Electronic Tariff Filing System (ETFS), 43206-43217 [2011-17778]

Agencies

• FEDERAL COMMUNICATIONS COMMISSION

[Federal Register Volume 76, Number 139 (Wednesday, July 20, 2011)]
[Rules and Regulations]
[Pages 43206-43217]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2011-17778]


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FEDERAL COMMUNICATIONS COMMISSION

47 CFR Parts 61 and 64

[WC Docket No. 10-141; FCC 11-92]


Electronic Tariff Filing System (ETFS)

AGENCY: Federal Communications Commission.

ACTION: Final rule.

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SUMMARY: In this document, the Federal Communications Commission 
(Commission) adopts rule revisions enabling all tariff filers to file 
tariffs electronically over the Internet, using the Electronic Tariff 
Filing System (ETFS). Additionally, the Commission clarifies and makes 
more consistent certain technical rules related to tariff filings. The 
Commission concludes that it is appropriate to apply the same 
electronic filing requirements to all tariff filers and expands the 
applicability of the Commission's rules to include all tariff filers. 
The Commission also concludes that the Commission's rules, which 
require specific formatting and composition of tariffs, will now apply 
to all tariff filers. The Chief of the Wireline Competition Bureau will 
be responsible for administering the adoption of electronic tariff 
filing requirements for all tariff filers.

DATES: This rule contains information collection requirements that have 
not been approved by Office of Management and Budget. The Commission 
will publish a document in the Federal Register announcing the 
effective date for the revised rules. Tariff filers will then have a 
60-day window in which to file their first electronic tariff.

FOR FURTHER INFORMATION CONTACT: Pamela Arluk, Wireline Competition 
Bureau, Pricing Policy Division, 202-418-1520. For additional 
information concerning the Paperwork Reduction Act information 
collection requirements contained in this document, send an e-mail to 
PRA@fcc.gov or contact Judith B. Herman at 202-418-0214.

SUPPLEMENTARY INFORMATION: This is a synopsis of the Commission's 
Report and Order (Order), FCC 11-92, adopted and released on June 9, 
2011. The full text of the Order is available for inspection and 
copying during regular business hours in the FCC Reference Center, 445 
Twelfth Street, SW., Room CY-A257, Portals II, Washington, DC 20554, 
and may also be purchased from the Commission's copy contractor, BCPI, 
Inc., Portals II, 445 Twelfth Street, SW., Room CY-B402, Washington, DC 
20554. Customers may contact BCPI, Inc. via their Web site, https://www.bcpi.com, or call 1-800-378-3160. This document is available in 
alternative formats (computer diskette, large print, audio record, and 
Braille). Persons with disabilities who need documents in these formats 
may contact the FCC by e-mail: FCC504@fcc.gov or phone: 202-418-0530 or 
TTY: 202-418-0432.

Synopsis of Report and Order

    1. In the ETFS Notice of Proposed rulemaking (NPRM), the Commission 
provided a detailed description of the Commission's implementation of 
the statutory tariff streamlining requirements and the development and 
implementation of the ETFS. To summarize briefly, on September 6, 1996, 
the Commission released the Tariff Streamlining NPRM, 61 FR 49,987, 
September 24, 1996, proposing measures to implement the tariff 
streamlining requirements of section 204(a)(3) of the Communications 
Act of 1934, as amended (Act), including a proposal that would require 
LECs to file tariffs electronically. The Commission began implementing 
the electronic filing of tariffs on January 31, 1997, when it released 
the Streamlined Tariff Order. On May 28, 1998, the Common Carrier 
Bureau (Bureau) released the ETFS Order, 63 FR 35,539, June 30, 1998, 
in which it established July 1, 1998, as the date after which incumbent 
LECs would be required to use the ETFS to file tariffs and associated 
documents. Although the Tariff Streamlining NPRM proposed mandatory 
electronic filing by all local exchange carriers, the Bureau limited 
the scope of the ETFS Order to incumbent LECs.
    2. In 1996, the Commission ordered mandatory detariffing of most 
interstate, domestic interexchange services of nondominant 
interexchange carriers, but permitted some exceptions to the mandatory 
detariffing requirement. In addition, nondominant carriers continued to 
file tariffs for other services that were unaffected by the Detariffing 
Order. Competitive LECs are permitted to tariff interstate switched 
access charges if the charges are no higher than the rate charged for 
such services by the competing incumbent LEC except where the rural 
exemption applies. Competitive LECs are also permitted to tariff other 
interstate access services such as special access. In contrast to 
tariff filings by incumbent LECs, tariff filings by nondominant 
carriers are currently submitted on diskette, CD-ROM accompanied by a 
cover letter, and paper for informational tariffs, all of which are 
cumbersome and costly for the carrier and the Commission, and make it 
difficult for interested parties to review the documents due to 
internal distribution and storage barriers.
    3. On July 15, 2010, the Commission released the ETFS NPRM, 75 FR 
48,629, August 11, 2010, which proposed to modify the Commission's 
rules to require all tariff filers to file tariffs and other associated 
documents via the ETFS. The Commission requested comments on the 
benefits these rule modifications would produce. The Commission also 
requested comment on a number of technical rule modifications that 
would be necessary to implement the new electronic filing requirements. 
Four comments were received, all urging the Commission to quickly adopt 
the proposed rules.
    4. As shown below, electronic filing for all tariff filers will 
greatly benefit the public, carriers, and the Commission. Accordingly, 
we adopt rule modifications that require electronic tariff filing for 
all tariff filers. Specifically, we require all tariff filers to follow 
the Commission's rules for electronic tariff filing and file using the 
ETFS for their tariffs, tariff revisions, Base Documents, and 
associated documents, including applications for special permission, 
and petitions and replies to petitions against tariff filings.
    5. After review of the record, we conclude that electronic filing 
of all tariffs and associated documents will facilitate the 
administration of nondominant tariffs and therefore is in

[[Page 43207]]

