A. It is the policy of the California
Public Utilities Commission (Commission) that competition in the
provision of local exchange telecommunications services is in
the public interest.
B. It is the policy of the Commission
that, in an environment of competition for local exchange telecommunications
services, telecommunications users shall receive ongoing disclosure
of the rates, terms and conditions of service from telecommunications
providers and shall benefit from a clear and comprehensive set
of consumer protection rules.
C. It is the policy of the Commission
that interconnection of the networks of Competitive Local Carriers
(CLCs) and Local Exchange Carriers (LECs) should be accomplished
in a technically and economically efficient manner.
D. It is the policy of the Commission
that all telecommunications providers shall be subject to appropriate
regulation designed to safeguard against anti-competitive conduct.
E. It is the policy of the Commission
that service provider local number portability should be accomplished.
F. It is the policy of the Commission
that networks of dominant providers of local exchange telecommunications
services should be unbundled in such a manner that a carrier is
provided access to essential facilities on a nondiscriminatory
stand alone basis.
G. It is the policy of the Commission that customer privacy rights and concerns be protected in an environment of local exchange competition.
H. It is the policy of the Commission
to ensure that local exchange competition does not degrade the
reliability of the telecommunications network.
I. It is the policy of the Commission
to encourage intercarrier coordination and cooperation.
J. It is the policy of the Commission
to monitor, on a periodic basis, the market conditions of the
local exchange telecommunications market and reevaluate its policies
on local exchange competition accordingly.
K. It is the policy of this Commission
that Commission-approved tariffs for call termination should reflect
costs.
2. SCOPE OF RULES
These interim rules apply to the provision of local exchange telecommunications services by CLCs, and where applicable, LECs.
Local exchange carrier (LEC) as used
in these rules refers to only Pacific Bell and GTE California,
until further action by the Commission.
3. DEFINITIONS
A. Competitive local carrier (CLC) means
a common carrier that is issued a Certificate of Public Convenience
and Necessity after the effective date of this order, to provide
local exchange telecommunications service for a geographic area
specified by such carrier.
B. Local exchange carrier (LEC) means
any incumbent carrier listed in Appendix C attached hereto.
C. Minor rate increases are those which
are both less than 1% of the CLC's total California intrastate
revenues and less than 5% of the affected service's rates. Increases
shall be cumulative, such that if the sum of the proposed rate
increase and rate increases that took effect during the preceding
12-month period for any service exceeds either parameter above,
then the filing shall be treated as a major increase.
D. Major rate increases are increases
which are greater than the increases described above.
E. Network component means a functional capability of a network, disaggregated from other network capabilities and made available to other carriers and end users separately from all other network capabilities.
F. Nondominant interexchange carrier
(NDIEC) means an interexchange carrier that is considered nondominant
under the Commission's decisions.
G. NXX Rating Point means the end office/wire
center location designated in the Local Exchange Routing Guide
as the assignment point for an NPANXX code.
H. NXX Service Area means the geographicallybounded
area designated as the area within which a LEC or CLC may provide
local exchange telecommunication services bearing a particular
NPANXX designation.
I. Local telephone number portability
means the ability of end users to retain their existing telephone
numbers when remaining at a location, or changing their location
within the geographic area served by the initial carrier's serving
central office, regardless of the LEC or CLC selected.
J. Local exchange loop facility (also
known as a basic level network access channel) means a transmission
path capable of delivering analog voice grade signals or digital
signals at less than 1.544 Mbps between the network interface
at a customer's premises and the main distribution frame or any
other point of interconnection to the LEC network.
K. A port (also known as a basic level
network access channel connection) is the interface between the
loop and the appropriate LEC Central Office switching equipment.
L. Nonfacilities-based CLCs are those
which do not directly own, control, operate, or manage conduits,
ducts, poles, wires, cables, instruments, switches, appurtenances,
or appliances in connection with or to facilitate communications
within the local exchange portion of the public switched network.
M. Facilities-based CLCs are those which
directly own, control, operate, or manage conduits, ducts, poles,
wires, cables, instruments, switches, appurtenances, or appliances
in connection with or to facilitate communications within the
local exchange portion of the public switched network.
