Goto Section: 51.907 | 51.911 | Table of Contents

FCC 51.909
Revised as of January 14, 2021
Goto Year:2020 | 2022
  §  51.909   Transition of rate-of-return carrier access charges.

   Link to an amendment published at  85 FR 75917 , Nov. 27, 2020.

   (a) Notwithstanding any other provision of the Commission's rules, on
   December 29, 2011, a Rate-of-Return Carrier shall:

   (1) Cap the rates for all rate elements for services contained in the
   definitions of End Office Access Service, Tandem Switched Transport
   Access Service, and Dedicated Transport Access Service, as well as all
   other interstate switched access rate elements, in its interstate
   switched access tariffs at the rate that was in effect on the December
   29, 2011; and

   (2) Cap, in accordance with § 51.505(b)(2), the rates for rate all
   elements in its intrastate switched access tariffs associated with the
   provision of terminating End Office Access Service and terminating
   Tandem-Switched Transport Access Service at the rates that were in
   effect on the December 29, 2011,

   (i) Using the terminating rates if specifically identified; or

   (ii) Using the rate for the applicable rate element if the tariff does
   not distinguish between originating and terminating.

   (3) Except as provided in paragraphs (a)(6) and (b)(4) of this section,
   nothing in this section obligates or allows a Rate-of-Return Carrier
   that has intrastate rates lower than its functionally equivalent
   interstate rates to make any intrastate tariff filing or intrastate
   tariff revisions raising such rates.

   (4) Notwithstanding the requirements of paragraph (a)(1) of this
   section, if a Rate-of-Return Carrier enters or exits the National
   Exchange Carrier Association (Association), as defined in § 69.2(d) of
   this chapter, traffic-sensitive tariff pursuant to the provisions of
   § 69.3(e)(6) of this chapter, the Association shall adjust its switched
   access rate caps referenced in paragraph (a)(1) of this section.

   (i) For each entering Rate-of-Return Carrier, the Association shall:

   (A) Determine each entering Rate-of-Return Carrier's interstate
   switched access revenues for the preceding calendar year;

   (B) Determine the revenues that would have been realized by the
   entering Rate-of-Return Carrier in the preceding calendar year if it
   had used the Association's switched access rates (employing the rates
   for the appropriate bands) as of December 31 of the preceding year and
   the entering Rate-of-Return Carrier's switched access demand used to
   determine switched access revenues under paragraph (a)(4)(i)(A) of this
   section; and

   (C) Subtract the sum of the revenues determined pursuant to paragraph
   (a)(4)(i)(B) of this section from the sum of the revenues determined
   pursuant to paragraph (a)(4)(i)(A) of this section.

   (ii) The Association shall determine the amount by which each exiting
   Rate-of-Return Carrier is a net contributor or net recipient to or from
   the switched access segment of the Association pool as follows:

   (A) The Association shall calculate the difference between each exiting
   Rate-of-Return Carrier's 2011-2012 tariff year projected interstate
   switched access revenues excluding Local Switching Support and the
   Rate-of-Return Carrier's projected switched access pool settlements
   excluding Local Switching Support for the same period with a net
   contribution amount being treated as a positive amount and a net
   recipient amount being treated as a negative amount. The Association
   shall divide the calculated difference by the Rate-of-Return Carrier's
   2011-2012 tariff year projected interstate switched access revenues
   excluding Local Switching Support to produce a percent net contribution
   or net receipt factor.

   (B) The Association shall multiply the factor calculated in paragraph
   (a)(4)(ii)(A) of this section by the Rate-of-Return Carrier's switched
   access revenues for the preceding calendar year to yield the amount of
   the Rate-of-Return Carrier's net contribution or net receipts for the
   calendar year.

   (iii) To determine the Association's adjusted switched access rate
   caps, the Association shall:

   (A) Add the amounts calculated under paragraphs (a)(4)(i) and
   (a)(4)(ii) of this section;

   (B) Divide the amount determined in paragraph (a)(4)(iii)(A) of this
   section by the preceding year's switched access revenues of the
   Rate-of-Return Carriers that will participate in the Association
   traffic-sensitive tariff for the next annual tariff period;

   (C) The Association shall proportionately adjust its June 30 switched
   access rate caps by the percentage amount determined in paragraph
   (a)(4)(iii)(B) of this section.