the public interest. We also find that the same benefits realized from 
electronic tariff filing by incumbent LECs, as outlined in the Tariff 
Streamlining NPRM, will be realized by enabling electronic filing of 
tariffs and associated documents by nondominant carriers. These 
anticipated benefits include: reducing burdens on carriers and the 
Commission; facilitating access to tariffs and associated documents by 
the public; increasing the ease with which interested parties can 
review all tariffs; making all tariff information available to state 
and other federal regulators; and facilitating the compilation of 
aggregate carrier data for industry analysis purposes. In addition, 
electronic filing of tariffs should enable the Commission and 
interested parties to more efficiently identify tariffs that may be 
unlawful and/or in violation of Commission rules and precedent. We 
conclude that including all tariffs on the ETFS will improve public 
access to these filings and will greatly enhance the transparency and 
efficiency of the tariff filing process. For these reasons, we also 
require international dominant carriers filing pursuant to section 
61.28 of the Commission's rules to be subject to electronic filing.
    6. Filing Requirements. In the ETFS NPRM, we proposed that all 
tariff filers file electronically subject to Sec. Sec.  61.14, 61.15, 
and 61.16 of the Commission's rules. No comments were filed opposing 
this proposal. Accordingly, we conclude that it is appropriate to apply 
the same electronic filing requirements to all tariff filers and we 
expand the applicability of Sec. Sec.  61.14, 61.15, and 61.16 of the 
Commission's rules to include all tariff filers.
    7. We also adopt our proposals with regard to Sec.  61.15's FCC 
Registration Number (FRN) requirements. We require that, consistent 
with this rule, each letter of transmittal must contain the filing 
carrier's FRN. If more than one carrier participates in the tariff, the 
FRN for the filing carrier and the FRNs for each individual carrier 
that participates in the tariff must be included in the letter of 
transmittal. This will ensure that it is clear to Commission staff and 
the public which issuing, concurring, and other carriers are 
participating in a tariff. We also conclude that the use of consecutive 
transmittal numbers for letters of transmittal pursuant to the proposed 
revision of Sec.  61.15 facilitates the Commission's ability to 
electronically match the mandatory tariff filing fee with the 
appropriate carrier's filing.
    8. In the ETFS NPRM, we invited specific comment on the use of 
transmittal numbers if mandatory electronic filing is required. For 
carriers converting from non-electronic filing, we asked whether 
transmittal numbers should continue sequentially from the last non-
electronic tariff or associated document transmission or whether 
transmittal numbers should start anew at the number one. Similarly for 
special permission applications, we asked whether the first special 
permission application filed electronically for a carrier should start 
with number one or whether the special permission application should 
continue to be numbered sequentially from the last non-electronically 
filed special permission request.
    9. Commenters recommend that the existing sequential numbering be 
followed for both transmittal numbers and special permission 
applications. For example, Sprint argues that it would be confusing for 
the Commission and customers who review tariff filings to have the 
numbering restart at number one for the electronic filings because 
there would be duplicate transmittal and application numbers. We agree 
and clarify that for carriers converting from non-electronic filings, 
transmittal numbers must continue sequentially from the last non-
electronic filing, consistent with Sec.  61.15 of our rules. Special 
permission application numbers must also continue to be numbered 
sequentially from the last non-electronically filed application.
    10. Currently, Sec. Sec.  61.52 and 61.54 of our rules, which 
require specific formatting and composition of tariffs, apply only to 
dominant carriers. Because we will be requiring all carriers to file 
tariffs electronically, in the ETFS NPRM, we proposed that all carriers 
be required to comply with the formatting and composition requirements 
of our rules. This would ensure that all tariffs have a basic 
uniformity that will facilitate an ease of review for customers and 
other entities examining such tariffs. In its comments, Sprint argues 
that certain of the Sec.  61.54 requirements would be burdensome for 
nondominant carriers. For example, Sprint argues that nondominant 
carriers should not be required to comply with Sec.  61.54(b)(2), which 
requires the exact name of the carrier, a brief statement showing each 
class of service provided, the geographic application, and the type of 
facilities used to provide service be included in the tariff. Sprint 
also expresses concern about nondominant carriers having to comply with 
Sec.  61.54(c)(3)(ii), which requires the carrier to ``indicate the 
transmittal number under which that page was submitted.''
    11. We provide the following clarifications to address Sprint's 
concerns that the filing requirements, particularly the requirements of 
Sec.  61.54, would be overly burdensome for nondominant carriers. 
Section 61.54(b)(2) requires the following information: (1) The exact 
name of the carrier; (2) a brief statement showing each class of 
service provided; (3) the geographical application; and (4) the type of 
facilities used to provide service to be included in the tariff. We 
note that most incumbent LECs comply with this requirement by including 
a brief statement on the Title page of the tariff, and we would expect 
that nondominant carriers would comply in a similar manner. Thus, we 
conclude that this is not an overly burdensome requirement and is 
helpful to Commission staff and the public reviewing the tariff by 
including some descriptive information on the Title page of the tariff. 
Therefore, we require that nondominant tariffs comply with Sec.  
61.54(b)(2), as proposed in the ETFS NPRM. With regard to the Sec.  
61.54(c)(3)(ii) transmittal number requirement, we clarify that this 
will be applied to nondominant carriers filing revisions to their 
tariff, on a prospective basis, once their initial Base Document has 
been filed electronically. This information is helpful in tracing 
modifications made to tariffs, so we conclude that it must be applied 
to all tariff filers. However, we do not expect nondominant carriers to 
research their previously filed tariff revisions to include different 
transmittal numbers on the initial Base Document. In the future, if a 
page is modified, the carrier must include the transmittal number under 
which the revised page is being submitted.
    12. In the ETFS NPRM, we proposed amending the notice requirements 
of Sec.  61.58 of our rules to add a provision requiring nondominant 
carriers that are eligible to file pursuant to the streamlining 
requirements of section 204(a)(3) of the Act, but choose not to file 
using these statutory timeframes, to file tariffs on at least one day's 
notice. This addition to Sec.  61.58 would permit us to delete Sec.  
61.23 as duplicative, and instead require all carriers to comply with 
the general notice requirements of Sec.  61.58. No carriers filed 
comments objecting to this proposal. To streamline our rules, we adopt 
this proposal to require all carriers to comply with Sec.  61.58 of the 
Commission's rules and we delete Sec.  61.23 as duplicative.
    13. In the ETFS NPRM, we noted that a number of nondominant 
carriers operate under a ``doing business as'' or d/b/a name, and 
proposed to clarify that Sec.  61.54 of the Commission's rules requires 
carriers to use their legal names in tariffs and associated documents

[[Page 43208]]