N. Service territory means the area in
which a CLC is authorized to provide service.
4. ENTRY, CERTIFICATION,
AND REGULATION OF CLCs
A. The Commission shall grant a Certificate
of Public Convenience and Necessity (CPCN) to any applicant that
possesses the requisite managerial qualifications, financial resources,
and technical competence to provide local exchange telecommunications
services.
B. The Commission shall apply the following
financial standards to the certification of CLCs:
(1) All new applicants seeking CPCNs
for authority to become facilities-based CLCs, as defined in this
decision, shall demonstrate in their applications that they possess
a minimum of $100,000 of cash or cash equivalent as defined below,
reasonably liquid and readily available to meet the firm's startup
expenses. Such applicants shall also document any deposits required
by local exchange companies or interexchange carriers (IECs) and
demonstrate that they have additional resources to cover all such
deposits.
(2) All new applicants seeking CPCNs
for authority to become nonfacilities-based CLCs, as defined in
these rules, shall demonstrate in their applications that they
possess a minimum of $25,000 of cash or cash equivalent as defined
below, reasonably liquid and readily available to meet the new
firm's expenses. Such applicants shall also document any deposits
required by LECs or IECs and demonstrate that they have additional
resources to cover all such deposits.
(3) Applicants for CPCNs as CLCs who
have profitable interstate operations may meet the minimum financial
requirement by submitting an audited balance sheet and income
statement demonstrating sufficient cash flow, as authorized in
Decision (D.) 91-10-041 for NDIECs.
(4) New applicants for CPCNs as CLCs
shall be permitted to use any of the following financial instruments
to satisfy the applicable unencumbered cash requirements established
by this order.
(a) Cash or cash equivalent, including
cashier's check, sight draft, performance bond proceeds, or traveler's
checks;
(b) Certificate of deposit or other liquid
deposit, with a reputable bank or other financial institution;
(c) Preferred stock proceeds or other
corporate shareholder equity, provided that use is restricted
to maintenance of working capital for a period of at least twelve
(12) months beyond certification of the applicant by the Commission;
(d) Letter of credit, issued by a reputable
bank or other financial institution, irrevocable for a period
of at least twelve (12) months beyond certification of the
applicant by the Commission;
(e) Line of credit or other loan, issued
by a reputable bank or other financial institution, irrevocable
for a period of at least twelve (12) months beyond certification
of the applicant by the Commission, and payable on an interestonly
basis for the same period;
(f) Loan, issued by a qualified subsidiary,
affiliate of applicant, or a qualified corporation holding controlling
interest in the applicant, irrevocable for a period of at least
twelve (12) months beyond certification of the applicant by the
Commission, and payable on an interestonly basis for the
same period;
(g) Guarantee, issued by a corporation,
copartnership, or other person or association, irrevocable for
a period of at least twelve (12) months beyond certification of
the applicant by the Commission;
(h) Guarantee, issued by a qualified
subsidiary, affiliate of applicant, or a qualified corporation
holding controlling interest in the applicant, irrevocable for
a period of at least twelve (12) months beyond the certification
of the applicant by the Commission.
(5) The definitions of certain of the
financial instruments listed in 4.B (4) and our intent on nondiscriminatory
application of these definitions are clarified as follows:
(a) All unencumbered instruments listed
in 4.a. through 4.h. above will be subject to verification and
review by the Commission prior to and for a period of twelve (12)
months beyond certification of the applicant by the Commission.
Failure to comply with this requirement will void applicant's
certification or result in such other action as the Commission
deems in the public interest, including assessment of reasonable
penalties. (See PU Code '' 581
and 2112.)
(b) Applicants for CPCNs as nonfacilities-based
CLCs shall assure that every issuer of a letter of credit, line
of credit, or guarantee to applicant will remain prepared to furnish
such reports to applicant for tendering to the Commission at such
time and in such form as the Commission may reasonably require
to verify or confirm the financial responsibility of applicant
for a period of at least twelve (12) months after certification
of the applicant by the Commission.
