Senate Bill 2606

(As Passed the Senate)

AN ACT TO AMEND SECTION 77-3-35, MISSISSIPPI CODE OF 1972, TO PROVIDE THAT THE PUBLIC SERVICE COMMISSION MAY ONLY REGULATE THE RATES, TERMS AND CONDITIONS OF CERTAIN SWITCHED ACCESS SERVICES AND SINGLE-LINE FLAT RATE VOICE COMMUNICATION SERVICES; TO PROVIDE THAT AN INCUMBENT LOCAL EXCHANGE CARRIER SHALL PROVIDE PRIMARY SINGLE-LINE FLAT RATE VOICE COMMUNICATION SERVICE TO THE PREMISES OF A PERMANENT RESIDENCE OR BUSINESS WITHIN ITS FRANCHISED SERVICE TERRITORY, IF THE COST TO THE REQUESTING PARTY DOES NOT EXCEED A CERTAIN AMOUNT; TO PROVIDE THAT THE COMMISSION SHALL RETAIN EXCLUSIVE ORIGINAL JURISDICTION OVER CUSTOMER COMPLAINTS FOR THOSE SERVICES THAT CONTINUE TO BE REGULATED; TO PROVIDE THAT CERTAIN TELECOMMUNICATION UTILITIES SHALL ONLY BE REQUIRED TO FILE FINANCIAL OR SERVICE QUALITY INFORMATION THAT IS REQUIRED TO BE FILED WITH THE FEDERAL COMMUNICATIONS COMMISSION; AND FOR RELATED PURPOSES.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MISSISSIPPI:

SECTION 1. Section 77-3-35, Mississippi Code of 1972, is amended as follows:

77-3-35. (1) Subject to the provisions of subsections (2) and (4) of this section, under such reasonable rules and regulations as the commission may prescribe, every public utility, as to the rates * * * which are subject to regulation under the provisions of this article, shall file with the commission, within such time and in such form as the commission may designate, schedules showing such rates and charges established by it and collected and enforced, or to be collected or enforced within the jurisdiction of the commission. The utility shall keep copies of such schedules open to public inspection under such reasonable rules and regulations as the commission may prescribe.

No such public utility shall directly or indirectly, by any device whatsoever, or in anywise, charge, demand, collect or receive from any person or corporation for any service rendered or to be rendered by such public utility a greater or less compensation than that prescribed in the schedules of such public utility applicable thereto then filed in the manner provided in this section, and no person or corporation shall receive or accept any service from any such public utility for a compensation greater or less than prescribed in such schedules.

* * * Utilities selling commodities or rendering any service to cooperatives, municipalities or other nonprofit organizations, shall, at the order of the commission, file schedules of such rates and charges for information purposes only.

The commission may provide, by rules and regulations to be adopted by it, the following:

(a) That utilities may contract with a manufacturer that is not a utility for furnishing the services or commodities described in Section 77-3-3(d)(i), (ii) and (iii) for use in manufacturing;

(b) That utilities described in Section 77-3-3(d)(i) also may contract with a customer that has a minimum yearly electric consumption of two thousand five hundred (2,500) megawatt hours per year or greater for furnishing the services or commodities described in Section 77-3-3(d)(i); and

(c) That utilities described in Section 77-3-3(d)(ii) also may contract with a customer that has a minimum yearly consumption of eight million five hundred thousand (8,500,000) cubic feet of gas per year or greater for furnishing the services or commodities described in Section 77-3-3(d)(ii).

These contracts may be entered into without reference to the rates or other conditions which may be established or fixed pursuant to other provisions of this article. Such regulations shall provide that before becoming effective any such contract shall be approved by the commission.

(2) (a) The Legislature recognizes that the maintenance of universal telephone service in Mississippi is a continuing goal of the commission and that the public interest requires that the commission be authorized and encouraged to formulate and adopt rules and policies that will permit the commission, in the exercise of its expertise, to regulate and control the provision of telecommunications services to the public in a changing environment where competition and innovation are becoming more commonplace, giving due regard to the interests of consumers, the public, the providers of telecommunications services and the continued availability of good telecommunications service. The commission is authorized to issue more than one competing certificate of public convenience and necessity to provide local exchange telephone service in the same geographical area; provided, that the issuing of any such additional certificates shall not otherwise affect any certificate of public convenience and necessity heretofore issued to any provider of such services.

The commission shall adopt all rules and regulations necessary for implementing this subsection (2)(a).

The commission retains the authority to issue orders to implement its rules, regulations and the provisions of this chapter, including the authority to grant and modify, impose conditions upon, or revoke a certificate.