   (iv) The interstate switched access rate caps determined pursuant to
   paragraph (a)(4)(iii)(C) of this section shall be the new capped
   interstate switched access rates for purposes of § 51.909(a). The
   Association shall provide support in its annual access tariff filing to
   justify the revised interstate switched access rate caps, the Access
   Recovery Charges that will be assessed, and the amount of Connect
   America Fund ICC support each carrier will be eligible to receive.

   (5) A Rate-of-Return Carrier exiting the Association traffic-sensitive
   tariff pursuant to § 69.3(e)(6) of this chapter must establish new
   switched access rate caps as follows:

   (i) The Rate-of-Return Carrier shall multiply the factor determined in
   paragraph (a)(4)(ii)(A) of this section by negative one and then
   proportionately adjust the Association's capped switched access rates
   as of the date preceding the effective date of the exiting
   Rate-of-Return Carrier's next annual tariff filing by this percentage.
   A Rate-of-Return Carrier that was a net contributor to the pool will
   have rate caps that are lower than the Association's switched access
   rate caps, while a net recipient will have switched access rate caps
   that are higher than the Association's switched access rate caps;

   (ii) The interstate switched access rate caps determined pursuant to
   paragraph (a)(5)(i) of this section shall be the new capped interstate
   switched access rates of the exiting Rate-of-Return Carrier for
   purposes of § 51.909(a). An exiting Rate-of-Return Carrier shall provide
   support in its annual access tariff filing to justify the revised
   interstate switched access rate caps, the Access Recovery Charges that
   will be assessed, and the amount of Connect America Fund ICC support
   the carrier will be eligible to receive.

   (6) If the Association revises its interstate switched access rate caps
   pursuant to paragraph (a)(4) of this section, each Rate-of-Return
   Carrier participating in the upcoming annual Association
   traffic-sensitive tariff shall:

   (i) Revise any of its intrastate switched access rates that would have
   reached parity with its interstate switched access rates in 2013 to
   parity with the revised interstate switched access rate levels;

   (ii) The Association shall provide Rate-of-Return Carriers that are
   participating in the Association traffic-sensitive pool with notice of
   any revisions the Association proposes under paragraph (a)(4) of this
   section no later than May 1.

   (b) Step 1. Beginning July 1, 2012, notwithstanding any other provision
   of the Commission's rules:

   (1) Each Rate-of-Return Carrier shall file intrastate access tariff
   provisions, in accordance with § 51.505(b)(2), that set forth the rates
   applicable to Transitional Intrastate Access Service in each state in
   which it provides Transitional Intrastate Access Service.

   (2) Each Rate-of-Return Carrier shall establish the rates for
   Transitional Intrastate Access Service using the following methodology:

   (i) Calculate total revenue from Transitional Intrastate Access Service
   at the carrier's interstate access rates in effect on December 29,
   2011, using Fiscal Year 2011 intrastate switched access demand for each
   rate element.

   (ii) Calculate total revenue from Transitional Intrastate Access
   Service at the carrier's intrastate access rates in effect on December
   29, 2011, using Fiscal Year 2011 intrastate switched access demand for
   each rate element.

   (iii) Calculate the Step 1 Access Revenue Reduction. The Step 1 Access
   Revenue Reduction is equal to one-half of the difference between the
   amount calculated in (b)(2)(i) of this section and the amount
   calculated in (b)(2)(ii) of this section.

   (iv) A Rate-of-Return Carrier may elect to establish rates for
   Transitional Intrastate Access Service using its intrastate access rate
   structure. Carriers using this option shall establish rates for
   Transitional Intrastate Access Service such that Transitional
   Intrastate Access Service revenue at the proposed rates is no greater
   than Transitional Intrastate Access Service revenue at the intrastate
   rates in effect as of December 29, 2011 less the Step 1 Access Revenue
   Reduction, using Fiscal Year 2011 intrastate switched access demand.
   Carriers electing to establish rates for Transitional Intrastate Access
   Service in this manner shall notify the appropriate state regulatory
   authority of their election in the filing required by § 51.907(b)(1).