(c) All information furnished to the
Commission for purposes of compliance with this requirement will
be available for public inspection or made public, except in cases
where a showing is made of a compelling need to protect it as
private or proprietary information.
C. The Commission shall apply the following
other standards to its regulation of CLCs:
(1) Applicants which currently hold CPCNs
as telecommunications providers should apply as prescribed herein
to have their current authority expanded to include operating
as a CLC.
(2) Applicants will be required to comply
with CEQA as specified in Rule 17.1 of the Commission=s
Rules of Practice and Procedure
(3) If a CLC is 90 or more days late
in filing the annual report required by General Order (GO) 104-A
or in remitting any current or future Commission-mandated surcharge,
including but not limited to Universal Lifeline Telephone Service
Fund (Public Utilities (PU) Code S 879), DEAF Trust Fund (PU Code
S. 2881(d), the California High Cost Fund (PU Code S 739.3), or
the user fees on intrastate revenues (PU Code SS 431-435), the
Commission Advisory and Compliance Division (CACD) shall prepare
a resolution for the Commission's consideration revoking the CLC's
CPCN, unless the CLC has received written permission from the
CACD to file or remit late.
D. The CACD shall on or before January
1, 1997 and at least one time each year thereafter, prepare a
list of all current CLCs in good standing operating in California,
including addresses, phone numbers, and the name of the responsible
contact person at each such utility, and then disseminate that
list to all other telecommunications utilities including the local
exchange companies and IECs and will provide the list at the Commission's
standard per page charge to any other interested party having
requested such list.
E. CLCs shall be subject to the following
tariff and contract filing, revision and service pricing standards:
(1) Uniform rate reductions for existing
tariff services shall become effective on five (5) working days'
notice to the Commission. Customer notification is not required
for rate decreases.
(2) Uniform major rate increases for
existing tariff services shall become effective on thirty (30)
days*
notice to the Commission, and shall require bill inserts, or a
message on the bill itself, or first class mail notice to customers
at least 30 days in advance of the pending rate increase.
(3) Uniform minor rate increases shall
become effective on not less than five (5) working days' notice
to the Commission. Customer notification is not required for such
minor rate increases.
(4) Advice letter filings for new services
and for all other types of tariff revisions, except changes in
text not affecting rates or relocations of text in the tariff
schedules, shall become effective on forty (40) days' notice to
the Commission.
(5) Advice letter filings revising the
text or location of text material which do not result in an increase
in any rate or charge shall become effective on not less than
five (5) days' notice to the Commission.
(6) Contracts shall be subject to GO
96-A rules for NDIECs.
(7) CLCs shall file tariffs in accordance
with PU Code Section 876.
F. The following regulations shall apply
to CLCs:
(1) CLCs shall be required to serve customers
requesting service within their designated service territory on
a non-discriminatory basis, but shall not be required to have
the same service territory as LEC service territories;
(2) Facilities-based CLCs shall at a
minimum serve all customers who request service and whose premises
are within 300 feet of the CLC's transmission facilities used
to provide service so long as the CLC can reasonably obtain access
to the point of demarcation on the customer's premises, but the
CLC shall not be required to build out facilities beyond such
300 feet.
(3) CLCs shall file service territory
maps with the Commission that detail the area in which the CLC
is authorized to provide service.
(4) CLCs shall file quarterly a written
description or a map that describes its existing physical facilities.
(5) For any interexchange carrier which
subscribes to a CLC's switched access services, the CLC is required
to provide 1+ presubscription or 10XXX equal access consistent
with the equal access rules of this Commission and of the Federal
Communications Commission.
(6) Facilities-based CLCs are required
to make all telecommunications service offerings available for
resale, only within the same class of service, on a nondiscriminatory
basis.
(7) CLCs shall be subject to the obligations
of public utilities under the Public Utilities Code, including
but not limited to, sections 451 and 453, dealing with the provision
of just and reasonable rates and charges;
(8) CLCs must obtain Commission approval
before discontinuing service in any part of their service area.
