providers upon a bona fide request for interconnection, subject to the negotiation process set forth in subsection (D) of this section;

(2) provide for the transfer of telephone numbers between local telephone service providers in a manner that is technically feasible;

(3) provide for the reasonable unbundling of network elements upon a request from a LEC where technically feasible and priced in a manner that recovers the providing LEC's cost;

(4) determine, for small LEC's, when and under what circumstances resale of local exchange telephone services is in the public interest and should be allowed. Telecommunications services that are available at retail to a specific category of subscribers only shall not be offered for resale to a different category of subscribers; and

(5) provide for the continued development and encouragement of universally available basic local exchange telephone service at reasonably affordable rates.

The final commission order implementing these requirements shall be issued within six months of the effective date of this section, except that the commission, upon notice, may extend that period up to an additional ninety days.

(D) A LEC shall negotiate the rates, terms, and conditions for local interconnection. In the event that the parties are unable to agree on appropriate rates, terms, and conditions for interconnection within one hundred thirty-five to one hundred sixty days of receipt of a bona fide request, either party may petition the commission for determination of the appropriate rates, terms, and conditions for interconnection. This period may be shortened or extended by mutual agreement of the parties. The commission shall determine the appropriate rates, terms, and conditions for interconnection within nine months from the filing of the petition in accordance with the terms of applicable federal law. The regulatory staff shall represent the public interest in any matter undertaken pursuant to this subsection unless the Executive Director of the Office of Regulatory Staff chooses to opt out as a participant pursuant to Section 58-4-50.

(E) In continuing South Carolina's commitment to universally available basic local exchange telephone service at affordable rates and to assist with the alignment of prices and/or cost recovery with costs, and consistent with applicable federal policies, the commission shall establish a universal service fund (USF) for distribution to a carrier(s) of last resort. The commission shall issue its final order adopting such guidelines as may be necessary for the funding and management of the USF within twelve months of the effective date of this section except that the commission, upon notice, may extend that period up to an additional ninety days. These guidelines must not be inconsistent with applicable federal law and shall address, without limitation, the following:

(1) The USF shall be administered by the Office of Regulatory Staff or a third party designated by the Office of Regulatory Staff under guidelines to be adopted by the commission.

(2) The commission shall require all telecommunications companies providing telecommunications services within South Carolina to contribute to the USF as determined by the commission.

(3) The commission also shall require any company providing telecommunications service to contribute to the USF if, after notice and opportunity for hearing, the commission determines that the company is providing private local exchange services or radio-based local exchange services in this State that compete with a local telecommunications service provided in this State.

(4) The size of the USF shall be determined by the commission and shall be the sum of the difference, for each carrier of last resort, between its costs of providing basic local exchange services and the maximum amount it may charge for the services. The commission may use estimates to establish the size of the USF on an annual basis, provided it establishes a mechanism for adjusting any inaccuracies in the estimates.

(5) Monies in the USF shall be distributed to a carrier of last resort upon application and demonstration of the amount of the difference between its cost of providing basic local exchange services and the maximum amount it may charge for such services.

(6) The commission shall require any carrier of last resort seeking reimbursement from the fund to file with the commission and provide to the Office of Regulatory Staff the information necessary to determine the costs of providing basic local exchange telephone services. In the event that a carrier of last resort does not currently conduct detailed cost studies relating to such services, the commission shall allow for an appropriate surrogate for such study.

(7) The commission shall have the authority to make adjustments to the contribution or distribution levels based on yearly reconciliations and to order further contributions or distributions as needed.

(8) After notice and an opportunity for hearing to all affected carriers and the Office of Regulatory Staff, the commission by rule may expand the set of services within the definition of universal service based on a finding that the uniform statewide demand for such additional service is such that including the service within the definition of universal service will further the public interest; provided, however, that before implementing any such finding, the commission shall provide for recovery of unrecovered costs through the USF of such additional service by the affected carrier of last resort.

(9) Nothing in subsection (G) of this section shall preclude the commission from assessing broadband service revenues for purposes of contributions to the USF, pursuant to this subsection.

(F) Nothing in this chapter shall be interpreted to limit or restrict any right that any local exchange carrier may have under federal law.

