Preproposal statement of inquiry was filed as WSR 98-09-033.

Title of Rule: Method of setting rates for Washington telephone assistance program.

Purpose: Change from rule making to order the means by which the commission sets the rates paid by Washington state customers to support this program.

Statutory Authority for Adoption: RCW 80.01.040, 80.04.160, 80.36.440.

Summary: Revises WAC 480-122-020 and 480-122-070 to change the Washington telephone assistance program process from rule making to order.

Reasons Supporting Proposal: The Federal Communications Commission has jurisdiction over matching and nonmatching support funding through the lifeline program. The Department of Social and Health Services is responsible for administering the program in Washington state. The Washington Utilities and Transportation Commission is authorized to regulate telecommunications companies. Changes to the federal and state low income support programs require speedy changes to assure that funds are generated, used, and properly credited for low income support in a way that allows programs continuity.

Name of Agency Personnel Responsible for Drafting: Rebecca Beaton, 1300 South Evergreen Park Drive S.W., Olympia, WA 98504, (360) 664-1287; Implementation and Enforcement: Carole Washburn, Secretary, 1300 South Evergreen Park Drive S.W., Olympia, WA 98504, (360) 664-1174.

Name of Proponent: Washington Utilities and Transportation Commission, governmental.

Rule is not necessitated by federal law, federal or state court decision.

Explanation of Rule, its Purpose, and Anticipated Effects: On May 8, 1997, the Federal Communications Commission (FCC) issued its Report and Order, FCC Order No. 97-157 (FCC Order) implementing key portions of Section 254 of the Telecommunications Act of 1996 (the federal act), which addresses universal service. Among other matters a revised lifeline program was made available to all states with matching support funds. This rule changes from rule making to order the means by which the commission sets the rate paid by Washington state customers to support this program. Due to the dynamic nature of the program and the federal and state support mechanisms, the method of revising the client base must be flexible to assure continued universal service discounts are passed through to clients without delay as they become available.

Proposal Changes the Following Existing Rules: Amendment of WAC 480-122-020 and 480-122-070 so the commission may set by order the telephone assistance rate paid by customers to support the program.

No small business economic impact statement has been prepared under chapter 19.85 RCW. There is no fiscal impact, these administrative revisions change the method by which the commission effects the rate, but not the results.

RCW 34.05.328 does not apply to this rule adoption. The commission is not an agency to which RCW 34.05.328 applies.

Hearing Location: Commission Hearing Room, Chandler Plaza, Second Floor, 1300 South Evergreen Park Drive S.W., Olympia, WA 98504, on July 8, 1998, at 9:30 a.m.

Assistance for Persons with Disabilities: Contact Pat Valentine by July 1, 1998, TDD (360) 586-8203, or (360) 664-1133.

Submit Written Comments to: Carole Washburn, Secretary, P.O. Box 47250, Olympia, WA 98504-7250, FAX (360) 586-1150, by June 24, 1998.

Date of Intended Adoption: July 8, 1998.

June 1, 1998

Terrence Stapleton

for Paul Curl

Acting Secretary

AMENDATORY SECTION (Amending Order R-328, Docket No. UT-900462, filed 9/11/90, effective 10/12/90)

WAC 480-122-020  Washington telephone assistance program rate. The commission shall set by order the telephone assistance rate ((is eight dollars per month)).

[Statutory Authority: RCW 80.01.040. 90-19-020 (Order R-328, Docket No. UT-900462), § 480-122-020, filed 9/11/90, effective 10/12/90; 87-20-043 (Order R-277, Cause No. U-87-1102-R), § 480-122-020, filed 10/1/87.]

AMENDATORY SECTION (Amending Order R-328, Docket No. UT-900462, filed 9/11/90, effective 10/12/90)

WAC 480-122-070  Recovery of costs. Local exchange companies shall recover to the maximum extent possible by a waiver of all or part of the federal end user access charge and, to the extent necessary, from the telephone assistance fund administered by the department the following amounts:

(1) The difference between the telephone assistance rate ((specified in)) set by the commission by order under WAC 480-122-020 and the lowest available local exchange service flat rate, as specified in WAC 480-122-010 (3)(c);

(2) The discounted portion of the service connection fees;

(3) Applicable taxes not billed to the subscriber;

(4) Net uncollectibles directly resulting from the waiver of local exchange service deposits for eligible subscribers, provided that any partial payment collected for disconnected accounts shall be applied first to the payment of the local service bill; with the total for any account not to exceed two times the telephone assistance rate; and

(5) Administrative and program expenses incurred in offering the telephone assistance program, as authorized by the department.

[Statutory Authority: RCW 80.01.040. 90-19-020 (Order R-328, Docket No. UT-900462), § 480-122-070, filed 9/11/90, effective 10/12/90; 87-20-043 (Order R-277, Cause No. U-87-1102-R), § 480-122-070, filed 10/1/87.]