0001| HOUSE BILL 194 | 0002| 43RD LEGISLATURE - STATE OF NEW MEXICO - SECOND SESSION, 1998 | 0003| INTRODUCED BY | 0004| BEN LUJAN | 0005| | 0006| | 0007| | 0008| FOR THE REVENUE STABILIZATION AND TAX POLICY COMMITTEE | 0009| | 0010| AN ACT | 0011| RELATING TO TELECOMMUNICATIONS; AMENDING THE NEW MEXICO | 0012| TELECOMMUNICATIONS ACT TO PROVIDE FOR AN ALTERNATIVE FORM OF | 0013| REGULATION OF TELECOMMUNICATIONS COMPANIES; FUNDING A STUDY OF | 0014| THE FEASIBILITY OF STATEWIDE EXTENDED AREA SERVICE AND A STUDY | 0015| OF WAYS TO INCREASE THE NUMBER OF NEW MEXICO HOUSEHOLDS WITH | 0016| TELEPHONE SERVICE; AMENDING AND ENACTING SECTIONS OF THE NMSA | 0017| 1978; MAKING AN APPROPRIATION; DECLARING AN EMERGENCY. | 0018| | 0019| BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO: | 0020| Section 1. A new section of the New Mexico | 0021| Telecommunications Act is enacted to read: | 0022| "[NEW MATERIAL] ADDITIONAL DEFINITIONS.--As used in the | 0023| New Mexico Telecommunications Act: | 0024| A. "basic local exchange service" means retail | 0025| local exchange service provided to an end-user customer | - 1 - 0001| consisting of one-party, voice-grade, touch-tone access | 0002| capable of originating and terminating two-way switched, | 0003| voice-grade telecommunications within a local exchange area, | 0004| including access to telephone relay systems, directory | 0005| assistance, a white page directory listing, interexchange | 0006| carriers and emergency services, including 911 and enhanced | 0007| 911; | 0008| B. "retail public telecommunications service" | 0009| means public telecommunications service provided to an end- | 0010| user customer for the customer's own use and not for resale; | 0011| C. "unbundled elements" means network elements | 0012| that the federal Telecommunications Act of 1996 defines and | 0013| requires certain telecommunications companies to unbundle and | 0014| provide at technically feasible points to requesting | 0015| telecommunications carriers as defined in that federal act; | 0016| and | 0017| D. "wholesale public telecommunications service" | 0018| means public telecommunications service, including the | 0019| provision of unbundled elements, provided by one | 0020| telecommunications company to another for resale or for the | 0021| other's use in providing public telecommunications service." | 0022| Section 2. A new section of the New Mexico | 0023| Telecommunications Act is enacted to read: | 0024| "[NEW MATERIAL] ALTERNATIVE FORM OF REGULATION-- | 0025| RESIDENTIAL RATE PRICE CAP.-- | - 2 - 0001| A. Subject to the requirements and limitations of | 0002| this section, a telecommunications company may file an | 0003| application with the commission for exclusion from rate-of- | 0004| return regulation and the rate-making procedures and | 0005| requirements otherwise provided by state statute. | 0006| B. As a prerequisite for approval of the | 0007| application, the applicant shall cap the price for residential | 0008| basic local exchange service at its level on the date the | 0009| application is filed. The price cap shall remain in place | 0010| until the later of two years after the date the application is | 0011| filed or January 1, 2001 and shall be strictly enforced. No | 0012| price increase for residential basic local exchange service | 0013| shall be allowed during the period the price cap is in effect, | 0014| except for increases authorized by the commission and | 0015| necessitated by state or federal law, rule or administrative | 0016| order; franchise fees; or universal service fund surcharges. | 0017| C. The application shall include a price | 0018| regulation plan prescribing procedures for establishing and | 0019| changing prices, terms and conditions for all retail public | 0020| telecommunications service, including new public | 0021| telecommunications service not previously introduced, in a | 0022| manner consistent with any rules adopted by the commission. | 0023| The procedures shall include streamlined requirements for the | 0024| commission's review and approval of increases in rates for | 0025| residential basic local exchange service after expiration of | - 3 - 0001| the price cap required by Subsection B of this section. | 0002| D. The commission shall approve the application | 0003| and price regulation plan if the requirements of this section | 0004| are satisfied. The commission shall review and complete | 0005| action on the application and price regulation plan within one | 0006| hundred twenty days after the date the application is filed. | 0007| If the commission does not act within that period, the | 0008| application and the price regulation plan shall be deemed | 0009| approved one hundred twenty days after the date the | 0010| application is filed. | 0011| E. The effective date of the price regulation plan | 0012| approved pursuant to this section for an incumbent local | 0013| exchange carrier shall be no sooner than January 1, 1999." | 0014| Section 3. A new section of the New Mexico | 0015| Telecommunications Act is enacted to read: | 0016| "[NEW MATERIAL] QUALITY OF SERVICE STANDARDS.