AN
ACT Relating to new procedures for alternative forms of regulation of
telecommunications companies; and amending RCW 80.36.135.
BE IT
ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:
Sec.
1. RCW
80.36.135 and 1995 c 110 s 5 are each amended to read as follows:
(1)
The legislature declares that:
(a)
Changes in technology and the structure of the telecommunications industry may
produce conditions under which traditional rate of return, rate base regulation
of telecommunications companies may not in all cases provide the most efficient
and effective means of achieving the public policy goals of this state as
declared in RCW 80.36.300, this section, and RCW 80.36.145. The commission
should be authorized to employ an alternative form of regulation if that
alternative is better suited to achieving those policy goals.
(b)
Because of the great diversity in the scope and type of services provided by
telecommunications companies, alternative regulatory arrangements that meet the
varying circumstances of different companies and their ratepayers may be desirable.
(2)
Subject to the conditions set forth in this chapter and RCW 80.04.130, the
commission may regulate telecommunications companies subject ((before July
23, 1989,)) to traditional rate of return, rate base regulation by
authorizing an alternative form of regulation. The commission may determine
the manner and extent of any alternative forms of regulation as may in the
public interest be appropriate. In addition to the public policy goals
declared in RCW 80.36.300, the commission shall consider, in determining the
appropriateness of any proposed alternative form of regulation, whether it
will:
(a)
((Reduce regulatory delay and costs;
(b)
Encourage innovation in services;
(c)
Promote efficiency;
(d)
Facilitate the broad dissemination of technological improvements to all classes
of ratepayers;
(e)
Enhance the ability of telecommunications companies to respond to competition;
(f)
Ensure that telecommunications companies do not have the opportunity to
exercise substantial market power absent effective competition or effective
regulatory constraints; and
(g)
Provide fair, just, and reasonable rates for all ratepayers.
The
commission shall make written findings of fact as to each of the above-stated
policy goals in ruling on any proposed alternative form of regulation)) Facilitate
the broad deployment of technological improvements and advanced
telecommunications services to underserved areas or underserved customer
classes;
(b)
Improve the efficiency of the regulatory process;
(c)
Preserve or enhance the development of effective competition and protect
against the exercise of market power during its development;
(d)
Preserve or enhance service quality and protect against the degradation of the
quality or availability of efficient telecommunications services;
(e)
Provide for rates and charges that are fair, just, reasonable, sufficient, and
not unduly discriminatory or preferential; and
(f)
Not unduly or unreasonably prejudice or disadvantage any particular customer
class.
(3)
A telecommunications company or companies subject to traditional rate of
return, rate base regulation may petition the commission to establish an
alternative form of regulation. The company or companies shall submit with the
petition a plan for an alternative form of regulation. The plan shall contain
a proposal for transition to the alternative form of regulation((. The
commission shall review and may modify or reject the proposed)) and the
proposed duration of the plan. The plan must also contain a proposal
for ensuring adequate carrier-to-carrier service quality, including service
quality standards or performance measures for interconnection, and appropriate
enforcement or remedial provisions in the event the company fails to meet
service quality standards or performance measures. The commission also may
initiate consideration of alternative forms of regulation for a company or
companies on its own motion. The commission ((may approve the plan or
modified plan and authorize its implementation, if it finds, after notice and
hearing, that the plan or modified plan:
(a)
Is in the public interest;
(b)
Is necessary to respond to such changes in technology and the structure of the
intrastate telecommunications industry as are in fact occurring;
(c)
Is better suited to achieving the policy goals set forth in RCW 80.36.300 and
this section than the traditional rate of return, rate base regulation;
(d)
Ensures that ratepayers will benefit from any efficiency gains and cost savings
arising out of the regulatory change and will afford ratepayers the opportunity
to benefit from improvements in productivity due to technological change;
(e)
Will not result in a degradation of the quality or availability of efficient
telecommunications services;
(f)
Will produce fair, just, and reasonable rates for telecommunications services;
and
(g)
Will not unduly or unreasonably prejudice or disadvantage any particular
customer class.)), after notice and hearing, shall issue an
order accepting, modifying, or rejecting the plan within nine months after the
petition or motion is filed, unless extended by the commission for good cause.
The commission shall order implementation of the alternative plan of regulation
unless it finds that, on balance, an alternative plan as proposed or modified
fails to meet the considerations stated in subsection (2) of this section.
(4)
Not later than sixty days from the entry of the commission's order, the company
or companies affected by the order may file with the commission an election not
to proceed with the alternative form of regulation as authorized by the
commission. ((If a company elects to appeal to the courts the final order
of the commission authorizing an alternative form of regulation, it shall not
change its election to proceed or not proceed after the appeal is concluded.
The pendency of a petition by a company for judicial review of the final order
shall not serve to extend the sixty-day period.))
(5)
The commission may waive such regulatory requirements under Title 80 RCW for a
telecommunications company subject to an alternative form of regulation as may
be appropriate to facilitate the implementation of this section((:
PROVIDED, That the commission may not grant the authority to price list
services except as provided in RCW 80.36.300 through 80.36.370, the regulatory
flexibility act, nor may it waive any statutory requirements or grants of legal
rights to any person contained in this chapter and chapter 80.04 RCW as
amended, except as otherwise expressly provided)). However, the
commission may not waive any grant of legal rights to any person contained in
this chapter and chapter 80.04 RCW. The commission may waive different
regulatory requirements for different companies or services if such different
treatment is in the public interest.
(6)
Upon petition by ((any person, or upon its own motion)) the company,
and after notice and hearing, the commission may rescind ((its approval
of)) or modify an alternative form of regulation ((if, after
notice and hearing, it finds that the conditions set forth in subsection (3) of
this section can no longer be satisfied. The commission or any person may file
a complaint alleging that the rates charged by a telecommunications company
under an alternative form of regulation are unfair, unjust, unreasonable,
unduly discriminatory, or are otherwise not consistent with the requirements of
chapter 101, Laws of 1989: PROVIDED, That the complainant shall bear the
burden of proving the allegations in the complaint)) in the manner
requested by the company.
(7)
The commission or any person may file a complaint under RCW 80.04.110 alleging
that a telecommunications company under an alternative form of regulation has
not complied with the terms and conditions set forth in the alternative form of
regulation. The complainant shall bear the burden of proving the allegations
in the complaint.