(G)(1) Competition exists for a particular service if, for an identifiable class or group of customers in an exchange, group of exchanges, or other clearly defined geographical area, the service, its functional equivalent, or a substitute service is available from two or more providers. The commission must not:

(a) impose any requirements related to the terms, conditions, rates, or availability of broadband service; or

(b) otherwise regulate broadband service; however, in order to facilitate the continued deployment of broadband service by rural telephone companies as defined in 47 U.S.C. Section 153 (37), facilities utilized by rural telephone companies for the provision of broadband service must continue to be treated by the commission in the same manner as they were treated as of January 1, 2003, so as not to impact the provision or pricing of regulated telecommunications services by rural telephone companies. The commission shall not regulate a service for which competition exists if the market for that service is sufficiently competitive to protect the public interest. If the commission finds that competition exists for a particular service, but that service is not sufficiently competitive to protect the public interest, the commission must provide appropriate regulatory and pricing flexibility to all providers of the service.

(2) Nothing in subsection (G)(1) of this section is intended to affect the Public Service Commission's jurisdiction with respect to any service other than broadband service or to affect the application of access rates and charges to broadband providers or with respect to broadband services. Nothing in subsection (G)(1) of this section shall be construed to relieve an incumbent local exchange carrier, as defined by Section 251(h) of the federal Telecommunications Act of 1996, of its obligations pursuant to Sections 251 and 252 of the federal act or any Federal Communications Commission regulation relating to Sections 251 and 252 of the federal act to provide new entrant LEC's with unbundled access to network elements or interconnection including, but not limited to, loops, subloops, transmission facilities, and collocation space.

(3) The Office of Regulatory Staff must compile information in order to monitor the status of local telephone competition in this State. In compiling this information, the Office of Regulatory Staff must require all local exchange carriers, as defined in Section 58-9-10(12), to report to the Office of Regulatory Staff annually, the total number of access lines providing local exchange telecommunications services to an end user in this State. The Office of Regulatory Staff must also maintain a copy of all written complaints received regarding the impact broadband services may be having on the competitive local exchange market. This information must be compiled and made available prior to May fifteenth of each year.

(H) Any local exchange carrier, upon a showing of changed circumstances or that it is necessary or appropriate to realign rates with the costs of various telecommunications components, may petition the commission to reexamine any rates that have been capped pursuant to the provisions of this chapter and to set new price caps. A copy of the petition must be served upon the Office of Regulatory Staff.

(I) The incumbent LEC's subject to this section shall be authorized to meet the offerings of any local exchange carrier serving the same area by packaging services together, using volume discounts and term discounts, and by offering individual contracts for services, except as restricted by federal law. Individual contracts for services or contracts with other providers of telecommunications services shall not be filed with the commission, except as required by federal law, provided that telecommunications carriers shall provide access to such contracts to the commission as required.

(J) Subject to the requirements of applicable federal law, a small LEC may define the term "cost", as used within this section and where applicable to a small LEC, to include all embedded costs as well as a reasonable contribution to universal local service, where applicable, until such time as these costs are recovered from other sources.

(K) Subject to federal law, if the commission finds that the resale of any service or unbundled capability, element, feature, or function in a small LEC area is in the public interest, then the small LEC shall not be required to offer its services at a price below its cost.

(L) Upon enactment of this section and the establishment of the Interim LEC Fund, as specified in subsection (M) of this section, the commission shall, subject to the requirements of federal law, require any electing incumbent LEC, other than an incumbent LEC operating under an alternative regulation plan approved by the commission before the effective date of this section, to immediately set its toll switched access rates at levels comparable to the toll switched access rate levels of the largest LEC operating within the State. To offset the adverse effect on the revenues of the incumbent LEC, the commission shall allow adjustment of other rates not to exceed statewide average rates, weighted by the number of access lines, and shall allow distributions from the Interim LEC Fund, as may be necessary to recover those revenues lost through the concurrent reduction of the intrastate switched access rates.

