R746-8-401. Rate-of-Return Regulated Providers

  (1) A rate-of-return regulated provider is eligible for ongoing UUSF support pursuant to Utah Code Section 54-8b-15 if the provider:

  (a) is a carrier of last resort;

  (b) is in compliance with Commission orders and rules;

  (c) unless a petition brought pursuant to Subsection R746-8-401(2) is granted after adjudication, charges, at a minimum, $18 per access line;

  (d) offers Lifeline service on terms and conditions prescribed by the Commission;

  (e) operates as a facilities-based provider, not a reseller; and

  (f) in compliance with R746-8-401(3), demonstrates through an adjudicative proceeding that its costs as established in Utah Code Section 54-8b-15 exceed its revenues as established in Utah Code Section 54-8b-15.

  (2)(a) A rate-of-return regulated provider may petition the Commission to deviate from the affordable base rate set forth in Subsection R746-8-401(1)(c).

  (b) A rate-of-return regulated provider that files a petition to deviate from the affordable base rate shall:

  (i) demonstrate that the affordable base rate is not reasonable in the provider's designated support area; or

  (ii) impute income up to the affordable base rate in calculating the provider's UUSF disbursement.

  (3) The calculation of a rate-of-return regulated provider's ongoing UUSF distribution shall conform to the following standards:

  (a) The provider's state rate-of-return shall be equal to the weighted average cost of capital rate-of-return prescribed by the FCC for rate-of-return regulated carriers, as of the date of the provider's application for support, and as follows:

  (i) beginning July 1, 2016: 11.0%

  (ii) beginning July 1, 2017: 10.75%;

  (iii) beginning July 1, 2018: 10.5%;

  (iv) beginning July 1, 2019, 10.25%;

  (v) beginning July 1, 2020, 10.0%; and

  (vi) beginning July 1, 2021, 9.75%.

  (b) The provider's depreciation costs shall be calculated as established in Utah Code Section 54-8b-15.

  (4) Yearly following a change in the FCC rate-of-return, unless the provider files with the Commission a petition for review of its UUSF disbursement, the Division shall make a recommendation of whether each provider's monthly distribution should be adjusted according to:

  (a) the current FCC rate-of-return as set forth in R746-8-401(3)(a); and

  (b) the provider's financial information from its last Annual Report filed with the Commission.