when filing via the ETFS. If carriers use a d/b/a name in addition to 
their legal name, we proposed that the d/b/a name be noted on the Title 
page of the tariff in addition to the ``exact name of the carrier.'' No 
commenters objected, and we adopt this proposal to ensure that the 
legal name of the carrier is clear.
    14. Compliance Deadline. We note that ETFS has been available for 
use since November 17, 1997 and its use has been mandatory for 
incumbent LECs since July 1, 1998. Given that the ETFS has been used by 
the public for more than a decade, in the ETFS NPRM, we sought comment 
on the amount of time parties believe all tariff filers will need 
before they can comply with the mandatory tariff filing requirement. 
Specifically, we proposed that all tariff filers must use the ETFS for 
all tariff and associated document filing 120 days after a final order 
in this docket implementing such a requirement (or summary thereof) is 
published in the Federal Register. We also proposed that affected 
carriers must file their currently effective tariffs on the ETFS no 
later than 120 days after the revised rules become effective, which 
will be the carrier's initial Base Document.
    15. Commenters generally supported this time period. For example, 
Sprint stated that 120 days should be sufficient for carriers to modify 
and file their tariffs. Qwest also noted that the time period was 
reasonable. We reject AT&T's proposal that the time period for filing 
electronic tariffs should be shortened to 30 days after the Commission 
has upgraded the ETFS to accept competitive LEC filings. We want to 
ensure that nondominant carriers have sufficient time to prepare for 
the change and Commission staff has sufficient time to respond to 
nondominant carrier inquiries. Accordingly, we adopt our proposal to 
provide a 120-day transition period, but to ensure that the ETFS will 
be able to process all of the new tariff filings, we also provide a 
window to allow carriers time to file their tariffs using the ETFS. We, 
therefore, conclude that the revised rules will become effective 120 
days after this order is published in the Federal Register. Once the 
rules are effective, we require all tariff filers to use ETFS to file 
their currently effective tariffs within 60 days after the revised 
rules become effective. This filing will be the carrier's initial Base 
Document. The two-stage process will provide nondominant carriers with 
sufficient notice to prepare for electronic filing, and will allow 
greater flexibility as to the timing of the filings and help ensure 
that the ETFS can handle all of the new incoming filings. Therefore, 
once the revised rules become effective, nondominant tariff filers may 
file their initial Base Document any time within the 60-day period.
    16. We encourage tariff filers to plan appropriately and not wait 
until the last day of the 60-day period, to ensure that the ETFS will 
be able to accept their filing. Once the initial Base Documents are 
filed on the ETFS, all future tariff revisions also are required to be 
filed electronically on the ETFS. To ensure that carriers will not 
continue to rely on manually filed tariffs, all tariffs previously 
filed with the Commission not using ETFS will be cancelled pursuant to 
Sec.  61.87 of the Commission's rules. Cancellation will be effective 
on filing of the initial Base Document replacing the tariff or at the 
end of the 60-day filing window if no initial Base Document has been 
filed in ETFS. Because Sec.  61.87 requires carriers, once they cancel 
a tariff, to revise the Title page to indicate the tariff is no longer 
effective, for the purpose of this initial Base Document filing only, 
we waive, on our own motion, the requirements to file new Title pages 
when a carrier cancels a tariff pursuant to Sec.  61.87 of the 
Commission's rules. After the rules become effective, tariff filers 
will no longer be permitted to file diskette, CD-ROM and/or paper 
copies of tariffs and associated documents that otherwise would be 
filed with the Secretary, the Chief of the Pricing Policy Division of 
the Wireline Competition Bureau, and the Commission's commercial 
contractor.
    17. For consistency and administrative clarity, we proposed changes 
to additional sections in Part 61 of the Commission's rules as shown in 
Appendix A of the ETFS NPRM. For example, we proposed consolidating the 
requirements for letters of transmittal and cover letters in Sec.  
61.15 of the Commission's rules, and therefore, proposed to delete 
Sec. Sec.  61.21 and 61.33 of our rules because those rules would be 
duplicative of Sec.  61.15. Commenters did not object to these 
proposals, and we adopt the rule revisions in Appendix A.
    18. Administration. As we proposed in the ETFS NPRM and consistent 
with the Streamlined Tariff Order, we conclude that the Chief of the 
Wireline Competition Bureau will be responsible for administering the 
adoption of electronic tariff filing requirements for all tariff 
filers.

Final Regulatory Flexibility Analysis

    19. An initial Regulatory Flexibility Analysis (IRFA) was 
incorporated in the ETFS NPRM. The Commission sought written public 
comment on the proposals in the ETFS NPRM, including comment on the 
IRFA. No comments were received. This present Final Regulatory 
Flexibility Analysis (FRFA) conforms to the RFA.

 A. Need for, and Objectives of, the Proposed Rules

    20. Today, the Commission adopts a Report and Order to extend the 
requirement to file tariffs and associated documents electronically via 
the Electronic Tariff Filing System (ETFS) to all tariff filing 
entities. The Commission concludes that requiring the electronic filing 
of all tariffs and associated documents would benefit the public. The 
Commission concludes that the proposed rules will become effective, and 
therefore, the ETFS will be available for all tariff filers to use 120 
days after a final order in this docket implementing such a requirement 
(or summary thereof) is published in the Federal Register. After the 
final rules are effective, tariff filers will have a 60-day transition 
to begin using the ETFS system to file their tariffs and associated 
documents. The Commission also concluded that the Chief of the Wireline 
Competition Bureau would administer the adoption of this extended 
electronic filing requirement.

B. Summary of Significant Issues Raised by Public Comments in Response 
to the IRFA

    21. There were no comments raised that specifically addressed the 
rules and policies proposed in the IRFA.

C. Description and Estimate of the Number of Small Entities to Which 
the Proposed Rules May Apply

    22. The RFA directs agencies to provide a description of, and where 
feasible, an estimate of the number of small entities that may be 
affected by the proposed rules, if adopted. The RFA generally defines 
the term ``small entity'' as having the same meaning as the terms 
``small business,'' ``small organization,'' and ``small governmental 
jurisdiction.'' In addition, the term ``small business'' has the same 
meaning as the term ``small-business concern'' under the Small Business 
Act. A ``small-business concern'' is one which: (1) Is independently 
owned and operated; (2) is not dominant in its field of operation; and 
(3) satisfies any additional criteria established by the Small Business 
Administration.
    23. Total Number of Telephone Companies Affected. The United States 
Bureau of the Census (Census Bureau) reports that, at the end of 1992, 
there were 3,497 firms engaged in providing telephone services, as 
defined therein, for at least one year. This number

[[Page 43209]]

contains a variety of different categories of carriers, including local 
exchange carriers, interexchange carriers, competitive access 
providers, cellular carriers, mobile service carriers, operator service 
providers, pay telephone operators, covered specialized mobile radio 
providers, and resellers. It seems certain that some of these 3,497 
telephone service firms may not qualify as small entities or small 
incumbent LECs because they are not ``independently owned and 
operated.'' For example, a personal communications service (PCS) 
provider that is affiliated with an interexchange carrier having more 
than 1,500 employees would not meet the definition of a small business. 
It is reasonable to conclude that fewer than 3,497 telephone service 
firms are small entity telephone service firms or small incumbent LECs 
that may be affected by the proposed rules, herein adopted.
    24. Competitive Access Providers. Neither the Commission nor the 
SBA has developed a definition of small entities specifically 
applicable to competitive access services providers (CAPs). The closest 
applicable definition under the SBA rules is for telephone 
communications companies other than radiotelephone (wireless) 
companies. According to the most recent data, there are 349 CAPs and 
competitive LECs engaged in the provision of competitive local exchange 
services. We do not have data specifying the number of these carriers 
that are not independently owned and operated, or have more than 1,500 
employees, and thus are unable at this time to estimate with greater 
precision the number of CAPs that would qualify as small business 
concerns under the SBA's definition. Consequently, we estimate that 
there are less than 349 small entity CAPs providing competitive local 
exchange services that may be affected by the Report and Order.
    25. Interexchange Carriers. Neither the Commission nor the SBA has 
developed a size standard for small businesses specifically applicable 
to interexchange services (IXCs). The closest applicable definition 
under the SBA rules is for telephone communications companies other 
than radiotelephone (wireless) companies. According to the most recent 
data, there are 204 carriers engaged in the provision of interexchange 
services. We do not have data specifying the number of these carriers 
that are not independently owned and operated or have more than 1,500 
employees, and thus are unable at this time to estimate with greater 
precision the number of IXCs that would qualify as small business 
concerns under the SBA's definition. Consequently, we estimate that 
there are less than 204 small entity IXCs that may be affected by the 
Report and Order.
    26. Operator Service Providers (OSPs). Neither the Commission nor 
the SBA has developed a small business size standard specifically for 
operator service providers. The appropriate size standard under SBA 
rules is for the category Wired Telecommunications Carriers. Under that 
size standard, such a business is small if it has 1,500 or fewer 
employees. According to Commission data, 28 carriers have reported that 
they are engaged in the provision of operator services. Of these, an 
estimated 27 have 1,500 or fewer employees and one has more than 1,500 
employees. Consequently, the Commission estimates that the majority of 
OSPs are small entities.