(M) The commission shall, not later than December 31, 1996, establish an Interim LEC Fund to be administered by the Office of Regulatory Staff or a designee. The Interim LEC Fund shall initially be funded by those entities receiving an access or interconnection rate reduction from LEC's pursuant to subsection (L) in proportion to the amount of the rate reduction. To the extent that affected LEC's are entitled to payments from the USF, the Interim LEC Fund must transition into the USF as outlined in Section 58-9-280(E) when funding for the USF is finalized and adequate to support the obligations of the Interim LEC Fund.

(N) The commission shall ensure that any requirements implemented under Section 58-9-280(C) are appropriate for the service territory of the small LEC and may implement such alternative requirements necessary to protect the public interest in such service area. Specifically, the commission shall ensure for small LEC's that telecommunications services that are available at retail to a specific category of subscribers only shall not be offered for resale to a different category of subscribers. Additionally, consistent with the federal Telecommunications Act of 1996, LEC's shall not be required to offer for resale services which they do not make available on a retail basis.

(O) If any provision or section of this chapter is held invalid or held not to apply to a particular local exchange carrier, such holding shall not affect the remaining provisions of this chapter or their application to any local exchange carrier to which they might apply.

SECTION 58-9-285. Regulation of bundled offerings.

(A) As used in this section:

(1) "Bundled offering" means:

(a) for a qualifying LEC, an offering of two or more products or services to customers at a single price provided that:

(i) the bundled offering must be advertised and sold as a bundled offering at rates, terms, or conditions that are different than if the services are purchased separately from the LEC's tariffed offerings;

(ii) each regulated product or service in the offering is available on a stand-alone basis under a tariff on file with the commission; and

(iii) the qualifying LEC has a tariffed flat-rated local exchange service offering for residential customers and for single-line business customers on file with the commission that provides access to the services and functionalities set forth in Section 58-9-10(9).

(b) for a qualifying IXC, an offering of two or more products or services to customers at a single price provided that:

(ii) each regulated product or service in the offering is available on a stand-alone basis under a tariff on file with the commission.

(2) "Contract offering" means any contractual agreement, memorialized in writing, by which a qualifying LEC or a qualifying IXC offers any tariffed product or service to any customer at rates, terms, or conditions that differ from those set forth in the qualifying LECs or qualifying IXCs tariffs.

(3) "Qualifying IXC" means any interexchange carrier operating under alternative means of regulation authorized by the commission.

(4) "Qualifying LEC" means any LEC operating under an alternative means of regulation pursuant to Section 58-9-575; any LEC that has elected to have rates, terms, and conditions for its services determined pursuant to the plan described in Section 58-9-576(B); and any LEC that has elected to have rates, terms, and conditions determined pursuant to alternative means of regulation under Section 58-9-577.

(B) The commission must not:

(1) impose any requirements related to the terms, conditions, rates, or availability of any bundled offering or contract offering of any qualifying LEC or qualifying IXC that a customer accepts after the effective date of this act; or

(2) otherwise regulate any bundled offering or contract offering of any qualifying LEC or qualifying IXC that a customer accepts after the effective date of this act. Without limiting the foregoing, upon the filing of a complaint by an end use purchaser of a bundled offering or a contract offering, the commission may enforce the terms and conditions of a bundled offering or a contract offering under the same principles that apply when a court of general jurisdiction enforces the terms and conditions of an unregulated contract between two parties. No person or entity other than the end user purchaser that filed the complaint and the qualifying LEC or qualifying IXC that provides the bundled offering or contract offering that is the subject of such complaint shall be a party to any such complaint proceeding before the commission.

(C) A qualifying LEC or qualifying IXC providing bundled offerings or contract offerings is obligated to provide contributions to the Universal Service Fund (USF), and the commission shall ensure that contributions to the state USF, pursuant to Section 58-9-280(E), are maintained at appropriate levels. Nothing in this section affects the commission's jurisdiction over distributions from the USF pursuant to Section 58-9-280(E).

(D) Access minutes of use must continue to be classified and reported for purposes of administering the Interim LEC Fund, pursuant to Section 58-9-280(M), in the same manner as they were classified and reported before the effective date of this subsection.

(E) Nothing in this section affects any jurisdiction conferred upon the commission by 47 U.S.C. Section 254(k).