   (v) A Rate-of-Return Carrier may elect to apply its interstate access
   rate structure and interstate rates to Transitional Intrastate Access
   Service. In addition to applicable interstate access rates, the carrier
   may, between July 1, 2012 and July 1, 2013, assess a transitional
   per-minute charge on Transitional Intrastate Access Service end office
   switching minutes (previously billed as intrastate access). The
   transitional per-minute charge shall be no greater than the Step 1
   Access Revenue Reduction divided by Fiscal Year 2011 Transitional
   Intrastate Access Service end office switching minutes. Carriers
   electing to establish rates for Transitional Intrastate Access Service
   in this manner shall notify the appropriate state regulatory authority
   of their election in the filing required by § 51.907(b)(1).

   (3) Except as provided in paragraph (b)(4) of this section, nothing in
   this section obligates or allows a Rate-of-Return carrier that has
   intrastate rates lower than its functionally equivalent interstate
   rates to make any intrastate tariff filing or intrastate tariff
   revisions raising such rates.

   (4) If a Rate-of-Return Carrier must make an intrastate switched access
   rate reduction pursuant to paragraph (b)(2) of this section, and that
   Rate-of-Return Carrier has an intrastate rate for a rate element that
   is below the comparable interstate rate for that element, the
   Rate-of-Return Carrier shall:

   (i) Increase the rate for any intrastate rate element that is below the
   comparable interstate rate for that element to the interstate rate no
   later than July 1, 2013;

   (ii) Include any increases made pursuant to paragraph (b)(4)(i) of this
   section in the calculation of its eligible recovery for 2012.

   (c) Step 2. Beginning July 1, 2013, notwithstanding any other provision
   of the Commission's rules:

   (1) Transitional Intrastate Access Service rates shall be no higher
   than the Rate-of-Return Carrier's interstate Terminating End Office
   Access Service, Terminating Tandem-Switched Transport Access Service,
   and Originating and Terminating Dedicated Transport Access Service
   rates and subject to the same rate structure and all subsequent rate
   and rate structure modifications. Except as provided in paragraph
   (c)(2) of this section, nothing in this section obligates or allows a
   Rate-of-Return Carrier that has intrastate rates lower than its
   functionally equivalent interstate rates to make any intrastate tariff
   filing or intrastate tariff revisions to increase such rates.

   (2) If a Rate-of-Return Carrier made an intrastate switched access rate
   reduction in 2012 pursuant to paragraph (b)(2) of this section, and
   that Rate-of-Return Carrier has an intrastate rate for a rate element
   that is below the comparable interstate rate for that element, the
   Rate-of-Return Carrier shall:

   (i) Increase any intrastate rate element that is below the comparable
   interstate rate to the interstate rate by July 1, 2013; and

   (ii) Include any increases made pursuant to paragraph (c)(2)(i) of this
   section in the calculation of its eligible recovery for 2013.

   (d) Step 3. Beginning July 1, 2014, notwithstanding any other provision
   of the Commission's rules:

   (1) Notwithstanding the rate structure rules set forth in § 69.106 of
   this chapter or anything else in the Commission's rules, a
   Rate-of-Return Carrier shall establish separate originating and
   terminating interstate and intrastate rate elements for all components
   within interstate End Office Access Service. For fixed charges, the
   Rate-of-Return Carrier shall divide the amount based on relative
   originating and terminating end office switching minutes. If sufficient
   originating and terminating end office switching minute data is not
   available, the carrier shall divide such charges equally between
   originating and terminating elements.

   (2) Nothing in this Step shall affect Tandem-Switched Transport Access
   Service or Dedicated Transport Access Service.

   (3) Each Rate-of-Return Carrier shall establish rates for interstate
   and intrastate terminating End Office Access Service using the
   following methodology:

   (i) Each Rate-of-Return Carrier shall calculate the 2011 Baseline
   Composite Terminating End Office Access Rate. The 2011 Baseline
   Composite Terminating End Office Access Rate means the Composite
   Terminating End Office Access Rate calculated using Fiscal Year 2011
   interstate demand and the interstate End Office Access Service rates at
   the levels in effect on December 29, 2011.

   (ii) Each Rate-of-Return Carrier shall calculate its 2014 Target
   Composite Terminating End Office Access Rate. The 2014 Target Composite
   Terminating End Office Access Rate means $0.005 per minute plus
   two-thirds of any difference between the 2011 Baseline Composite
   Terminating End Office Access Rate and $0.005 per minute.