D. Description of Projected Reporting, Recordkeeping and Other 
Compliance Requirements

    27. In this Report and Order, the Commission is expanding mandatory 
electronic filing to all tariff filers, which include competitive LECs. 
The Report and Order requires that all tariff filers must follow the 
Commission's rules for electronic tariff filing and file via ETFS their 
tariffs, tariff revisions, base documents and associated documents, 
including applications for special permission. Moreover, in order to 
provide uniformity for tariff filings, the Report and Order extends 
certain procedural requirements to all tariff filing entities, 
including: specific formatting and composition requirements, the use of 
FCC registration numbers and the use of transmittal numbers.

E. Steps Taken To Minimize Significant Economic Impact on Small 
Entities, and Significant Alternatives Considered

    28. The RFA requires an agency to describe any significant, 
specifically small business, alternatives that it has considered in 
reaching its proposed approach, which may include the following four 
alternatives (among others): ``(1) The establishment of differing 
compliance or reporting requirements or timetables that take into 
account the resources available to small entities; (2) the 
clarification, consolidation, or simplification of compliance and 
reporting requirements under the rules for such small entities; (3) the 
use of performance rather than design standards; and (4) an exemption 
from coverage of the rule, or any part thereof, for such small 
entities.''
    29. In the ETFS NPRM, we sought comment from all interested parties 
and no parties objected to the electronic filing proposals. The 
Commission believes that most carriers are familiar with the Electronic 
Tariff Filing System, if not currently using it. As such, the 
Commission believes the burden on small entities will be minimal. In 
addition, to assist tariff filers that have not used ETFS previously, 
including small entity filers, the Commission is allowing carriers a 
180-day transition period before they will be required to begin using 
ETFS.

F. Federal Rules That May Duplicate, Overlap, or Conflict With the 
Proposed Rules

    30. None.

Final Paperwork Reduction Act of 1995 Analysis

    31. This order contains new or modified information collection 
requirements subject to the Paperwork Reduction Act of 1995 (PRA), 
Public Law 104-13. It has been submitted to the Office of Management 
and Budget (OMB) for review under Section 3507(d) of the PRA. OMB, the 
general public, and other Federal agencies are invited to comment on 
the new or modified information collection requirements contained in 
this proceeding. In addition, we note that pursuant to the Small 
Business Paperwork Relief Act of 2002, Public Law 107-198, see 44 
U.S.C. 3506(c)(4), we previously sought specific comment on how the 
Commission might further reduce the information collection burden for 
small business concerns with fewer than 25 employees.
    32. In this order, we have assessed the effects of electronic 
filing on small entities and believe the burden will be minimal. In 
addition, to assist tariff filers that have not used the ETFS 
previously, including small entity filers, the Commission is allowing 
carriers a 180-day transition period to begin using the ETFS.

Congressional Review Act

    33. The Commission will send a copy of this Report and Order in a 
report to be sent to Congress and the Government Accountability Office 
pursuant to the Congressional Review Act, see 5 U.S.C. 801(a)(1)(A).
    34. Accordingly, it is ordered, pursuant to Sections 1, 4(i), 201-
205, and 226(h)(1)(A) of the Communications Act of 1934, as amended, 47 
U.S.C. 151, 154(i), 201-205, 226(h)(1)(A), that this Report and Order 
is adopted.
    35. It is further ordered that the final rules and rule revisions 
adopted in this Report and Order shall become effective either November 
17, 2011 or following

[[Page 43210]]

approval by the Office of Management and Budget, whichever date is 
later. The Commission will publish a document at a later date 
establishing the effective date.
    36. It is further ordered that nondominant carriers shall file 
their initial Base Document using the Electronic Tariff Filing System 
no later than sixty (60) days after the final rules and revisions 
adopted in this Report and Order become effective.
    37. It is further ordered, that the Commission's Consumer and 
Governmental Affairs Bureau, Reference Information Center, shall send a 
copy of this Report and Order, including the Final Regulatory 
Flexibility Analysis, to the Chief Counsel for Advocacy of the Small 
Business Administration.

List of Subjects in 47 CFR Parts 61 and 64

    Communications common carrier, Reporting and recordkeeping 
requirements.

Federal Communications Commission.
Bulah P. Wheeler,
Deputy Manager.

    For the reasons discussed in the preamble, the Federal 
Communications Commission amends 47 CFR parts 61 and 64 as follows:

PART 61--TARIFFS

0
1. The authority citation for part 61 continues to read as follows:

    Authority:  Secs. 1, 4(i), 4(j), 201-205 and 403 of the 
Communications Act of 1934, as amended; 47 U.S.C. 151, 154(i), 
154(j), 201-205 and 403, unless otherwise noted.


0
2. Section 61.3 is amended by redesignating paragraphs (t) through (y) 
as paragraphs (u) through (z) and by adding paragraph (t) to read as 
follows:


Sec.  61.3  Definitions.

* * * * *
    (t) Incumbent Local Exchange Carrier. ``Incumbent Local Exchange 
Carrier'' or ``ILEC'' has the same meaning as that term is defined in 
47 U.S.C. 251(h).
* * * * *

0
3. Section 61.13 is amended by revising paragraphs (a) and (b) to read 
as follows:


Sec.  61.13  Scope.

    (a) This applies to all tariff publications of issuing carriers 
required to file tariff publications electronically, and any tariff 
publication that a carrier chooses to file electronically.
    (b) All issuing carriers that file tariffs are required to file 
tariff publications electronically.
* * * * *

0
4. Section 61.14 is amended by revising paragraphs (b) and (e) to read 
as follows:


Sec.  61.14  Method of filing publications.

* * * * *
    (b) In addition, except for issuing carriers filing tariffing fees 
electronically, for all tariff publications requiring fees as set forth 
in part 1, subpart G of this chapter, issuing carriers must submit the 
original of the cover letter (without attachments), FCC Form 159, and 
the appropriate fee to the address set forth in Sec.  1.1105 of this 
chapter.
* * * * *
    (e) Carriers that are required to file publications electronically 
must comply with the format requirements set forth in Sec. Sec.  61.52 
and 61.54, with the exception of the informational tariffs filed 
pursuant to 47 U.S.C. 226(h)(1)(A).

0
5. Section 61.15 is revised to read as follows:


Sec.  61.15  Letters of transmittal and cover letters.