(F) Nothing in this section affects the commission's jurisdiction over complaints alleging that a change in a subscriber's selection of a provider of telecommunications service was made without appropriate authorization or that services that the customer did not order appear on the customer's bill.

(G) The State Regulation of Public Utilities Review Committee may request the Office of Regulatory Staff to compile information to enable the review committee to monitor the effect of bundled offerings and contract offerings on the provision of telecommunications services in South Carolina.

Election as to regulation of a local exchange carrier

SECTION 58-9-290. Interchange of service.

Telephone utilities may contract with each other for the connection of their respective lines or systems and for the interchange through such connections of public telephone and communications service and for other proper purposes. A copy of every such contract shall be filed with the commission and provided to the Office of Regulatory Staff. Such contract shall remain in effect in accordance with its terms unless the commission, after notice and hearing, shall find that such contract is contrary to the public interest and shall disapprove it.

SECTION 58-9-295. Agreements limiting other communications providers from access to rights-of-way prohibited; penalties.

(A) No communications service provider or a parent company, subsidiary, or affiliate of a communications service provider shall enter into any contract, agreement, or arrangement, oral or written, with a person or entity that:

(1) requires a person or entity to restrict or limit the ability of any other communications service provider from obtaining easements or rights-of-way for the installation of facilities or equipment to provide communications services in this State or otherwise deny or restrict access to the real property by any other communications service provider; or

(2) offers or grants incentives or rewards to an owner of real property or the owner's agent that are contingent upon restricting or limiting the ability of any other communications service provider from obtaining easements or rights-of-way for the installation of facilities or equipment to provide communications services in this State or otherwise denying or restricting access to the real property by any other communications service provider.

(B)(1) Nothing in this section prohibits a communications service provider and a user or prospective user of communications service from entering into an agreement with respect to the user or prospective user's own communications service.

(2) Nothing in this section prohibits an owner of real property or the owner's agent from entering into agreements with one or more communications service providers for the purpose of marketing a communications service to the owner of real property or to the tenants of real property, so long as such agreements are not in violation of subsection (A).

(3) This section does not affect a franchise agreement or other agreement with a municipality concerning the use of public streets, public rights-of-way, or other public property.

(C) All contracts, agreements, or arrangements in violation of subsection (A) made on or after the effective date of this section are void and unenforceable.

(D) A communications service provider who violates the provisions of this section is subject to a monetary penalty as provided in Section 58-9-1610. Each day that a contract, agreement, or arrangement prohibited by this section remains in force or effect shall constitute a separate violation as provided in Section 58-9-1620.

SECTION 58-9-297. Relief from obligation to provide communications services.

(A) No other communications service provider, including without limitation a carrier of last resort as defined in Section 58-9-10(10), shall be obligated to provide any communications service to the occupants of the property described herein if an owner or developer of any multi-tenant business or residential property, including without limitation apartments, condominiums, subdivisions, office buildings, or office parks:

(1) permits only one communications service provider to install its facilities or equipment during the construction phase of the property;

(2) accepts or agrees to accept incentives or rewards from a communications service provider to the owner, developer, or occupants of the property that are contingent upon the provision of communications service by that communications service provider to the exclusion of other providers of communications service;

(3) collects from the occupants of the property charges for the provision of communications service to the occupants in any manner, including without limitation through rent, fees, or dues; or

(4) enters into an agreement with a communications service provider that is in violation of Section 58-9-295.

(B) If any communications service provider is relieved of an obligation to provide communications service to occupants of property pursuant to subsection (A), the communications service provider may voluntarily provide communications services to the occupants of that property, and the public service commission must not impose any requirements related to the terms, conditions, rates, or availability of this service.

SECTION 58-9-300. Abandonment of service.

No telephone utility shall abandon all or any portion of its service to the public, except for ordinary discontinuance of service for nonpayment of a lawful charge or for violation of rules and regulations approved by the commission, unless written application is first made to the commission for the issuance of a certificate authorizing such abandonment, nor until the commission in its discretion issues such certificate. Any application must also be served on the Office of Regulatory Staff at the same time it is filed with the commission.

SECTION 58-9-310. Sale or other disposition of property, powers, franchises or privileges.