-- | 0017| A. The commission may adopt rules establishing | 0018| minimum statewide service standards and enforcement mechanisms | 0019| applicable to the provision of wholesale and retail public | 0020| telecommunications service. Prior to issuing the standards, | 0021| the commission shall invite and consider comments and | 0022| information from all interested parties and, to the extent | 0023| possible, shall seek consensus on the scope and content of the | 0024| standards. | 0025| B. The minimum statewide service standards shall | - 4 - 0001| be based on the record before the commission; shall be | 0002| practical, reasonable and technologically neutral; and shall | 0003| apply such conditions and prerequisites to the purchaser as | 0004| may be reasonably necessary to enable the provider to satisfy | 0005| its obligations. Wholesale public telecommunications service | 0006| standards shall be imposed and applied in a mutual and | 0007| reciprocal manner. | 0008| C. The commission shall establish procedures to | 0009| monitor and enforce compliance with the standards, which shall | 0010| include procedures for the expedited hearing and resolution of | 0011| complaints within one hundred twenty days after filing the | 0012| complaint." | 0013| Section 4. Section 63-9A-5 NMSA 1978 (being Laws 1985, | 0014| Chapter 242, Section 5) is amended to read: | 0015| "63-9A-5. ~~[REGULATION BY COMMISSION]~~ DELEGATION OF | 0016| AUTHORITY.-- | 0017| A. Except as otherwise provided in the New | 0018| Mexico Telecommunications Act, each public telecommunications | 0019| service is declared to be affected with the public interest | 0020| and, as such, subject to the provisions of that act, including | 0021| the regulation thereof as ~~[hereinafter]~~ provided in that | 0022| act. | 0023| B. The commission shall have general and | 0024| exclusive power and jurisdiction to regulate every | 0025| telecommunications company with respect to its rates and | - 5 - 0001| service regulations for public telecommunications service in | 0002| accordance with the provisions and subject to the limitations | 0003| and reservations of the New Mexico Telecommunications Act. | 0004| The commission may do all things reasonably necessary and | 0005| appropriate to implement the provisions of the federal | 0006| Telecommunications Act of 1996 and to exercise the authority | 0007| and to perform the duties that the federal act provides may be | 0008| performed by a state commission. | 0009| C. Consistent with the New Mexico | 0010| Telecommunications Act and the federal Telecommunications Act | 0011| of 1996, the commission shall have full power and authority | 0012| to: | 0013| (1) hear and resolve complaints between and | 0014| among telecommunications companies and between customers and | 0015| telecommunications companies, including without limitation | 0016| those relating to service quality, interconnection, access to | 0017| ducts and rights of way, provision of unbundled elements, | 0018| tariffs for public telecommunications service and rates and | 0019| charges for all regulated services; and | 0020| (2) make and enforce rules to implement the | 0021| federal Telecommunications Act of 1996." | 0022| Section 5. Section 63-9A-8 NMSA 1978 (being Laws 1985, | 0023| Chapter 242, Section 8, as amended) is amended to read: | 0024| "63-9A-8. REGULATION OF RATES AND CHARGES.-- | 0025| A. In accordance with the policy established in | - 6 - 0001| the New Mexico Telecommunications Act, the commission shall, | 0002| by its own motion or upon petition by any interested party, | 0003| hold hearings to determine if any public telecommunications | 0004| service is subject to effective competition in the relevant | 0005| market area. When the commission has made a determination | 0006| that a service or part of a service is subject to effective | 0007| competition, the commission shall, consistent with the | 0008| purposes of the New Mexico Telecommunications Act, modify, | 0009| reduce or eliminate rules, regulations and other requirements | 0010| applicable to the provision of such service, including the | 0011| fixing and