    (a) All tariff publications filed with the Commission 
electronically must be accompanied by a letter of transmittal. All 
letters of transmittal filed with the Commission must be numbered 
consecutively by the issuing carrier beginning with Number 1. All 
letters of transmittal must also:
    (1) Concisely explain the nature and purpose of the filing;
    (2) Specify whether supporting information is required for the new 
tariff or tariff revision, and specify the Commission rule or rules 
governing the supporting information requirements for that filing;
    (3) Contain a statement indicating the date and method of filing of 
the original of the transmittal as required by Sec.  61.14(b);
    (4) Include the FCC Registration Number (FRN) of the carrier(s) on 
whose behalf the cover letter is submitted. See subpart W of part 1 of 
this title.
    (b) Local exchange carriers filing tariffs electronically pursuant 
to the notice requirements of section 204(a)(3) of the Communications 
Act shall display prominently, in the upper right hand corner of the 
letter of transmittal, a statement that the filing is made pursuant to 
that section and whether the tariff is filed on 7 or 15 days notice.
    (c) Any carrier filing a new or revised tariff made on 15 days' 
notice or less shall include in the letter of transmittal the name, 
room number, street address, telephone number, and facsimile number of 
the individual designated by the filing carrier to receive personal or 
facsimile service of petitions against the filing as required under 
Sec.  1.773(a)(4) of this chapter.
    (d) International carriers must certify that they are authorized 
under Section 214 of the Communications Act of 1934, as amended, to 
provide service, and reference the FCC file number of that 
authorization.
    (e) In addition to the requirements set forth in paragraph (a) of 
this section, any incumbent local exchange carrier choosing to file an 
Access Tariff under Sec.  61.39 must include in the transmittal:
    (1) A summary of the filing's basic rates, terms and conditions;
    (2) A statement concerning whether any prior Commission facility 
authorization necessary to the implementation of the tariff has been 
obtained; and
    (3) A statement that the filing is made pursuant to Sec.  61.39.
    (f) In addition to the requirements set forth in paragraph (a) of 
this section, any price cap local exchange carrier filing a price cap 
tariff must include in the letter of transmittal a statement that the 
filing is made pursuant to Sec.  61.49.
    (g) The letter of transmittal must specifically reference by number 
any special permission necessary to implement the tariff publication. 
Special permission must be granted prior to the filing of the tariff 
publication and may not be requested in the transmittal letter.
    (h)(1) The letter of transmittal must be substantially in the 
following format:
-----------------------------------------------------------------------
(Exact name of carrier in full)
-----------------------------------------------------------------------
(Post Office Address)
-----------------------------------------------------------------------
(Date)
-----------------------------------------------------------------------
Transmittal No.

Secretary, Federal Communications Commission; Washington, DC 20554

Attention: Wireline Competition Bureau

    The accompanying tariff (or other publication) issued by ------
--, and bearing FCC No. --------, effective --------, 20--, is sent 
to you for filing in compliance with the requirements of the 
Communications Act of 1934, as amended. (Here give the additional 
information required.)
-----------------------------------------------------------------------
(Name of issuing officer or agent)
-----------------------------------------------------------------------
-----------------------------------------------------------------------
    (Title)

    (2) A separate letter of transmittal may accompany each 
publication, or the above format may be modified to provide for filing 
as many publications as desired with one transmittal letter.
    (i) All submissions of documents other than a new tariff or 
revisions to an existing tariff, such as Base Documents or Tariff 
Review Plans, must be

[[Page 43211]]

accompanied by a cover letter that concisely explains the nature and 
purpose of the filing. Publications submitted under this paragraph are 
not required to submit a tariffing fee.

0
6. Section 61.16 is revised to read as follows:


Sec.  61.16  Base documents.

    (a) The Base Document is a complete tariff which incorporates all 
effective revisions, as of the last day of the preceding month. The 
Base Document should be submitted with a cover letter as specified in 
Sec.  61.15(i) and identified as the Monthly Updated Base Document.
    (b) If there have been revisions that became effective up to and 
including the last day of the preceding month, a new Base Document must 
be submitted within the first five business days of the current month 
that will incorporate those revisions.

0
7. Section 61.17 is revised to read as follows:


Sec.  61.17  Applications for special permission.

    (a) All issuing carriers that file applications for special 
permission, associated documents, such as transmittal letters, requests 
for special permission, and supporting information, shall file those 
documents electronically.
    (b) Applications for special permission must contain:
    (1) A detailed description of the tariff publication proposed to be 
put into effect;
    (2) A statement citing the specific rules and the grounds on which 
waiver is sought;
    (3) A showing of good cause; and
    (4) The appropriate Illustrative tariff pages the issuing carrier 
wishes to either revise or add as new pages to its tariff.
    (c) An application for special permission must be addressed to 
``Secretary, Federal Communications Commission, Washington, DC 20554.'' 
The Electronic Tariff Filing System will accept filings 24 hours a day, 
seven days a week. The official filing date of a publication received 
by the Electronic Tariff Filing System will be determined by the date 
and time the transmission ends. If the transmission ends after the 
close of a business day, as that term is defined in Sec.  1.4(e)(2) of 
this chapter, the filing will be date and time stamped as of the 
opening of the next business day.
    (d) In addition, except for issuing carriers filing tariffing fees 
electronically, for special permission applications requiring fees as 
set forth in part 1, subpart G of this chapter, issuing carriers must 
submit the original of the application letter (without attachments), 
FCC Form 159, and the appropriate fee to the address set forth in Sec.  
1.1105 of this chapter.
    (e) In addition, if an issuing carrier applies for special 
permission to revise joint tariffs, the application must state that it 
is filed on behalf of all carriers participating in the affected 
service. Applications must be numbered consecutively in a series 
separate from FCC tariff numbers and Letters of Transmittal, bear the 
signature of the officer or agent of the carrier, and be in the 
following format:

Application No.--------------------------------------------------------

(Date)-----------------------------------------------------------------

    Secretary, Federal Communications Commission, Washington, DC 
20554.

Attention: Wireline Competition Bureau (here provide the statements 
required by section 61.17(b)).

(Exact name of carrier)------------------------------------------------

(Name of officer or agent)---------------------------------------------

(Title of officer or agent)--------------------------------------------

    (f) If approved, the issuing carrier must comply with all terms and 
use all authority specified in the grant. If a carrier elects to use 
less than the authority granted, it must apply to the Commission for 
modification of the original grant. If a carrier elects not to use the 
authority granted within sixty days of its effective date, the original 
grant will be automatically cancelled by the Commission.

0
8. Section 61.20 is revised to read as follows:


Sec.  61.20  Method of filing publications.

    (a) All issuing carriers that file tariffs shall file all tariff 
publications and associated documents, such as transmittal letters, 
requests for special permission, and supporting information, 
electronically in accordance with the requirements set forth in Sec.  
61.13 through Sec.  61.17.
    (b) In addition, except for issuing carriers filing tariffing fees 
electronically, for all tariff publications requiring fees as set forth 
in part 1, subpart G of this chapter, issuing carriers must submit the 
original of the cover letter (without attachments), FCC Form 159, and 
the appropriate fee to the address set forth in Sec.  1.1105 of this 
chapter.


