By: King of Hemphill H.B. No. 3127
A BILL TO BE ENTITLED
AN ACT
relating to the authority of certain telecommunications providers
to commit to making infrastructure and network improvements in
exchange for support from the universal service fund.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Subtitle C, Title 2, Utilities Code, is amended
by adding Chapter 53A to read as follows:
CHAPTER 53A. RURAL ADVANCED PLAN FOR INFRASTRUCTURE DEPLOYMENT
Sec. 53A.001. POLICY. In accordance with the policy stated
in Section 51.001(g), considering the differences in the geographic
and economic challenges posed by providing basic local
telecommunications services and competitive and advanced
telecommunications services to rural areas as opposed to urban
areas, the benefits incident to those services, the status of
universal service in the rural areas of this state, state and
national initiatives for widespread deployment of broadband
services, and the telecommunications services network and
infrastructure advancements needed to make possible the future
deployment of an electric smart grid in rural areas, it is the
policy of this state to:
(1) upgrade and maintain the telecommunications
services infrastructure in rural areas of this state in an effort
to:
(A) provide to each resident of this state a
network capable of providing access to basic local
telecommunications services and advanced telecommunications
services so that a majority of residents in rural areas have the
option to use those services; and
(B) ensure that each resident has advanced
telecommunications services to maintain the role of this state as a
leader in commerce and education;
(2) ensure that the residents of rural areas have
access to a wide range of advanced telecommunications services and
other competitive benefits in a manner and at prices similar to the
access available to residents in urban areas;
(3) provide the necessary infrastructure in rural
areas to support access to an array of telecommunications, data,
and video services, economic development and educational
opportunities, and telemedicine applications;
(4) provide the required underlying primary network
infrastructure to support major state and national energy policy
initiatives established to create an electric smart grid that
requires the support of an advanced telecommunications services
network;
(5) provide incentives and flexibility similar to
programs available in urban areas for small incumbent local
exchange companies that serve rural areas to complete a basic local
and advanced telecommunications services infrastructure that will
support universal service; and
(6) promote economic stabilization and growth in rural
areas through basic local and advanced telecommunications services
networks.
Sec. 53A.002. DEFINITIONS. In this chapter:
(1) "Advanced telecommunications services" includes
high speed, switched, broadband telecommunications service that
enables users to originate and receive high quality voice, data,
graphics, and video telecommunications.
(2) "Community center" means an organized public or
private entity that provides a location for specialized groups or
the general public to meet for group activities involving
community, educational, patriotic, political, public information,
recreational, religious, or social functions. The term includes
recreational centers, senior centers, youth centers, and publicly
owned meeting facilities. The commission may by rule designate
additional types of facilities or entities as community centers.
(3) "Educational institution" has the meaning
assigned by Section 57.021.
(4) "Electing provider" means a small provider that
elects to be subject to the infrastructure commitment and
corresponding regulation under this chapter.
(5) "Emergency services facility" means a facility
from which a person, including a firefighter, paramedic, emergency
medical technician, police officer, sheriff, constable, or other
state or federal law enforcement representative, responds to
emergencies, including 9-1-1 calls.
(6) "Library" means:
(A) a public library or regional library system,
as defined by Section 441.122, Government Code;
(B) a library operated by an institution of
higher education or a school district; or
(C) a library operated by a nonprofit
corporation, as defined by Section 441.221, Government Code.
(7) "Private network services" means
telecommunications services, including basic local
telecommunications services, broadband services, customized
services, and packaged network services.
(8) "Small provider" means:
(A) an incumbent local exchange company or
cooperative that on September 1, 2013, together with all local
exchange companies affiliated with the company or cooperative on
that date, served 31,000 or fewer access lines in this state; or
(B) a company or cooperative that is a successor
to a company or cooperative described by Subparagraph (A).
(9) "Smart grid" means infrastructure required to
produce an advanced electric energy grid system under the state and
national policy initiatives under the Energy Independence and
Security Act of 2007 (42 U.S.C. Section 17001 et seq.).