   (iii) Beginning July 1, 2014, no Rate-of-Return Carrier's interstate
   Composite Terminating End Office Access Rate shall exceed its 2014
   Target Composite Terminating End Office Access Rate. A rate-of-return
   carrier shall determine compliance by calculating interstate Composite
   Terminating End Office Access Rates using the relevant projected
   interstate demand for the tariff period multiplied by the respective
   interstate rates as of July 1, 2014, and then dividing by the projected
   interstate terminating end office local switching demand for the tariff
   period. A rate-of-return carrier's intrastate terminating end office
   access rates may not exceed the comparable interstate terminating end
   office access rates. In the alternative, any Rate-of-Return Carrier may
   elect to implement a single per minute rate element for both interstate
   and intrastate terminating End Office Access Service no greater than
   the 2014 Target Composite Terminating End Office Access Rate if its
   intrastate terminating end office access rates would be at rate parity
   with its interstate terminating end office access rates.

   (4) Nothing in this section obligates or allows a Rate-of-Return
   Carrier that has intrastate rates lower than its functionally
   equivalent interstate rates to make any intrastate tariff filing or
   intrastate tariff revisions raising such rates.

   (e) Step 4. Beginning July 1, 2015, notwithstanding any other provision
   of the Commission's rules:

   (1) Each Rate-of-Return Carrier shall establish rates for interstate
   and intrastate terminating End Office Access Service using the
   following methodology:

   (i) Each Rate-of-Return Carrier shall calculate its 2015 Target
   Composite Terminating End Office Access Rate. The 2015 Target Composite
   Terminating End Office Access Rate means $0.005 per minute plus
   one-third of any difference between the 2011 Baseline Composite
   Terminating End Office Access Rate and $0.005 per minute.

   (ii) Beginning July 1, 2015, no Rate-of-Return Carrier's interstate
   Composite Terminating End Office Access Rate shall exceed its 2015
   Target Composite Terminating End Office Access Rate. A rate-of-return
   carrier shall determine compliance by calculating interstate Composite
   Terminating End Office Access Rates using the relevant projected
   interstate demand for the tariff period multiplied by the respective
   interstate rates as of July 1, 2015, and then dividing by the projected
   interstate terminating end office local switching demand for the tariff
   period. A rate-of-return carrier's intrastate terminating end office
   access rates may not exceed the comparable interstate terminating end
   office access rates. In the alternative, any Rate-of-Return Carrier may
   elect to implement a single per minute rate element for both interstate
   and intrastate terminating End Office Access Service no greater than
   the 2015 Target Composite Terminating End Office Access Rate if its
   intrastate terminating end office access rates would be at rate parity
   with its interstate terminating end office access rates. Nothing in
   this section obligates or allows a Rate-of-Return Carrier that has
   intrastate rates lower than its functionally equivalent interstate
   rates to make any intrastate tariff filing or intrastate tariff
   revisions raising such rates.

   (2) [Reserved]

   (f) Step 5. Beginning July 1, 2016, notwithstanding any other provision
   of the Commission's rules, each Rate-of-Return Carrier shall establish
   interstate terminating End Office Access Service rates such that its
   interstate Composite Terminating End Office Access Service rate does
   not exceed $0.005 per minute. A rate-of-return carrier shall determine
   compliance by calculating interstate Composite Terminating End Office
   Access Rates using the relevant projected interstate demand for the
   tariff period multiplied by the respective interstate rates as of July
   1, 2016, and then dividing by the projected interstate terminating end
   office local switching demand for the tariff period. A rate-of-return
   carrier's intrastate terminating end office access rates may not exceed
   the comparable interstate terminating end office access rates. In the
   alternative, any Rate-of-Return Carrier may elect to implement a single
   per minute rate element for both interstate and intrastate terminating
   End Office Access Service no greater than the 2016 Target Composite
   Terminating End Office Access Rate if its intrastate terminating end
   office access rates would be at rate parity with its interstate
   terminating end office access rates. Nothing in this section obligates
   or allows a Rate-of-Return Carrier that has intrastate rates lower than
   its functionally equivalent interstate rates to make any intrastate
   tariff filing or intrastate tariff revisions raising such rates.

   (g) Step 6. Beginning July 1, 2017, notwithstanding any other provision
   of the Commission's rules:

   (1) Each Rate-of-Return Carrier shall establish interstate and
   intrastate rates for terminating End Office Access Service using the
   following methodology:

   (i) Each Rate-of-Return Carrier shall calculate its 2017 Target
   Composite Terminating End Office Access Rate. The 2017 Target Composite
   Terminating End Office Access Rate means $0.0007 per minute plus
   two-thirds of any difference between that carrier's 2016 Target
   Composite Terminating End Office Access Rate and $0.0007 per minute.