Sec. Sec.  61.21 through 61.23  [Removed]

0
9. Remove Sec. Sec.  61.21 though 61.23.


Sec. Sec.  61.32 and 61.33  [Removed]

0
10. Remove Sec. Sec.  61.32 and 61.33.

0
11. Section 61.38 is revised to read as follows:


Sec.  61.38  Supporting information to be submitted with letters of 
transmittal.

    (a) Scope. This section applies to dominant carriers whose gross 
annual revenues exceed $500,000 for the most recent 12 month period of 
operations or are estimated to exceed $500,000 for a representative 12 
month period. Incumbent Local Exchange Carriers serving 50,000 or fewer 
access lines in a given study area that are described as subset 3 
carriers in Sec.  69.602 of this chapter may submit Access Tariff 
filings for that study area pursuant to either this section or Sec.  
61.39. However, the Commission may require any issuing carrier to 
submit such information as may be necessary for a review of a tariff 
filing. This section (other than the preceding sentence of this 
paragraph) shall not apply to tariff filings proposing rates for 
services identified in Sec.  61.42 (d), (e), and (g).
    (b) Explanation and data supporting either changes or new tariff 
offerings. The material to be submitted for a tariff change which 
affects rates or charges or for a tariff offering a new service, must 
include an explanation of the changed or new matter, the reasons for 
the filing, the basis of ratemaking employed, and economic information 
to support the changed or new matter.
    (1) For a tariff change the issuing carrier must submit the 
following, including complete explanations of the bases for the 
estimates.
    (i) A cost of service study for all elements for the most recent 12 
month period;
    (ii) A study containing a projection of costs for a representative 
12 month period;
    (iii) Estimates of the effect of the changed matter on the traffic 
and revenues from the service to which the changed matter applies, the 
issuing carrier's other service classifications, and the carrier's 
overall traffic and revenues. These estimates must include the 
projected effects on the traffic and revenues for the same 
representative 12 month period used in (b)(1)(ii) above.
    (2) For a tariff filing offering a new service, the issuing carrier 
must submit the following, including complete explanations of the bases 
for the estimates.
    (i) A study containing a projection of costs for a representative 
12 month period; and
    (ii) Estimates of the effect of the new matter on the traffic and 
revenues from the service to which the new matter applies, the issuing 
carrier's other service classifications, and the issuing carrier's 
overall traffic and revenues. These estimates must include the 
projected effects on the traffic and

[[Page 43212]]

revenues for the same representative 12 month period used in paragraph 
(b)(2)(i) of this section.
    (3) [Reserved]
    (4) For a tariff that introduces a system of density pricing zones, 
as described in Sec.  69.123 of this chapter, the issuing carrier must, 
before filing its tariff, submit a density pricing zone plan including, 
inter alia, documentation sufficient to establish that the system of 
zones reasonably reflects cost-related characteristics, such as the 
density of total interstate traffic in central offices located in the 
respective zones, and receive approval of its proposed plan.
    (c) Working papers and statistical data. (1) Concurrently with the 
filing of any tariff change or tariff filing for a service not 
previously offered, the issuing carrier must file the working papers 
containing the information underlying the data supplied in response to 
paragraph (b) of this section, and a clear explanation of how the 
working papers relate to that information.
    (2) All statistical studies must be submitted and supported in the 
form prescribed in Sec.  1.363 of this chapter.
    (d) Form and content of additional material to be submitted with 
certain rate increases. In the circumstances set out in paragraphs 
(d)(1) and (2) of this section, the issuing carrier must submit all 
additional cost, marketing and other data underlying the working papers 
to justify a proposed rate increase. The issuing carrier must submit 
this information in suitable form to serve as the carrier's direct case 
in the event the rate increase is set by the Commission for 
investigation.
    (1) Rate increases affecting single services or tariffed items.
    (i) A rate increase in any service or tariffed item which results 
in more than $1 million in additional annual revenues, calculated on 
the basis of existing quantities in service, without regard to the 
percentage increase in such revenues; or
    (ii) A single rate increase in any service or tariffed item, or 
successive rate increases in the same service or tariffed item within a 
12 month period, either of which results in:
    (A) At least a 10 percent increase in annual revenues from that 
service or tariffed item, and
    (B) At least $100,000 in additional annual revenues, both 
calculated on the basis of existing quantities in service.
    (2) Rate increases affecting more than one service or tariffed 
item.
    (i) A general rate increase in more than one service or tariffed 
item occurring at one time, which results in more than $1 million in 
additional revenues calculated on the basis of existing quantities in 
service, without regard to the percentage increase in such revenues; or
    (ii) A general rate increase in more than one service or tariffed 
item occurring at one time, or successive general rate increases in the 
same services or tariffed items occurring within a 12 month period, 
either of which results in:
    (A) At least a 10 percent increase in annual revenues from those 
services or tariffed items, and
    (B) At least $100,000 in additional annual revenues, both 
calculated on the basis of existing quantities in service.
    (e) Submission of explanation and data by connecting carriers. If 
the changed or new matter is being filed by the issuing carrier at the 
request of a connecting carrier, the connecting carrier must provide 
the data required by paragraphs (b) and (c) of this section on the date 
the issuing carrier files the tariff matter with the Commission.
    (f) Copies of explanation and data to customers. Concurrently with 
the filing of any rate for special construction (or special assembly 
equipment and arrangements) developed on the basis of estimated costs, 
the issuing carrier must transmit to the customer a copy of the 
explanation and data required by paragraphs (b) and (c) of this 
section.
    (g) On each page of cost support material submitted pursuant to 
this section, the issuing carrier shall indicate the transmittal number 
under which that page was submitted.

0
12. Section 61.39 is revised to read as follows:


Sec.  61.39  Optional supporting information to be submitted with 
letters of transmittal for Access Tariff filings by incumbent local 
exchange carriers serving 50,000 or fewer access lines in a given study 
area that are described as subset 3 carriers in Sec.  69.602.

