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SB-603 Small independent telephone corporations: rates.(2019-2020)

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Date Published: 08/12/2019 02:00 PM
SB603:v94#DOCUMENT

Amended  IN  Assembly  August 12, 2019
Amended  IN  Assembly  June 25, 2019
Amended  IN  Senate  May 17, 2019
Amended  IN  Senate  April 30, 2019
Amended  IN  Senate  March 28, 2019

CALIFORNIA LEGISLATURE— 2019–2020 REGULAR SESSION

Senate Bill
No. 603


Introduced by Senator Borgeas
(Coauthors: Senators Caballero, Grove, Hueso, Moorlach, and Nielsen)
(Coauthors: Assembly Members Fong, Gallagher, Mathis, Obernolte, and Patterson)

February 22, 2019


An act to add Section 275.7 to the Public Utilities Code, relating to telecommunications.


LEGISLATIVE COUNSEL'S DIGEST


SB 603, as amended, Borgeas. Small independent telephone corporations: rates.
Under existing law, the Public Utilities Commission has regulatory authority over public utilities, including telephone corporations. Existing law authorizes the commission to fix just and reasonable rates and charges for public utilities. Existing law requires the commission to exercise its regulatory authority to maintain the California High-Cost Fund-A program, until January 1, 2023, to provide universal service rate support to small independent telephone corporations, as defined, in furtherance of the state’s universal service commitment to the continued affordability and widespread availability of safe, reliable, high-quality communications services in rural areas of the state.
This bill would authorize a small independent telephone corporation to initiate a rate case through either an advice letter or application. If a rate case is initiated by an advice letter, the bill would require that the case be processed according to the commission’s rules governing advice letters, be completed within 10 months of its submission, and that any changes to the telephone corporation’s revenue requirements or rate design resulting from the commission’s disposition of the advice letter be implemented within 12 months of the advice letter’s submission. letters. If a rate case is initiated by application, the bill would require that the case be processed according to the commission’s rules governing formal proceedings, be completed within 12 months of its submission, and that any changes to the telephone corporation’s revenue requirements or rate design resulting from the commission’s disposition of the application be implemented within 14 months of the application’s submission. proceedings. The bill would authorize the commission, following review of a rate case advice letter, to require that it be resubmitted as an application, if the commission adopts a resolution within 120 days that includes specified factual findings.
Vote: MAJORITY   Appropriation: NO   Fiscal Committee: YES   Local Program: NO  

The people of the State of California do enact as follows:


SECTION 1.

 Section 275.7 is added to the Public Utilities Code, to read:

275.7.
 (a) For purposes of this section, “small independent telephone corporations” are rural incumbent local exchange carriers subject to commission regulation.
(b) A small independent telephone corporation may request adjustments to its revenue requirement or rate design by initiating a rate case before the commission.
(c) (1) A rate case may be initiated by a small independent telephone corporation through either an advice letter or application.
(2) A rate case submitted by an advice letter shall be processed according to the commission’s rules governing advice letters and completed within 10 months of its submission. The commission shall implement any changes to revenue requirement or rate design resulting from the commission’s disposition of an advice letter pursuant to this section within 12 months of the date the advice letter was submitted. letters.
(3) A rate case submitted by application shall be processed according to the commission’s rules governing formal proceedings and completed within 12 months of its submission. The commission shall implement any changes to revenue requirement or rate design resulting from the commission’s disposition of an application pursuant to this section within 14 months of the date the application was submitted. proceedings.
(d) Following review of an advice letter submitted pursuant to this section, the commission may require that the advice letter be resubmitted as an application if, based on the contents of the advice letter, the small independent telephone corporation’s proposal does both of the following:
(1) Seeks an increase to its revenue requirement that exceeds the inflation-adjusted value of its current commission-approved revenue requirement.
(2) Raises new or unusual issues of fact that necessitate a formal process.
(e) The commission shall not require that a rate case advice letter be resubmitted as an application unless, within 120 days of the submission date of the advice letter, the commission issues a resolution that includes factual findings sufficient to satisfy the requirements of subdivision (d). If the 120th day following submittal of a rate case advice letter falls on a weekend or holiday, issuance of the resolution on the following regular business day shall be deemed to be within 120 days.
(f) (1)If the commission requires that a rate case advice letter be resubmitted as an application, the small independent telephone corporation shall have at least 90 days from the date of the resolution to file its application. If the 90th day following issuance of the resolution falls on a weekend or holiday, the small independent telephone corporation shall have until at least the following regular business day to resubmit the advice letter as an application. All deadlines associated with the submission of rate cases shall be tolled and all procedural and substantive rights conferred by submitting the advice letter shall be preserved until at least 90 days following the date of the resolution ordering the resubmittal.

(2)Notwithstanding subdivision (c), for a resubmittal pursuant to subdivision (d), the commission’s deadline for completion of the rate case shall be 18 months from the submission of the original advice letter, provided that the small independent telephone corporation is entitled to interim rate relief in the amount of an inflationary adjustment to its current commission-approved revenue requirement. Interim rate relief shall be effective as of 12 months from the date of its advice letter, subject to true-up at the conclusion of the rate case. The final revenue requirement and rate design in the final decision in the rate case shall be made effective as of the date upon which interim rate relief was issued.

(g) For the purposes of this section, inflation shall be measured according to the United States Department of Commerce’s Gross Domestic Product-Chained Price Index.