No telephone utility, without the approval of the Commission after due hearing and compliance with all other existing requirements of the laws of the State in relation thereto, may sell, transfer, lease, consolidate, or merge its property, powers, franchises, or privileges or any of them; provided, however, that a telephone cooperative association may acquire or incorporate a subsidiary corporation or a subsidiary cooperative association without the approval of the Commission.

SECTION 58-9-320. Transactions with affiliates.

When in the judgment of the commission there is a reasonably substantial affiliation of any telephone utility engaged in business in this State with any other corporation or person or when in the judgment of the commission any other corporation or person either exercises, or is in position to exercise, by reason of ownership or control of securities or for any other cause, any reasonably substantial control over the business or policies of any telephone utility engaged in business in this State, the burden of proof shall be upon the telephone utility to establish as determined by the commission the reasonableness, fairness, and absence of injurious effect upon the public interest of any fees or charges growing out of any transactions between any telephone utility and such other corporation or person. Every telephone utility shall be required to produce, if so ordered by the commission, for the information of the commission, the Office of Regulatory Staff, and the public, all such contracts, papers, and documents relating thereto and explanatory thereof as may be required by the commission, and unless the reasonableness, fairness, and absence of injurious effect upon the public interest of such fees and charges are established as determined by the commission, they shall not be allowed by the commission for rate-making purposes. The commission shall not allow for rate-making purposes any fees or expenses included in any contract or agreement with an affiliate representing charges that the commission has directly disallowed in its rate-making orders.

SECTION 58-9-330. Participation in profits from efficiency.

For the purpose of encouraging economy, efficiency and improvements in methods of service any telephone utility may participate, subject to the approval of the Commission, to such extent as may be permitted by the Commission, in the additional profits arising from any economy, efficiency or improvement in methods or service instituted by such telephone utility.

SECTION 58-9-340. System of accounts.

The Office of Regulatory Staff may, in its discretion, and subject to approval of the commission, prescribe systems of accounts to be kept by telephone utilities subject to the commission's jurisdiction and the Office of Regulatory Staff may prescribe the manner in which the accounts shall be kept and may require every telephone utility to keep its books, papers, and records accurately and faithfully according to the system of accounts as prescribed by the Office of Regulatory Staff. But nothing in this section shall be construed to be in conflict with or in violation of the provisions of the Communications Act of Congress of 1934, as amended (U. S. C. A. Title 47, Sections 151 through 609), nor shall anything herein be construed to be in conflict with any lawful order of the Federal Communications Commission issued pursuant to the authority vested in it by said act of Congress.

SECTION 58-9-350. Depreciation and retirement charges.

Every telephone utility shall have the right, and may be so required, to charge annually as an operating expense a reasonable sum for depreciation and credit it to a reserve account for such purpose. Such reserve account shall be charged with plant retirements. But if the reserve thus created shall at any time in the judgment of the Commission be excessive, the Commission after due hearing shall make such order as will result in credits to such reserve thereafter conforming to actual facts and conditions as ascertained by the Commission.

The Commission may control or limit such depreciation reserve.

Nothing in this section shall be construed to be in conflict with or in violation of the provisions of the Communications Act of Congress of 1934, as amended (U. S. C. A. Title 47, Sections 151 through 609), nor shall anything herein be construed to be in conflict with any lawful order of the Federal Communications Commission issued pursuant to the authority vested in it by said act of Congress.

SECTION 58-9-360. Restrictions on capitalization for rate-making purposes.

No telephone utility shall for rate-making purposes, capitalize its franchises, rights, powers or privileges or its right to own and operate or enjoy any such franchise, rights, powers or privileges in excess of the amount paid to the State or to any political subdivision of the State as the consideration for the grant thereof or capitalize any lease or contract of sale for consolidation or merger of two or more telephone utilities; nor shall the Commission permit any such capitalization by a telephone utility nor shall any telephone utility issue by way of substitution any capital stock, trust certificates, bonds, notes or other evidences of indebtedness or other securities for any consolidated or merged company exceeding the aggregate value of the properties so consolidated or merged and any additional sum of money actually contributed in cash and additional property or labor actually contributed. The determination of such consideration or value as aforesaid shall be subject to the approval of the Commission.