    (a) Scope. This section provides for an optional method of filing 
for any incumbent local exchange carrier that is described as subset 3 
carrier in Sec.  69.602 of this chapter, which elects to issue its own 
Access Tariff for a period commencing on or after April 1, 1989, and 
which serves 50,000 or fewer access lines in a study area as determined 
under Sec.  36.611(a)(8) of this chapter. However, the Commission may 
require any issuing carrier to submit such information as may be 
necessary for review of a tariff filing. This section (other than the 
preceding sentence of this paragraph) shall not apply to tariff filings 
of price cap local exchange carriers.
    (b) Explanation and data supporting tariff changes. The material to 
be submitted to either a tariff change or a new tariff which affects 
rates or charges must include an explanation of the filing in the 
transmittal as required by Sec.  61.15. The basis for ratemaking must 
comply with the following requirements. Except as provided in paragraph 
(b)(5) of this section, it is not necessary to submit this supporting 
data at the time of filing. However, the incumbent local exchange 
carrier should be prepared to submit the data promptly upon reasonable 
request by the Commission or interested parties.
    (1) For a tariff change, the incumbent local exchange carrier that 
is a cost schedule carrier must propose Traffic Sensitive rates based 
on the following:
    (i) For the first period, a cost of service study for Traffic 
Sensitive elements for the most recent 12-month period with related 
demand for the same period.
    (ii) For subsequent filings, a cost of service study for Traffic 
Sensitive elements for the total period since the incumbent local 
exchange carrier's last annual filing, with related demand for the same 
period.
    (2) For a tariff change, the incumbent local exchange carrier that 
is an average schedule carrier must propose Traffic Sensitive rates 
based on the following:
    (i) For the first period, the incumbent local exchange carrier's 
most recent annual Traffic Sensitive settlement from the National 
Exchange Carrier Association pool.
    (ii) For subsequent filings, an amount calculated to reflect the 
Traffic Sensitive average schedule pool settlement the carrier would 
have received if the carrier had continued to participate, based upon 
the most recent average schedule formulas approved by the Commission.
    (3) For a tariff change, the incumbent local exchange carrier that 
is a cost schedule carrier must propose Common Line rates based on the 
following:
    (i) For the first biennial filing, the common line revenue 
requirement shall be determined by a cost of service study for the most 
recent 12-month period. Subscriber line charges shall be based on cost 
and demand data for the same period. Carrier common line rates shall be 
determined by the following formula:

[[Page 43213]]

[GRAPHIC] [TIFF OMITTED] TR20JY11.005

Where:
[GRAPHIC] [TIFF OMITTED] TR20JY11.006

And where:

CCL Rev Req = carrier common line revenue requirement for the most 
recent 12-month period;
CCL MOUb = carrier common line minutes of use for the 
most recent 12-month period;
CCL MOU1 = CCL MOUb; and
CCL MOU0 = carrier common line minutes of use for the 12-
month period preceding the most recent 12-month period.

    (ii) For subsequent biennial filings, the common line revenue 
requirement shall be determined by a cost of service study for the most 
recent 24-month period. Subscriber line charges shall be based on cost 
and demand data for the same period. Carrier common line rates shall be 
determined by the following formula:
[GRAPHIC] [TIFF OMITTED] TR20JY11.007

Where:
[GRAPHIC] [TIFF OMITTED] TR20JY11.008

And where:

CCL Rev Req = carrier common line revenue requirement for the most 
recent 24-month period;
CCL MOUb = carrier common line minutes of use for the 
most recent 24-month period;
CCL MOU1 = carrier common line minutes of use for the 12-
month period; and
CCL MOU0 = carrier common line minutes of use for the 12-
month period preceding the most recent 12-month period.

    (4) For a tariff change, the incumbent local exchange carrier which 
is an average schedule carrier must propose common line rates based on 
the following:
    (i) For the first biennial filings, the common line revenue 
requirement shall be determined by the incumbent local exchange 
carrier's most recent annual Common Line settlement from the National 
Exchange Carrier Association. Subscriber line charges shall be based on 
cost and demand data for the same period. Carrier common line rates 
shall be determined by the following formula:
[GRAPHIC] [TIFF OMITTED] TR20JY11.009

Where:
[GRAPHIC] [TIFF OMITTED] TR20JY11.010

And where:

CCL Rev Req = carrier common line settlement for the most recent 12-
month period;
CCL MOUb = carrier common line minutes of use for the 
most recent 12-month period;
CCL MOU1 = CCL MOUb; and
CCL MOU0 = carrier common line minutes of use for the 12-
month period preceding the most recent 12-month period.

    (ii) For subsequent biennial filings, the common line revenue 
requirement shall be an amount calculated to reflect the average 
schedule pool settlements the carrier would have received if the 
carrier had continued to participate in the carrier common line pool, 
based upon the average schedule Common Line formulas developed by the 
National Exchange Carrier Association for the most recent 24-month 
period. Subscriber line charges shall be based on cost and demand data 
for the same period. Carrier common line rates shall be determined by 
the following formula:
[GRAPHIC] [TIFF OMITTED] TR20JY11.011

Where:
[GRAPHIC] [TIFF OMITTED] TR20JY11.012

And where:

CCL Rev Req = carrier common line settlement for the most recent 24-
month period;
CCL MOUb = carrier common line minutes of use for the 
most recent 24-month period;
CCL MOU1 = carrier common line minutes of use for the 
most recent 12-month period; and
CCL MOU0 = carrier common line minutes of use for the 12-
month period preceding the most recent 12-month period.

    (5) For End User Common Line charges included in a tariff pursuant 
to this Section, the incumbent local exchange carrier must provide 
supporting information for the two-year historical period with its 
letter of transmittal in accordance with Sec.  61.38.
    (c) Maximum allowable rate of return. Incumbent Local exchange 
carriers filing tariffs under this section are not required to comply 
with Sec. Sec.  65.700 through 65.701 of this chapter, except with 
respect to periods during which tariffs were not subject to this 
section. The Commission may require any carrier to submit such 
information if it deems it necessary to monitor the carrier's earnings. 
However, rates must be calculated based on the incumbent local exchange 
carrier's prescribed rate of return applicable to the period during 
which the rates are effective.
    (d) Rates for a new service that is the same as that offered by a 
price cap local exchange carrier providing service in an adjacent 
serving area are deemed presumptively lawful, if the proposed rates, in 
the aggregate, are no greater than the rates established by the price 
cap local exchange carrier. Tariff filings made pursuant to this 
paragraph must include the following:
    (1) A brief explanation of why the service is like an existing 
service offered by a geographically adjacent price cap local exchange 
carrier; and
    (2) Data to establish compliance with this paragraph that, in 
aggregate, the proposed rates for the new service are no greater than 
those in effect for the same or comparable service offered by that same 
geographically adjacent price cap regulated local exchange carrier. 
Compliance may be shown through submission of applicable tariff pages 
of the adjacent carrier; a showing that the serving areas are adjacent; 
any necessary explanations and work sheets.
    (e) Average schedule companies filing pursuant to this section 
shall retain their status as average schedule companies.
    (f) On each page of cost support material submitted pursuant to 
this section, the issuing carrier shall indicate the transmittal number 
under which that page was submitted.
    13. Section 61.40 is amended by revising paragraph (a) introductory 
text to read as follows:


Sec.  61.40  Private line rate structure guidelines.

    (a) The Commission uses a variety of tools to determine whether a 
dominant carrier's private line tariffs are just, reasonable, and 
nondiscriminatory. The dominant carrier's burden of cost justification 
can be reduced when its private line rate structures comply with the 
following five guidelines.
* * * * *

0
14. Section 61.41 is amended by revising paragraph (a)(2) to read as 
follows:


Sec.  61.41  Price cap requirements generally.