(9) CLCs shall provide 911 and/or E911
service.
(10) To ensure that qualified customers are provided with TDDs or other telecommunications equipment under the DEAF program, a workshop shall be held with LECs, CLCs and other interested parties to determine how the DEAF program should be administered; how to coordinate operator, directory assistance and long distance access services for deaf and disabled customers; and how to accurately track, monitor and report equipment provided to deaf and disabled customers in an environment with more than one provider of local exchange service. Until such time as the Commission has time to act on the workshop report, the CLC shall work with the LEC to ensure that qualified customers are provided with TDDs or other telecommunications equipment under the DEAF program.
(11) LECs and CLCs shall develop a program
to address the issues regarding access to repair service, i.e.,
611, to ensure its integration in the environment of local exchange
competition.
(12) CLCs shall be subject to the consumer
protection rules contained in Appendix B.
(13) CLCs shall provide the following
reports to the Commission:
(a) On a quarterly basis, a copy of all
written notices provided to customers, in accordance with Rules
1, 2 and 6 of the consumer protection rules set forth in Appendix
B;
(b) By April 1 of each year a copy of
the CLC's annual report;
(c) On a monthly basis, reports regarding
major service outages;
(d) Reports required in GO 133-B and
GO 152-A; and
(e) Such other reports required by the
Commission.
(14) CLCs shall submit all mandated bill
insert notices, including notices of basic universal service rate
increases, to the Commission's Public Advisor's Office for review
and approval, and shall allow the Public Advisor's Office at least
five working days to review and approve the proposed bill inserts
prior to their issuance to customers.
5. REGULATION OF LECs
A. Incumbent LECs shall have provider
of last resort responsibilities in their service areas until the
Commission makes a decision on the issue in its Universal Service
docket.
6. INTERIM NUMBER PORTABILITY
A. In the interim, local number portability
shall be provided by Remote Call Forwarding, Direct Inward Dialing
(DID), or other equivalent means. CLCs are required to arrange
for transport facilities to the central office where portability
is sought. CLCs shall reciprocate by offering portability to the
LECs.
B. CLCs will be able to purchase remote
call forwarding from the LECs at a price equal to Direct Embedded
Cost (DEC). The LECs should establish a Memorandum Account to
record the difference between the current tariff rate and the
rate to be charged to CLCs. The Commission will review the balance
in the Memorandum Account and determine what adjustments are to
be made in the amounts and if any is to be recovered. the LECs
should recover the balance in the account.
7. INTERCONNECTION
OF LEC AND CLC NETWORKS FOR TERMINATION OF LOCAL RAFFIC
A. The interconnection of LEC and CLC
networks for the termination of local traffic involves not only
the construction and maintenance of the interconnecting facilities,
but also the throughput of local terminating traffic across those
interconnecting facilities. Local exchange networks shall be interconnected
so that customers of any local exchange carrier can seamlessly
receive calls that originate on another local exchange carrier's
network and place calls that terminate on another local exchange
carrier's network without dialing extra digits. In accordance
with PU Code 767, parties are encouraged to negotiate interconnection
arrangements until mandatory interconnection rules are established.
Any interim agreements reached will not be invalidated by these
rules.
B. Virtual or physical collocation interconnection
arrangements are not precluded, and may be implemented by mutual
agreement, but shall not be a mandatory form of LEC-CLC interconnection.
C. Local traffic shall be terminated
by LECs for CLCs and by CLCs for the LECs over the interconnecting
facilities described in this Section.
D. In the interim, local traffic shall
be terminated by the LEC for the CLC and by the CLC for the LEC
over the interconnecting facilities described in this Section
on the basis of mutual traffic exchange. Mutual traffic exchange
means the exchange of terminating local traffic between or among
CLCs and LECs, whereby LECs and CLCs terminate local exchange
traffic originating from end users served by the networks of other
LECs or CLCs without explicit charging among or between said carriers
for such traffic exchange.
E. Within 12 months of the date of this
order, the Commission will review the appropriateness of a bill
and keep system, and modify if necessary.
(END OF APPENDIX A)