SECTION 58-9-370. Annual and special reports.

(A) Subject to approval of the commission, the Office of Regulatory Staff may require any telephone utility to file annual reports in such form and of such content as the Office of Regulatory Staff may require and special reports concerning any matter about which the Office of Regulatory Staff is authorized to inquire or to keep itself informed or which it is required to enforce. All reports shall be under oath when required by the Office of Regulatory Staff.

(B) A copy of all reports filed with the commission also must be provided to the Office of Regulatory Staff.

SECTION 58-9-380. Office in State.

Each telephone utility shall have an office in one of the counties of this State in which its property or some part thereof is located and shall keep in such office all such books, accounts, papers, and records as shall reasonably be required by the Office of Regulatory Staff to be kept within the State. No books, accounts, papers, or records required by the Office of Regulatory Staff to be kept within the State shall be removed at any time from the State except upon such conditions as may be prescribed by the Office of Regulatory Staff.

SECTION 58-9-390. Compliance with rules and regulations.

Each telephone utility shall obey and comply with each and every requirement of every order, decision, direction, rule, or regulation made or prescribed by the commission and every direction, rule, or regulation made or prescribed by the Office of Regulatory Staff in the performance of its duties under Articles 1 through 13 of this chapter, or in relation to any other matter in any way relating to or affecting the business of such telephone utility and shall do everything necessary or proper in order to secure compliance with and observance of every such order, decision, direction, rule, or regulation by all of its officers, agents, and employees.

ARTICLE 5.

TELEPHONE COMPANIES - CHANGES IN RATES

SECTION 58-9-510. Changes in phone rates.

Whenever the commission after a hearing finds that the existing rates in effect and collected by any telephone utility for any service are unjust, unreasonable, insufficient, unreasonably discriminatory, or in any way in violation of any provision of law, the commission shall determine the just, reasonable, and sufficient rates to be thereafter observed and in force and shall fix them by its order.

SECTION 58-9-520. Change in telephone rates initiated by utility; notice.

Whenever a telephone utility desires to put into operation a new rate or tariff which affects the telephone utility's general body of subscribers, the telephone utility shall give the commission and the Office of Regulatory Staff not less than thirty days' notice of its intention to file and shall, after the expiration of the notice period, then file with the commission and provide to the Office of Regulatory Staff a schedule setting forth the proposed changes; provided, however, a hearing shall not be required when the proposed rate or tariff is a proposal to institute or modify an offering or regulation that is not part of a general rate case and does not affect the telephone utility's general body of subscribers. Subject to the provisions of subsections (B) and (C) of Section 58-9-540, the proposed changes must not be put into effect in full or in part until approved by the commission.

SECTION 58-9-530. Dispensing with thirty days' notice of rate change.

The Commission, for good cause shown, may allow changes in rates without requiring the thirty days' notice under such conditions as it may prescribe, except that when changes in general schedules of rates and charges are involved, before they may become effective, notice to the public of such proposed changes shall be given by publication thereof once a week for two consecutive weeks in newspapers of general circulation in the territory involved and a hearing held thereon. All such changes shall be immediately indicated upon its schedules by such telephone utility.

SECTION 58-9-540. Hearing on new schedule of rates; time for Commission action.

(A) Whenever there is filed with the commission by any telephone utility a schedule stating a new rate or rates which affect the telephone utility's general body of subscribers, the commission shall, after notice to the Office of Regulatory Staff and the public such as the commission may prescribe, hold a hearing concerning the lawfulness or reasonableness of the rate or rates; provided, however, that when the proposed rate or tariff is a proposal to institute or modify an offering or regulation that is not part of a general rate case and does not affect the telephone utility's general body of subscribers, the commission may approve such filing without a hearing. Whenever a new rate is requested which affects the telephone utility's general body of subscribers, the commission shall rule and issue its order approving or disapproving the changes in full or in part within six months of the time of filing.

(B) Should the Commission determine that it cannot, due to circumstances reasonably beyond its control, issue such order within the six-month period prescribed by this section, the Commission, may, by order, extend the six-month period for an additional five days. Any such order shall set forth such circumstances and make appropriate findings concerning the need for the extended period.