(b) * * * The commission may, on its own motion or at the request of any interested party, enter an order, after notice and opportunity for hearing, determining and directing that, in the provision of a service or facility by a utility of the type defined in Section 77-3-3(d)(iii), competition or other market forces adequately protect the public interest, or that a service or facility offered by the utility is discretionary, and that the public interest requires that the utility's rates and charges for such service or facility shall not thereafter be subject to regulation by the commission.

(c) In making its determination whether the rates and charges for a service or facility shall not be subject to regulation by the commission, the commission may consider individually or collectively:

(i) Whether the exercise of commission jurisdiction produces tangible benefits to the utility's customers that exceed those available by reliance on market forces or other factors;

(ii) Whether technological changes, competitive forces, discretionary nature of the service or facility, or regulation by other state and federal regulatory bodies render the exercise of jurisdiction by the Mississippi commission unnecessary or wasteful;

(iii) Whether the exercise of commission jurisdiction inhibits a regulated utility from competing with unregulated providers of functionally similar telecommunications services or equipment;

(iv) Whether the existence of competition tends to prevent abuses, unjust discrimination and extortion in the charges of telecommunications utilities for the service or facility in question;

(v) The availability of the service or facility from other persons and corporations; or

(vi) Any other factors that the commission considers relevant to the public interest.

In making the determination as above set forth, the commission may specify the period of time during which the utility's rates and charges for the service or facility shall not thereafter be subject to regulation. Likewise, after notice and opportunity for hearing, the commission may revoke a determination and direction made under this section, when the commission finds that commission regulation of the utility's rates and charges for the service or facility in question is necessary to protect the public interest.

(3) (a) * * * The commission is authorized to consider and adopt alternative methods of regulation proposed by a utility of the type defined in Section 77-3-3(d)(i), (ii) or (iii) to establish rates for the services furnished by such utility that are fair, just and reasonable to the public and that provide fair, just and reasonable compensation to the utility for such services.

(b) For purposes of this subsection, the phrase "alternative methods of regulation" means the regulation of utility rates and charges by methods other than the rate base or rate of return method of regulation set forth in other provisions of this article.

(4) (a) Notwithstanding any other provisions of this article or any other statute to the contrary, and consistent with the provisions herein, for those public utilities of the type defined in Section 77-3-3(d)(iii) that are subject to the competitive requirements set forth in 47 USC Section 251 or those public utilities that have waived a suspension granted by the commission of the requirements of 47 USC Section 251(b) and (c) as authorized by 47 USC Section 251(f)(2), the Legislature has determined that, in the provision of all services other than switched access service and single-line flat rate voice communication service, competition or other market forces adequately protect the public interest. Therefore, the commission is only authorized to regulate the rates, terms and conditions of switched access service and single-line flat rate voice communication service within a traditional local calling area, with access to 911, with touch tone dialing and with access to long distance, so long as such single-line flat rate service is not combined with any other service, feature or product. The retail rates for such single-line flat rate voice communication service beginning January 1, 2007, and every succeeding January 1 may only be increased during the calendar year by an amount that does not exceed the rates for such service on January 1 of the previous year, plus the increase in the Consumer Price Index for all Urban Consumers as reported by the U.S. Department of Labor, Bureau of Labor Statistics.

(b) For those public utilities of the type defined in Section 77-3-3(d)(iii) that have been granted a suspension by the commission of the requirements of 47 USC Section 251(b) and (c) as authorized by 47 USC Section 251(f)(2), the commission, at the request of such public utility, shall enter an order, after notice and opportunity for hearing, determining that such public utility's provision of service will be subject to the same level of regulation as provided in paragraph (a) of this subsection, but only after the commission determines that such public utility has satisfied one (1) of the following conditions:

(i) Has executed interconnection agreements which have been approved by the commission to the extent required under law with two (2) or more local exchange carriers unaffiliated with such public utility;

(ii) Offers for resale at wholesale rates, pursuant to 47 USC Section 251(c)(4)(A) and (B), such public utility's retail telecommunications services provided to subscribers who are not telecommunications carriers;

(iii) At least two (2) competitive telecommunications providers unaffiliated with such requesting public utility are offering service to such public utility's subscribers; or

(iv) Has experienced a material reduction in access lines or minutes of use in two (2) consecutive years.

A waiver of suspension under paragraph (a) of this subsection shall be effective upon written notification to the commission. The initial rate utilized by such public utility shall be the rate for such service in effect at the time of such waiver under this section. The commission, upon request of the public utility, may return such public utility to return to a form of regulation permitted under Section 77-3-35.

(c) (i) An incumbent local exchange carrier shall provide, upon reasonable request, primary single-line flat rate voice communication service to the premises of a permanent residence or business within its franchised service territory, if the costs, including, but not limited to, the costs of facilities, rights-of-way and equipment, of providing such service to the requesting party does not exceed Five Thousand Dollars ($5,000.00). This requirement shall not apply where there is an alternative provider of service to the premises of the residence or business customer, or where the incumbent local exchange carrier has been prohibited from providing service to the premises.