    (a) * * *
    (2) To such price cap local exchange carriers as specified by 
Commission

[[Page 43214]]

order, and to all local exchange carriers, other than average schedule 
companies, that are affiliated with such carriers; and
* * * * *

0
15. Section 61.42 is amended by revising paragraphs (d) introductory 
text, (d)(4), (e)(1) introductory text, and (f) to read as follows:


Sec.  61.42  Price cap baskets and service categories.

* * * * *
    (d) Each price cap local exchange carrier shall establish baskets 
of services as follows:
* * * * *
    (4)(i) To the extent that a price cap local exchange carrier 
specified in Sec.  61.41(a)(2) or (a)(3) offers interstate 
interexchange services that are not classified as access services for 
the purpose of part 69 of this chapter, such exchange carrier shall 
establish a fourth basket for such services. For purposes of Sec. Sec.  
61.41 through 61.49, this basket shall be referred to as the 
``interexchange basket.''
    (ii) If a price cap local exchange carrier has implemented 
interLATA and intraLATA toll dialing parity everywhere it provides 
local exchange services at the holding company level, that price cap 
carrier may file a tariff revision to remove corridor and interstate 
intraLATA toll services from its interexchange basket.
* * * * *
    (e)(1) The traffic sensitive switched interstate access basket 
shall contain such services as the Commission shall permit or require, 
including the following service categories:
* * * * *
    (f) Each price cap local exchange carrier shall exclude from its 
price cap baskets such services or portions of such services as the 
Commission has designated or may hereafter designate by order.
* * * * *

0
16. Section 61.43 is revised to read as follows:


Sec.  61.43  Annual price cap filings required.

    Price cap local exchange carriers shall submit annual price cap 
tariff filings that propose rates for the upcoming tariff year, that 
make appropriate adjustments to their PCI, API, and SBI values pursuant 
to Sec. Sec.  61.45 through 61.47, and that incorporate new services 
into the PCI, API, or SBI calculations pursuant to Sec. Sec.  61.45(g), 
61.46(b), and 61.47(b) and (c). Price cap local exchange carriers may 
propose rate, PCI, or other tariff changes more often than annually, 
consistent with the requirements of Sec.  61.59.

0
17. Section 61.45 is amended by revising paragraphs (a), (b)(1)(i) 
introductory text, and (d)(2) to read as follows:


Sec.  61.45  Adjustments to the PCI for Local Exchange Carriers.

    (a) Price cap local exchange carriers shall file adjustments to the 
PCI for each basket as part of the annual price cap tariff filing, and 
shall maintain updated PCIs to reflect the effect of mid-year exogenous 
cost changes.
    (b)(1)(i) Adjustments to price cap local exchange carrier PCIs, in 
those carriers' annual access tariff filings, the traffic sensitive 
basket described in Sec.  61.42(d)(2), the trunking basket described in 
Sec.  61.42(d)(3), the special access basket described in Sec.  
61.42(d)(5) and the Interexchange Basket described in Sec.  
61.42(d)(4)(i), shall be made pursuant to the following formula:
* * * * *
    (d) * * *
    (2) Price cap local exchange carriers specified in Sec. Sec.  
61.41(a)(2) or (a)(3) shall, in their annual access tariff filing, 
recognize all exogenous cost changes attributable to modifications 
during the coming tariff year in their Subscriber Plant Factor and the 
Dial Equipment Minutes factor, and completions of inside wire 
amortizations and reserve deficiency amortizations.
* * * * *

0
18. Section 61.46 is amended by revising paragraph (a) introductory 
text to read as follows:


Sec.  61.46  Adjustments to the API.

    (a) Except as provided in paragraphs (d) and (e) of this section, 
in connection with any price cap tariff filing proposing rate changes, 
the price cap local exchange carrier must calculate an API for each 
affected basket pursuant to the following methodology:
* * * * *

0
19. Section 61.47 is amended by revising paragraphs (f), (i)(2), and 
(i)(5) to read as follows:


Sec.  61.47  Adjustments to the SBI; pricing bands.

* * * * *
    (f) A price cap local exchange carrier may establish density zones 
pursuant to the requirements set forth in Sec.  69.123 of this chapter, 
for any service in the trunking and special access baskets, other than 
the interconnection charge set forth in Sec.  69.124 of this chapter. 
The pricing flexibility of each zone shall be limited to an annual 
increase of 15 percent, relative to the percentage change in the PCI 
for that basket, measured from the levels in effect on the last day of 
the preceding tariff year. There shall be no lower pricing band for any 
density zone.
* * * * *
    (i) * * *
    (2) Effective January 1, 1998, notwithstanding the requirements of 
paragraph (a) of this section, if a price cap local exchange carrier is 
recovering interconnection charge revenues through per-minute rates 
pursuant to Sec.  69.155 of this chapter, any reductions to the PCI for 
the basket designated in Sec.  61.42(d)(3) resulting from the 
application of the provisions of Sec.  61.45(b)(1)(i) and from the 
application of the provisions of Sec. Sec.  61.45(i)(1) and 61.45(i)(2) 
shall be directed to the SBI of the service category designated in 
Sec.  61.42(d)(i).
* * * * *
    (5) Effective July 1, 2000, notwithstanding the requirements of 
paragraph (a) of this section and subject to the limitations of Sec.  
61.45(i), if a price cap local exchange carrier is recovering an ATS 
charge greater than its Target Rate as set forth in Sec.  61.3(qq), any 
reductions to the PCI for the traffic sensitive or trunking baskets 
designated in Sec. Sec.  61.42(d)(2) and 61.42(d)(3) resulting from the 
application of the provisions of Sec.  61.45(b), and the formula in 
Sec.  61.45(b) and from the application of the provisions of Sec. Sec.  
61.45(i)(1), and 61.45(i)(2) shall be directed to the SBIs of the 
service categories designated in Sec. Sec.  61.42(e)(1) and 
61.42(e)(2).
* * * * *

0
20. Section 61.48 is amended by revising paragraphs (i)(2), (i)(3) 
introductory text, (i)(4), and (l)(2) to read as follows:


Sec.  61.48  Transition rules for price cap formula calculations.

* * * * *
    (i) * * *
    (2) Simultaneous Introduction of Special Access and Transport 
Zones. Price cap local exchange carriers that have established density 
pricing zones pursuant to Sec.  69.123 of this chapter, and whose 
special access zone date and transport zone date occur on the same 
date, shall initially establish density pricing zone SBIs and bands 
pursuant to the methodology in Sec. Sec.  61.47(e) through (f).
    (3) Sequential Introduction of Zones in the Same Tariff Year. 
Notwithstanding Sec. Sec.  61.47(e) through (f), price cap local 
exchange carriers that have established density pricing zones pursuant 
to Sec.  69.123 of this chapter, and whose special access zone date and 
transport zone date occur on different dates during the same tariff 
year, shall,

[[Page 43215]]

on the earlier date, establish density pricing zone SBIs and pricing 
bands using the methodology described in Sec. Sec.  61.47(e) through 
(f), but applicable to the earlier service only. On the later date, 
such carriers shall recalculate the SBIs and pricing bands to lim