If the Commission rules and issues its order within the time aforesaid, and the utility shall appeal from the order, by filing with the Commission a petition for rehearing, the utility may put the rates requested in its schedule into effect under bond only during the appeal and until final disposition of the case. Such bond must be in a reasonable amount approved by the Commission, with sureties approved by the Commission, conditioned upon the refund, in a manner to be prescribed by order of the Commission, to the persons, corporations, or municipalities respectively entitled to the amount of the excess, if the rate or rates put into effect are finally determined to be excessive; or there may be substituted for the bond other arrangements satisfactory to the Commission for the protection of parties interested. During any period in which a utility shall charge increased rates under bond, it shall provide records or other evidence of payments made by its subscribers or patrons under the rate or rates which the utility has put into operation in excess of the rate or rates in effect immediately prior to the filing of the schedule.

All increases in rates put into effect under the provisions of this section which are not approved and for which a refund is required shall bear interest at a rate of twelve percent per annum. The interest shall commence on the date the disallowed increase is paid and continue until the date the refund is made.

In all cases in which a refund is due, the Commission shall order a total refund of the difference between the amount collected under bond and the amount finally approved.

(C) If the Commission fails to rule or issue its order within the time prescribed in subsection (A) or (B) of this section, the utility may put into effect the change in rates it requested in its schedule. The change is to be treated as an approval of the new rate schedule by the Commission.

(D) After the date the schedule, which affects the telephone utility's general body of subscribers, is filed with the Commission, no further rate change request which affects the telephone utility's general body of subscribers may be filed until twelve months have elapsed from the date of the filing of the schedule; provided, however, this section shall not apply to a request for rate reduction.

(E) The commission's determination of a fair rate of return must be documented fully in its findings of fact and based exclusively on reliable, probative, and substantial evidence on the whole record.

SECTION 58-9-550. Repealed by 1983 Act No. 138, eff June 15, 1983.

SECTION 58-9-560. Repealed by 1983 Act No. 138, Section 21, eff June 15, 1983.

SECTION 58-9-570. Factors which Commission shall consider in determining rates.

In determining just, reasonable and sufficient rates the Commission shall give due consideration to the telephone utility's property devoted to the public service; the revenues received for the service; the reasonable operating expenses and other costs necessary to provide the service; the total earnings required for the proper discharge of the telephone utility's public duty; the capitalization of the telephone utility and the net income required on its net worth; and such other matters, circumstances and conditions as the Commission may find necessary. But the rates so fixed shall not be higher than necessary to give a fair return to the stockholders.

SECTION 58-9-575. Alternative means of regulating telephone utilities.

(A) Notwithstanding the provisions of Section 58-9-570, in fixing rates and charges for a local exchange telephone utility, the commission may, upon the request of the telephone utility or upon motion of the Office of Regulatory Staff, consider in lieu of the procedures provided in this chapter, alternative means of regulating the telephone utility. If the commission determines that a local exchange telephone utility is subject to competition with respect to its services, the commission may implement regulatory alternatives including, but not limited to, equitable sharing of earnings between a local exchange telephone utility and its customers, consistent with the provisions of Section 58-9-330.

(B) The commission shall review and may authorize implementation of an alternative regulatory plan under subsection (A) if it finds after notice and hearing that the substantial evidence of record shows that the plan:

(1) is consistent with the public interest;

(2) does not jeopardize the availability of reasonably affordable and reliable telecommunications services;

(3) provides clearly identifiable benefits to consumers that are not otherwise available under existing regulatory procedures;

(4) will reduce regulatory delay and costs;

(5) provides adequate safeguards to consumers of telecommunications services, including other telecommunications companies, when such services are not readily available from alternative suppliers in the relevant geographic market;

(6) includes effective safeguards to assure that rates for noncompetitive services do not subsidize the prices charged for competitive services. In determining whether a service is competitive, the commission shall consider, at a minimum, the availability, market share, and price of comparable service alternatives;

(7) assures that rates for noncompetitive services are just, reasonable, or not unduly discriminatory and provide a contribution to basic local telephone service; and

(8) does not jeopardize the ability of the telephone utility to provide quality, affordable telecommunications service.