   (ii) Beginning July 1, 2017, no Rate-of-Return Carrier's interstate
   Composite Terminating End Office Access Rate shall exceed its 2017
   Target Composite Terminating End Office Access Rate. A rate-of-return
   carrier shall determine compliance by calculating interstate Composite
   Terminating End Office Access Rates using the relevant projected
   interstate demand for the tariff period multiplied by the respective
   interstate rates as of July 1, 2017, and then dividing by the projected
   interstate terminating end office local switching demand for the tariff
   period. A rate-of-return carrier's intrastate terminating end office
   access rates may not exceed the comparable interstate terminating end
   office access rates. In the alternative, any Rate-of-Return Carrier may
   elect to implement a single per minute rate element for both interstate
   and intrastate terminating End Office Access Service no greater than
   the 2017 Target Composite Terminating End Office Access Rate if its
   intrastate terminating end office access rates would be at rate parity
   with its interstate terminating end office access rates. Nothing in
   this section obligates or allows a Rate-of-Return Carrier that has
   intrastate rates lower than its functionally equivalent interstate
   rates to make any intrastate tariff filing or intrastate tariff
   revisions raising such rates.

   (2) [Reserved]

   (h) Step 7. Beginning July 1, 2018, notwithstanding any other provision
   of the Commission's rules:

   (1) Each Rate-of-Return Carrier shall establish interstate and
   intrastate rates for terminating End Office Access Service using the
   following methodology:

   (i) Each Rate-of-Return Carrier shall calculate its 2018 Target
   Composite Terminating End Office Access Rate. The 2018 Target Composite
   Terminating End Office Access Rate means $0.0007 per minute plus
   one-third of any difference between that carrier's 2016 Target
   Composite Terminating End Office Access Rate and $0.0007 per minute.

   (ii) Beginning July 1, 2018, no Rate-of-Return Carrier's interstate
   Composite Terminating End Office Access Rate shall exceed its 2018
   Target Composite Terminating End Office Access Rate. A rate-of-return
   carrier shall determine compliance by calculating interstate Composite
   Terminating End Office Access Rates using the relevant projected
   interstate demand for the tariff period multiplied by the respective
   interstate rates as of July 1, 2018 and then dividing by the projected
   interstate terminating end office local switching demand for the tariff
   period. A rate-of-return carrier's intrastate terminating end office
   access rates may not exceed the comparable interstate terminating end
   office access rates. In the alternative, any Rate-of-Return Carrier may
   elect to implement a single per minute rate element for both interstate
   and intrastate terminating End Office Access Service no greater than
   the 2018 interstate Target Composite Terminating End Office Access Rate
   if its intrastate terminating end office access rates would be at rate
   parity with its interstate terminating end office access rates. Nothing
   in this section obligates or allows a Rate-of-Return Carrier that has
   intrastate rates lower than its functionally equivalent interstate
   rates to make any intrastate tariff filing or intrastate tariff
   revisions raising such rates.

   (2) [Reserved]

   (i) Step 8. Beginning July 1, 2019, notwithstanding any other provision
   of the Commission's rules, each Rate-of-Return Carrier shall establish
   interstate and intrastate rates for terminating End Office Access
   Service that do not exceed $0.0007 per minute.

   (j) Step 9. Beginning July 1, 2020, notwithstanding any other provision
   of the Commission's rules, each Rate-of-Return Carrier shall, in
   accordance with a bill-and-keep methodology, revise and refile its
   federal access tariffs and any state tariffs to remove any intercarrier
   charges for terminating End Office Access Service.

   (k) As set forth in FCC 11-161, states will facilitate implementation
   of changes to intrastate access rates to ensure compliance with the
   Order. Nothing in this section shall alter the authority of a state to
   monitor and oversee filing of intrastate tariffs.

   [ 76 FR 73856 , Nov. 29, 2011, as amended at  77 FR 48452 , Aug. 14, 2012;
    78 FR 26267 , May 6, 2013;  79 FR 28845 , May 20, 2014]

   


Goto Section: 51.907 | 51.911

Goto Year: 2020 | 2022
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