(ii) If the cost exceeds Five Thousand Dollars ($5,000.00), as provided in and subject to subparagraph (i) of this paragraph (c), an incumbent local exchange carrier may not deny service on the basis of cost so long as sufficient funds to provide that services are available from contributions to aid in construction or the Mississippi portion of the applicable federal universal service fund program as administered by the commission.

(d) Nothing in this chapter shall be construed to affect the duties of an incumbent local exchange carrier to provide unbundled access to network elements to the extent required under 47 USC Sections 251 and 252 and the Federal Communications Commission's regulations implementing these sections, or the commission's authority to arbitrate and enforce interconnection agreements pursuant to 47 USC Sections 251 and 252 and the Federal Communications Commission's regulations implementing these sections.

(e) The commission shall retain exclusive original jurisdiction over customer complaints for those services that continue to be regulated. For services no longer regulated, the commission shall have exclusive original jurisdiction to interpret and enforce the terms and conditions of customer service agreements for telecommunications services, but it shall not alter, set aside or refuse to enforce the rates, terms and conditions thereof, either directly or indirectly. No other party shall be allowed to participate in any such complaint proceeding, except for the customer, legal counsel or other representative of the customer, or the public utility involved.

(f) A public utility of the type defined in Section 77-3-3(d)(iii) which is regulated under the provisions of paragraph (a) of this subsection shall only be required to file financial or service quality information that such public utilities are required to file with the Federal Communications Commission so long as such financial information includes data specific to Mississippi. As to all other data and information, the requirements of Section 77-3-79 continue to apply. If any such public utility is not required to file such financial information with the Federal Communications Commission, the requirements of Section 77-3-79 continue to apply. The public utility regulatory tax established in Section 77-3-87 shall be based on the financial information contained in such federal financial reports filed by such public utilities. The calculation of such tax for such public utilities shall continue to be based upon the gross revenues from the intrastate operations of such public utility in the same manner as such tax was calculated before July 1, 2006. Nothing herein shall change the obligation of such public utilities described in Section 77-3-3(d)(iii) to pay the public utilities regulatory tax established in Section 77-3-87. In addition, such public utility shall only be required to adhere to billing for retail telecommunications services in compliance with the federal truth in billing regulations prescribed by the Federal Communications Commission.

(g) (i) In order to transition to the changes effectuated by paragraph (a) of this subsection, the rates, terms and conditions for products and services no longer subject to regulation by the commission which were in effect with a specific term immediately prior to the effective date of this section shall remain in effect for the duration of the specific term as to customers who subscribed to such products or services prior to the effective date of this section. If no term applied to such products or services at the time such customer subscribed to such products or services, then the rates, terms and conditions governing such products or services shall remain in effect until a written customer service agreement becomes effective as described in subparagraph (ii) of this paragraph (g).

(ii) Except as provided in subparagraph (i) of this paragraph (g), the service provider shall offer existing and new customers a written customer service agreement, which in the case of new customers shall be delivered no later than thirty (30) days after the initiation of service. The customer service agreement shall include a provision advising the customer that he has thirty (30) days from receipt in which to elect:

1. To terminate service with the service provider by contacting such service provider within the thirty-day time period, in which case the customer shall have the right to pay off the account in the same manner and under the same rates, terms and conditions as set forth in the written customer service agreement provided to the customer, which written customer service agreement shall relate back in its entirety to the date of a new customer's request for service or the date the agreement was sent to an existing customer, as applicable, and shall be in effect until termination through pay off; or

2. To use the services of the service provider or to otherwise continue the account with the service provider after the thirty-day time period has elapsed, either of which shall constitute the customer's assent to all the rates, terms and conditions of the written customer service agreement. The customer service agreement shall be deemed received three (3) business days after deposit in the U.S. mail, first-class delivery.

(iii) If any service provider desires to modify in any respect any rates, terms or conditions of a customer service agreement, it shall provide at least thirty (30) days' prior written notice of the modification and the proposed effective date to the customer. The customer service agreement shall include a provision advising the customer that he has the option:

1. To terminate service with the service provider by contacting such service provider prior to the effective date, in which case the customer shall have the right to pay off the account in the same manner and under the same rates, terms and conditions as then in effect; or

2. To use the services of the service provider or to otherwise continue the account with the service provider on or after the effective date, either of which shall constitute the customer's assent to the modified written customer service agreement. The customer service agreement shall be deemed received three (3) business days after deposit in the U.S. mail, first-class delivery.

(h) Nothing herein shall change the obligation of those public utilities described in Section 77-3-3(d)(iii) to obtain a certificate of public convenience and necessity pursuant to this chapter.

SECTION 2. This act shall take effect and be in force from and after July 1, 2006.