(C) The commission may, on the motion of the Office of Regulatory Staff or any interested party, review any decision adopting an alternative method of regulation for a local exchange telephone utility. After notice and opportunity to be heard and upon a showing by substantial evidence, the commission may impose regulatory standards consistent with the provisions of this chapter.

SECTION 58-9-576. Election by LEC (local exchange carrier); alternative forms of regulation; duties of LEC.

(A) Any LEC may elect to have rates, terms, and conditions determined pursuant to the plan described in subsection (B), if the commission:

(1) has approved a local interconnection agreement in which the LEC is a participant with an entity determined by the commission not to be affiliated with the LEC;

(2) determines that another provider's service competes with the LEC's basic local exchange telephone service; or

(3) determines that at least two wireless providers have coverage generally available in the LEC's service area and that the providers are not affiliates of the LEC. A determination by the commission under subitem (3) of this subsection shall not constitute a determination under Section 58-9-280(E)(3) or (G)(1), or any other applicable provision of law, that a wireless provider is providing services that compete with a local telecommunications service in this State for purposes of participation in the state Universal Service Fund.

(B) Notwithstanding any other provision of this chapter, effective July 1, 1996, any LEC may elect to have its rates, terms, and conditions for its services determined pursuant to the plan described in this subsection, in lieu of other forms of regulation including, but not limited to, rate of return or rate base monitoring or regulation, upon the filing of notice with the commission and providing a copy of any such notice to the Office of Regulatory Staff as follows:

(1) If the provisions of subsection (A) have been complied with, the plan under this subsection becomes effective on the date specified by the electing LEC, but in no event sooner than thirty days after the notice is filed with the commission.

(2) Except as provided in item (8), on the date a LEC notifies the commission of its intent to elect the plan described in this section, existing rates, terms, and conditions for the services provided by the electing LEC contained in the then-existing tariffs and contracts are considered just and reasonable.

(3) The rates for flat-rated local exchange services for residential and single-line business customers on the date of election shall be the maximum rates that the LEC may charge for these local exchange services for a period of two years from the date the election is filed with the commission. During this period, the local exchange company may charge less than the authorized maximum rates for these services. For those small LEC's whose prices are below the statewide average local service rate, weighted by number of access lines, the commission shall waive the requirements of this paragraph until the time as the flat-rated local exchange service rate for residential customers equals the statewide average local residential service rate, weighted by the number of access lines, and the flat-rated local exchange service rate for single-line business customers equals two times the statewide average local residential service rate.

(4) For those companies to which item (3) applies, after the expiration of the period set forth above, the rates for flat-rate local exchange residential and single-line business service provided by a LEC may be adjusted on an annual basis pursuant to an inflation-based index.

(5) The LEC's shall set rates for all other services on a basis that does not unreasonably discriminate between similarly situated customers. All of these rates are subject to a complaint process for abuse of market position. The commission shall resolve any complaint alleging abuse of market position within one hundred eighty days of the date the complaint is filed with the commission. Rates that exceed the total service long run incremental cost of an offering or that satisfy Section 58-9-280(I) do not constitute an "abuse of market position". Other rates constitute an "abuse of market position" if they constitute any anticompetitive pricing action that prohibits a new firm from entering a market or that would cause a firm to exit a market. Additionally, during any given twelve-month period, the aggregate increases in the tariffed rates for other services must not exceed five percent of the aggregate revenues from tariffed other services during the prior twelve-month period.

(6) A LEC subject to this section shall file tariffs in accordance with Section 58-3-140(F) for its local exchange services that set out the terms and conditions of the services and the rates for these services. The LEC also must provide a copy of the tariffs to the regulatory staff. The tariff shall be presumed valid and become effective seven days after filing for price decreases and fourteen days after filing for price increases and new services.

(7) Any incumbent LEC operating under an alternative regulatory plan approved by the commission before the effective date of this section must adhere to the plan until the plan expires or is terminated by the commission, whichever is sooner.

(8) On the date a LEC notifies the commission of its intent to elect the plan described in this section under the criteria es