determining of specific rates, tariffs or fares for | 0012| the service. The commission's action may include the | 0013| detariffing of service or the establishment of minimum rates | 0014| which will cover the costs for the service. Such modification | 0015| shall be consistent with the maintenance of the availability | 0016| of access to local exchange service at affordable rates and | 0017| comparable message ~~[telecommunication]~~ telecommunications | 0018| service rates, as established by the commission, for | 0019| comparable markets or market areas, except that volume | 0020| discounts or other discounts based on reasonable business | 0021| purposes shall be permitted. Upon petition or request of an | 0022| affected telecommunications company, the commission, upon a | 0023| finding that the requirements of Subsection C of this section | 0024| are met, shall modify the same or similar regulatory | 0025| requirements for those providers of comparable public | - 7 - 0001| telecommunications service in the same relevant markets so | 0002| that there shall be parity of regulatory standards and | 0003| requirements for all such providers. | 0004| B. In determining whether a service is subject to | 0005| effective competition, the commission shall consider the | 0006| following: | 0007| (1) the extent to which services are | 0008| reasonably available from alternate providers in the relevant | 0009| market area; | 0010| (2) the ability of alternate providers to | 0011| make functionally equivalent or substitute services readily | 0012| available at competitive rates, terms and conditions; and | 0013| (3) existing economic or regulatory barriers. | 0014| C. No provider of public telecommunications | 0015| service may use current revenues earned or expenses incurred | 0016| in conjunction with any noncompetitive service to subsidize | 0017| competitive public telecommunications service. In order to | 0018| avoid cross-subsidization of competitive services by | 0019| noncompetitive telecommunications services, prices or rates | 0020| charged for a competitive telecommunications service shall | 0021| cover the cost for the provision of the service. In any | 0022| proceeding held pursuant to this section, the party providing | 0023| the service shall bear the burden of proving that the prices | 0024| charged for competitive telecommunications services cover | 0025| cost. | - 8 - 0001| D. The commission may, upon its own motion or on | 0002| the petition of an interested party and after notice to all | 0003| interested parties and customers and a hearing, reclassify any | 0004| service previously determined to be a competitive | 0005| telecommunications service if after a hearing the commission | 0006| finds that a service is not subject to effective competition. | 0007| E. Notwithstanding any provision of this section | 0008| to the contrary, each telecommunications company shall have | 0009| the same flexibility in marketing and pricing its services in | 0010| any relevant market area as any telecommunications company | 0011| with which it is competing in that area." | 0012| Section 6. APPROPRIATION.-- | 0013| A. Seventy-five thousand dollars ($75,000) is | 0014| appropriated from the general fund to the following agencies | 0015| for expenditure in fiscal year 1999 for the following | 0016| purposes: | 0017| (1) twenty-five thousand dollars ($25,000) to | 0018| the state corporation commission to conduct a study of the | 0019| feasibility of statewide extended area service and to report | 0020| its findings to the revenue stabilization and tax policy | 0021| committee for its consideration and recommendations, including | 0022| proposed legislation, to the first session of the forty-fourth | 0023| legislature; and | 0024| (2) fifty thousand dollars ($50,000) to the | 0025| legislative council service to conduct a study and develop | - 9 - 0001| legislation for the consideration of the revenue stabilization | 0002| and tax policy committee and any other appropriate interim | 0003| committee determining and providing for ways to increase the | 0004| number of New Mexico households with telephone service and to | 0005| make that service as affordable as possible, applying the | 0006| principles of competition and universal service funding. | 0007| B. Any unexpended or unencumbered balance | 0008| remaining from the appropriations in Subsection A of this | 0009| section at the end of fiscal year 1999 shall revert to the | 0010| general fund. | 0011| Section 7. EMERGENCY.--It is necessary for the public | 0012| peace, health and safety that this act take effect | 0013| immediately. | 0014| |