(10) "Telemedicine center" means a facility that is
equipped to transmit, by video, data, or voice service, medical
information for the diagnosis or treatment of an illness or disease
and that is:
(A) owned or operated by a public or
not-for-profit hospital; or
(B) owned by a state-licensed health care
practitioner and operated on a nonprofit basis.
Sec. 53A.003. CHAPTER CONTROLS. To the extent this chapter
conflicts with Chapter 53, this chapter controls.
Sec. 53A.004. ELECTION. (a) A small provider that is not
an electing company under Chapter 58 or 59 as of September 1, 2013,
may elect to be subject to this chapter and make the corresponding
infrastructure commitment under this chapter by notifying the
commission in writing of the election.
(b) The notice must include the information required by
Section 56.034 and a statement that the provider agrees to fulfill
the infrastructure commitment prescribed by this chapter.
(c) A small provider may not revoke an election.
Sec. 53A.005. INFRASTRUCTURE COMMITMENT. (a) After the
date the commission receives notice of the small provider's
election under Section 53A.004, the electing provider shall:
(1) commit to make all reasonable efforts and
investments in this state necessary to improve or upgrade network
infrastructure in the manner described by this chapter;
(2) work to ensure that the electing provider's
network backbone interoffice facilities are capable of supporting
services that include, at a minimum, broadband speeds that are not
less than the minimum speeds required by the Federal Communications
Commission, voice services, video signal at a quality level
comparable to a television broadcast signal, and other reasonably
anticipated basic local or advanced telecommunications services
that may become available to the public in the future; and
(3) work to ensure that all new or upgraded local loops
that are the subject of an equitable request for service are capable
of supporting basic local and advanced telecommunications
services, including broadband service at a speed that is not less
than the minimum broadband speed required by the Federal
Communications Commission.
(b) To meet the requirements of this chapter, an electing
provider may use any technology capable of achieving the required
level of service capabilities. This includes both new construction
and upgrades to existing facilities.
Sec. 53A.006. EQUITABLE REQUESTS FOR SERVICE. (a) For the
purposes of this chapter, a request for service is considered an
equitable request for service only if provision of the requested
service by the electing provider receiving the request is
technologically and economically feasible, including the provision
of network extensions or upgrades necessary to support any services
the requesting entity is receiving at the time the request is made
and other reasonably anticipated basic local or advanced
telecommunications services that may become available to the public
in the future.
(b) An electing provider shall determine whether a request
for service is an equitable request. If the electing provider
determines that the request is not an equitable request, the
electing provider shall provide written notice of that
determination to the requesting person. The requesting person may
appeal to the commission a determination that a request for service
is not an equitable request.
(c) An electing provider may deny a request that is not an
equitable request. An infrastructure commitment associated with a
denied request is waived.
(d) If the electing provider or the commission determines
that a request for service is an equitable request, the electing
provider shall, regardless of technology used, work to ensure that
the provider meets the commitments prescribed by Section 53A.005.
Sec. 53A.007. PRIVATE NETWORK SERVICES FOR CERTAIN
ENTITIES. (a) An electing provider shall, after receiving an
equitable request for service under Section 53A.006, provide
private network services to:
(1) a community center;
(2) an educational institution;
(3) a library;
(4) a public or not-for-profit emergency services
facility;
(5) a telemedicine center; or
(6) a legally constituted consortium of entities
listed in this subsection.
(b) The electing provider shall provide the private network
services for the private and sole use of the receiving entity or
entities. The provider may provide the services jointly with a
facility that is used to provide another service to another
customer.
(c) The entities described by Subsection (a) are a special
class of customers for the purposes of the private network for
distance learning, telemedicine, and information-sharing uses.
(d) An electing provider may provide a private network
service under a customer-specific contract.
(e) The entities described by Subsection (a) warrant
preferred rate treatment. An electing provider shall provide
private network services to those entities at a reduced rate equal
to 65 percent of the amount owed under the customer-specific
contract or under the otherwise applicable tariffed rate after
applicable federal discounts are applied.
