2011 Vermont Code
Title 30 Public Service
Chapter 5 POWERS AND DUTIES OF DEPARTMENT OF PUBLIC SERVICE
§ 226b Incentive regulation of basic exchange telecommunications providers

§ 226b. Incentive regulation of basic exchange telecommunications providers

(a) Upon petition of a basic exchange telecommunications service provider, upon request of the department of public service, or on its own initiative, the public service board may approve alternative forms of regulation other than the traditional methods based upon cost of service, rate base and rate of return.

(b) As used in this section:

(1) "Alternative forms of regulation" include, but are not limited to, incentive regulation, earnings sharing, categorization of services for the purpose of pricing, price caps, price indexing formulae, ranges of authorized returns, detariffing and reduction or suspension of regulatory requirements.

(2) "Basic exchange telecommunications service" has the same meaning as under section 226a of this title.

(c) The board shall approve alternative forms of regulation only if it finds, after notice and hearing, that such regulation, in its entirety:

(1) promotes the general good of the state;

(2) is consistent with the state telecommunications purposes established under section 202c of this title;

(3) is consistent with the state telecommunications plan adopted by the department of public service under section 202d of this title, or there exists good cause to approve alternative forms of regulation notwithstanding this inconsistency;

(4) is consistent with the public's interests relating to appropriate quality telecommunications services;

(5) is consistent with the goal of protecting or promoting universal service to residential users of telecommunications;

(6) provides reasonable incentives for the creation of a modern telecommunications infrastructure and the appropriate implementation of new cost-effective technologies;

(7) reasonably supports economic development in the affected service territory;

(8) adequately protects consumer privacy interests;

(9) supports reasonable competition;

(10) includes adequate safeguards to insure that charges for noncompetitive services do not subsidize competitive services; and

(11) is just and reasonable and would not produce unjust discrimination between users of the public switched network in the pricing, quality, or availability of the network functions or services offered.

(d) Prior to approving, modifying, or renewing an alternative form of regulation with respect to a specific basic exchange telecommunications provider, the board shall establish, and may amend from time to time, standards and procedures by which the effectiveness of the alternative form of regulation can be determined.

(e) In reviewing a petition to approve alternative forms of regulation, the board shall follow procedures substantially similar to those contained in sections 225, 226 and 227 of this title, except that if the board has not acted on the petition within nine months after the board has ordered suspension and investigation, the petition shall be deemed granted. By rule, the board may prescribe the minimum contents of a filing under this section.

(f) Where a petition for alternative forms of regulation has been filed by the department or a basic exchange telecommunications service provider, and the board determines that the proposal does not satisfy the requirements of this section, it may either reject the proposal or issue a proposed order approving alternative regulation with such modifications as the board determines necessary to satisfy the requirements of this section. Within 20 days after issuance of a proposed order under this section, any party may submit comments and may offer to provide additional evidence concerning the proposed order. After review of such comments, and after conducting any additional hearings that the board determines to be necessary, the board shall issue a final order with such modifications as the board determines to be necessary to satisfy the requirements of this section. If the board determines that evidence offered by a party reasonably should have been introduced at hearings prior to the

proposed order, the board may exclude such evidence. The board shall issue its final order within 45 days after the proposed order is issued, or within 90 days after the proposed order is issued if further hearings have been held.

(g) Any final order approving or modifying alternative forms of regulation shall, by its terms, take effect not sooner than 30 days following its issuance.

(h) An order establishing an alternative form of regulation may include:

(1) exemption from or reduction of the requirements of subsection 218(a) and sections 225, 226, 227, and 229 of this title, including rate of return requirements;

(2) terms and conditions for establishing new services, withdrawing services, price changes to services, and services by contract to individual customers; and

(3) other rates, terms, and conditions that the board finds to be consistent with the general considerations and standards under subsections (c) and (d) of this section.

(i) While an order approving alternative forms of regulation is in effect, the department of public service and the public service board may conduct investigations into the effectiveness of the alternative forms of regulation, and whether a traditional form of regulation should be restored. Following notice and an opportunity for hearing, the public service board may terminate an order establishing an alternative form of regulation and restore a traditional form of regulation, or it may modify the order approving alternative forms of regulation.

(j) If at any time an order establishing an alternative form of regulation has been in effect for seven years without having been renewed, the order shall be deemed of no further force or effect and the waiver of statutory requirements under this title shall expire. All tariffs then in effect shall remain in effect until further order of the board.

(k) A basic exchange telecommunications service provider operating under an alternative form of regulation, the department of public service, or the public service board may initiate a proceeding to renew an order approving an alternative form of regulation. The provisions of this section shall apply to a proposed renewal of an alternative form of regulation. The board may issue orders approving, denying, or modifying the proposed renewal. In reviewing a proposed renewal of an alternative form of regulation, the board may consider the basic exchange telecommunications service provider's performance for the duration of the alternative form of regulation in effect at the time the renewal is initiated. Nothing in this section shall require the board to conduct cost of service, rate base, or rate of return analyses.

( l) The board shall have the discretionary authority to provide an expedited process under this section for a basic exchange telecommunications provider with less than 10 percent of the access lines in this state. The process shall include notice and opportunity for hearing and may include simplified procedures. Nothing in this section requires the board to conduct a cost of service, rate base, or rate of return analysis for such companies as a precondition to alternative regulation. (Added 1993, No. 84, { 1; amended 1995, No. 182 (Adj. Sess.), { 3, eff. May 22, 1996; 2003, No. 98 (Adj. Sess.), { 4.)