No. 41644 (Amendment): Section R746-360-4. Application of Fund Surcharges to Customer Billings

(Amendment)

DAR File No.: 41644
Filed: 05/15/2017 12:54:12 PM

RULE ANALYSIS

Purpose of the rule or reason for the change:

The reason for this amendment is to comply with S.B. 130, which was passed during the 2017 General Session, and which requires that all telecommunications access lines be assessed for purposes of funding the Utah Universal Public Telecommunications Service Support Fund (UUSF).

Summary of the rule or change:

Through 07/31/2017, providers of access lines, as defined at Subsection 54-8b-2(1), are required to remit to the Public Service Commission of Utah (PSC) 1.65% of their billed intrastate retail rates. As of 08/01/2017, providers of access lines are required to collect from their end-user customers a monthly surcharge of $0.36 per access line and remit to the PSC at least 98.69% of the total monthly surcharge collections. In order to comply with federal law, the rule includes a mechanism whereby an end-user may be exempted from the per-connection surcharge on a showing that the end-user does not use the access line at issue to facilitate Utah intrastate telecommunications services.

Statutory or constitutional authorization for this rule:

• Section 54-3-1
• Section 54-4-1
• Section 54-8b-15

Anticipated cost or savings to:

the state budget:

The PSC and the Division of Public Utilities have been administering the UUSF for many years and have the budget to continue doing so. The change in the surcharge mechanism will not have a fiscal impact on the state budget.

local governments:

Local governments are not required to comply with or enforce the rules through which the UUSF is funded. No fiscal impact to local government is anticipated.

small businesses:

Small businesses that provide access lines will be required to adjust their billing in order to assess and remit a per-connection surcharge (as opposed to remitting a percentage of their revenues). To comply, these businesses might need to change or modify their billing software. All such costs were considered by the Legislature in determining to allow migration to a per-connection surcharge. Further, such costs will vary and cannot be estimated by the PSC. However, the PSC notes that most of the small businesses affected by this rule have historically assessed a per-connection surcharge in order to fund a program that provides telephony assistance to individuals who are deaf, hard of hearing, or severely speech challenged. Therefore, the PSC anticipates that, for the majority of affected businesses, the migration from a revenue-based remittance to a connection-based remittance will not pose a meaningful fiscal burden.

persons other than small businesses, businesses, or local governmental entities:

Customers of businesses that provide access lines will be charged $0.36 per month per access line.

Compliance costs for affected persons:

To comply, affected persons must collect from their customers and remit to the PSC a monthly per-connection surcharge. Providers of access lines will need to obtain or modify billing software accordingly. The associated costs will vary and cannot be anticipated. However, where most providers have historically collected a per-connection surcharge to comply with other statutory requirements, it is anticipated that the associated costs will be minimal.

Comments by the department head on the fiscal impact the rule may have on businesses:

As stated in the rule analysis, the fiscal impact to businesses will result from IT programming or software that might be necessary in order to comply with a per-connection surcharge requirement rather than a revenue-based remittance requirement. It is anticipated that the conversion costs will be minimal and well within the regulatory budget of Utah's access line providers.

Thad LeVar, Chair

The full text of this rule may be inspected, during regular business hours, at the Office 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:

• Sheri Bintz at the above address, by phone at 801-530-6714, by FAX at 801-530-6796, or by Internet E-mail at [e-mail]
• Jennie Jonsson at the above address, by phone at 801-530-6763, by FAX at , or by Internet E-mail at [e-mail]

Interested persons may present their views on this rule by submitting written comments to the address above no later than 5:00 p.m. on:

07/03/2017

This rule may become effective on:

07/10/2017

Authorized by:

Jennie Jonsson, Administrative Law Judge

RULE TEXT

R746. Public Service Commission, Administration.

R746-360. Universal Public Telecommunications Service Support Fund.

R746-360-4. Application of Fund Surcharges to Customer Billings.

[A. Commencement of Surcharge Assessments -- Commencing June 1, 1998, end-user surcharges shall be the source of revenues to support the fund. Surcharges will be applied to intrastate retail rates, and shall not apply to wholesale services.

B. Surcharge Based on a Uniform Percentage of Retail Rates -- The retail surcharge shall be a uniform percentage rate, determined and reviewed annually by the Commission and billed and collected by all retail providers.

C. Surcharge -- The surcharge to be assessed is as follows:

1. through September 30, 2016, 1 percent of billed intrastate retail rates; and

2. beginning October 1, 2016, 1.65 percent of billed intrastate retail rates.]

(1)(a) "Access line" is defined at Utah Code Subsection 54-8b-2(1).

(b) For purposes of applying the statutory definition of "access line," the "functional equivalent of a circuit-switched connection from an end-user to the public switched network" means equipment or technology that allows an end-user to place or receive a real-time voice communication.

(c) Providers of access lines and functionally equivalent connections are hereafter referred to jointly as "providers." (2) Through July 31, 2017, providers shall remit to the Commission 1.65 percent of billed intrastate retail rates.

(3)(a) As of August 1, 2017, and unless Subsection R746-360-4(5) applies, providers shall collect from their end-user customers $0.36 per month per access line:

(i) that has a physical endpoint within the State of Utah; or

(ii) as to which the provider has record of an associated address within the State of Utah.

(b) The surcharge shall apply directly to each end-user as a separate charge and shall not be included in, nor paid from, the provider's rates or telecommunications revenues.

(4)(a) A provider shall remit to the Commission no less than 98.69 percent of its total monthly surcharge collections.

(b) A provider may retain a maximum of 1.31 percent of its total monthly surcharge collections to offset the costs of administering this rule.

(5)(a) An end-user may petition the Commission for a waiver of the surcharge set forth in Subsection R746-360-4(3). Any such petition shall be adjudicated as an informal administrative proceeding.

(b) An end-user that petitions for a waiver of the surcharge has the burden to provide billing records or other substantial documentary evidence demonstrating that, at all times and continuously during the six calendar months preceding the date of petition, the access line being assessed was not used to access Utah intrastate telecommunications services.

(6)(a) An exemption granted under Subsection R746-360-4(5) is valid for a period of one calendar year from the date of issuance.

(b) Following the expiration of an exemption, and upon notice from the Commission, the end-user's provider shall assess the surcharge each month, until such time as the provider is notified by the Commission that a renewed exemption has been granted.

(c) Any assessment remitted to the Commission between the expiration of an exemption and the approval of a petition for renewal of the exemption shall be non-refundable.

(d)(i) The end-user shall bear the sole responsibility to know the expiration date of an exemption granted to the end-user and to ensure that an application for renewal is filed at least 30 days prior to the date of expiration.

(ii) At any proceeding to review a petition for renewal of an exemption, evidence that the end-user was unaware of the expiration date shall be inadmissible.

(iii) A petition for renewal of an exemption is deemed granted unless the Commission issues an order of denial within 30 days of the date on which the petition is filed.

 

KEY: affordable base rate, public utilities, telecommunications, universal service fund

Date of Enactment or Last Substantive Amendment: [October 24, 2016]2017

Notice of Continuation: November 13, 2013

Authorizing, and Implemented or Interpreted Law: 54-3-1; 54-4-1; 54-8b-15[(8)]

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