(f) On request of an electing provider, the commission shall
provide reimbursement through the universal service fund, in
addition to monthly support received under Section 56.034(d)(1) or
(2), for reduced rates for private network services for entities
described by Subsection (a). The amount of reimbursement shall be
equal to the difference between the electing provider's
customer-specific contract or otherwise applicable tariffed rate
for that service, and the reduced rate offered for that service
under this chapter.
Sec. 53A.008. WAIVER OF INFRASTRUCTURE COMMITMENT
REQUIREMENTS. (a) On the request of an electing provider, the
commission may waive an infrastructure commitment requirement
under Section 53A.005 or 53A.009 or a requirement under an
equitable request for service under Section 53A.006.
(b) The commission may grant a waiver in relation to an
equitable request for service under Section 53A.006 if the electing
provider demonstrates that the requested investment or service
places an undue burden on the universal service fund or the electing
provider.
(c) Before granting a waiver under Subsection (b), the
commission must consider the public benefits that would result from
the investment or service, the willingness and ability of the
requestor to pay a reasonable aid to construction charge, and the
allowance of additional universal service fund support to allow
timely completion of the request.
(d) The commission shall review a waiver granted under
Subsection (a) or (b) at least once every three years if the
corresponding requirement or the corresponding equitable request
for service remains pending. The commission may not extend a waiver
until the commission reviews the factors listed in Subsection (c),
the technical ability of the provider to meet the waived
requirement, and the effect of extending the waiver on the
universal service fund.
Sec. 53A.009. PLAN. (a) An electing provider shall develop
and implement a five-year infrastructure investment plan to
maintain and upgrade existing network facilities to ensure
connectivity capable of meeting the standards prescribed by this
chapter.
(b) The plan must include a description of the proposed
improvements or upgrades to the electing provider's network
throughout its service area that will help the provider meet
infrastructure commitments and customer needs.
(c) An electing provider who is subject to a requirement
under federal law to file a five-year plan is not required to create
an additional plan under this section.
Sec. 53A.010. PROGRESS AND ACCOUNTABILITY REPORT. (a) An
electing provider shall file annually with the commission a report
on the provider's progress toward fulfilling the provider's
infrastructure commitment.
(b) The report must include:
(1) the plan described by Section 53A.009 or the
provider's federally prescribed five-year plan;
(2) a description of the provider's progress on
implementing the plan, how the provider is using universal service
support funds to improve service quality, coverage, or capacity,
and an explanation detailing why improvements or targets for the
previous calendar year have not been met, including adjustments for
evolving standards;
(3) a summary of financial data for the previous
calendar year that includes total company data, including:
(A) plant-specific operations expenses;
(B) plant non-specific operations expenses;
(C) customer operations expenses;
(D) corporate operations expenses;
(E) depreciation and amortization expenses;
(F) other operating expenses;
(G) total telecom plant in service;
(H) total property held for future use; and
(I) total telecom plant under construction; and
(4) average network capacity and speed capabilities
available to customers.
(c) A report filed under this section is confidential and
not subject to disclosure under Chapter 552, Government Code.
(d) The commission shall monitor the progress of each
electing provider through the reports submitted under this section.
Sec. 53A.011. UNIVERSAL SERVICE FUND RECOVERY. (a) An
electing provider is eligible to receive support from the universal
service fund as provided by this chapter and Section 56.034.
(b) This chapter does not affect the eligibility of an
electing provider to receive support under Section 56.025.
