No. 32162: R746-360. Universal Public Telecommunications Service Support Fund

DAR File No.: 32162
Filed: 11/25/2008, 10:59
Received by: NL

NOTICE OF REVIEW AND STATEMENT OF CONTINUATION

Concise explanation of the particular statutory provisions under which the rule is enacted and how these provisions authorize or require the rule:

Section 54-8b-15 requires that the Public Service Commission (PSC) establish rules governing the administration of the fund. This rule governs maintenance of the fund, establishes its revenue sources and disbursement procedures, to support residential local access networks from the fund and amounts collected through rates and charges paid by service end-users. All qualifying telecommunications corporations are able to draw from the fund, which collects and distributes funds in a nondiscriminatory and a competitively and technologically neutral way.

Summary of written comments received during and since the last five-year review of the rule from interested persons supporting or opposing the rule:

In 2004 comments were received from the Division of Public Utilities regarding changes to the one-time distribution portions of the rule. The Division suggested to lower the cap amount of the fund to $10,000 per customer. Qwest concurred with the proposed amendment submitted by the Division of Public Utilities but had concerns with unintended effects on Utah customers and the telecommunications market. After consideration of submitted comments the PSC amended the rule, changing the total amount of money the Universal Service Support Fund will pay for a project from $25,000 to $10,000. The change also increased the percentage of the costs of a relatively low-cost project that is paid for by the Universal Service Support fund. It decreased the percentage of costs paid for by the Fund for relatively expensive projects. In 2006 the Division of Public Utilities recommended the Universal Service Fund surcharge should decrease from 0.9% to 0.5% which would decrease the fund balance from $6,500,000 to about $4,000,000 over the projected time period. Qwest responded in comments by requesting the rule change be made effective the first of the month to coincide with the start of the new billing cycle. The PSC amended the rule to reduce the surcharge and made the change effective in July 2006. In September of 2008 comments were received suggesting changes to amend the definition of basic telecommunications service in Utah. The proposal was to add CLASS calling features and voice-mail features whose costs would be recovered through the state fund. The PSC considered the proposals but denied the request to amend the rule. The PSC did not believe amending the definition of basic service to include these optional services was warranted at this time and consistent with the purpose of the state and federal universal service funds. The PSC desires to see what changes arise from the federal government's efforts to revise the federal universal service fund support mechanisms that may cover these services and take advantage of federal funding if these services are to be supported through subsidies. Also in September 2008 the Division of Public Utilities suggested decreasing the surcharge rate to decrease the prospect of a higher Fund balance not warranted by anticipated future expenditures. PSC amended the rule and changed the existing surcharge of 0.5 percent to 0.45%.

Reasoned justification for continuation of the rule, including reasons why the agency disagrees with comments in opposition to the rule, if any:

This rule continues to be necessary so that the PSC can continue governing the administration and maintenance of the fund and to establishes its revenue sources and disbursement procedures and should be continued.

The full text of this rule may be inspected, during regular business hours, at the Division of Administrative Rules, or at:

Public Service Commission
Administration
HEBER M WELLS BLDG
160 E 300 S
SALT LAKE CITY UT 84111-2316

Direct questions regarding this rule to:

Sandy Mooy or Sheri Bintz at the above address, by phone at 801-530-6708 or 801-530-6714, by FAX at 801-530-6796 or 801-530-6796, or by Internet E-mail at [e-mail] or [e-mail]

Authorized by:

Sandy Mooy, Legal Counsel