SECTION 2. Section 56.021, Utilities Code, is amended to
read as follows:
Sec. 56.021. UNIVERSAL SERVICE FUND ESTABLISHED. The
commission shall adopt and enforce rules requiring local exchange
companies to establish a universal service fund to:
(1) assist telecommunications providers in providing
basic local telecommunications service at reasonable rates in high
cost rural areas under two plans:
(A) the Texas High Cost Universal Service Plan
(16 T.A.C. Section 26.403); and
(B) the Small and Rural Incumbent Local Exchange
Company Universal Service Plan (16 T.A.C. Section 26.404);
(2) reimburse the telecommunications carrier that
provides the statewide telecommunications relay access service
under Subchapter D;
(3) finance the specialized telecommunications
assistance program established under Subchapter E;
(4) reimburse the department and the commission for
costs incurred in implementing this chapter and Chapter 57;
(5) reimburse a telecommunications carrier providing
lifeline service as provided by 47 C.F.R. Part 54, Subpart E, as
amended;
(6) finance the implementation and administration of
an integrated eligibility process created under Section 17.007 for
customer service discounts relating to telecommunications
services, including outreach expenses the commission determines
are reasonable and necessary;
(7) reimburse a designated provider under Subchapter
F;
(8) reimburse a successor utility under Subchapter G;
[and]
(9) finance the program established under Subchapter
H; and
(10) assist telecommunications providers that are
small and rural local exchange companies in providing basic local
and advanced telecommunications services in high cost rural areas
through fulfilling infrastructure commitments under Chapter 53A,
as provided by Section 56.034.
SECTION 3. Subchapter B, Chapter 56, Utilities Code, is
amended by adding Section 56.034 to read as follows:
Sec. 56.034. SUPPORT FOR RURAL ADVANCED PLAN FOR
INFRASTRUCTURE DEPLOYMENT. (a) Support for the Rural Advanced Plan
for Infrastructure Deployment is available to telecommunications
providers who are electing providers under Chapter 53A.
(b) Not later than January 1, 2017, the commission shall
implement a mechanism for electing providers to transition support
from the Small and Rural Incumbent Local Exchange Company Universal
Service Plan to the Rural Advanced Plan for Infrastructure
Deployment. Until the mechanism is in place, an electing
provider's support level may not be decreased from the level the
provider receives on the date the commission receives notice under
Section 53A.004 of the provider's election.
(c) When a provider notifies the commission that it elects
to be subject to Chapter 53A, the provider shall request that the
commission determine and disburse support to the provider under
Subsection (d)(1) or (d)(2).
(d) An electing provider may request that the commission
disburse funds to the provider in fixed monthly amounts based on:
(1) the company's annualized amount of recovery from
the universal service fund for the fiscal year ending on August 31,
2017, but only if the commission receives notice under Section
53A.004 of the provider's election on or before September 1, 2017;
or
(2) an annualized support amount determined to be
sufficient, based on the Federal Communications Commission cost
study and independently audited financials of the provider for the
most recently ended fiscal year and when considered with other
revenues, to permit the company the opportunity to earn a
reasonable return in accordance with Section 53.051.
(e) The commission shall determine the initial support
level not later than the 60th day after the date the commission
receives the notice under Section 53A.004.
(f) An electing provider who requests to have the provider's
initial support level determined and disbursed under Subsection
(d)(1) may, not earlier than the first anniversary of the date of
the determination of initial support level, make a one-time request
to have the provider's fixed monthly support determined and
disbursed under Subsection (d)(2). Not later than the 60th day
after the date the commission receives a request under this
subsection, the commission shall recalculate the amount of the
electing provider's support as provided by Subsection (d)(2) and
the electing provider is considered to have made a request under
Subsection (d)(2) for the purposes of all future adjustments. This
subsection does not limit a provider's ability to make a request
under Subsection (g).
(g) Not earlier than the first anniversary of the date of
the determination of an initial support level the electing provider
will receive under Subsection (d), or after an election under
Subsection (f), the commission may, only for good cause and on its
own motion, or shall, on the written request of the provider,
initiate a proceeding to recalculate the annual support amount to
be used as the basis for the fixed monthly support amounts. The
commission shall base the recalculation under this subsection on an
annualized support amount determined to be sufficient, when
considered with other revenues, to permit the company the
opportunity to earn a reasonable return in accordance with Section
53.051. Except for good cause, the commission may not initiate a
proceeding to adjust a provider's support under this subsection
more frequently than once every three years.
(h) The commission shall adjust support disbursed under
Subsection (d)(2) automatically every three years using the
calculation prescribed by Subsection (d)(2). An adjustment
proceeding under this subsection must be completed in not more than
60 days.
SECTION 4. This Act takes effect September 1, 2015.