Common carrier services: Telecommunications Act of 1996; implementation— Local competition provisions; unbundled network elements; deaveraged rate zones; temporary stay,

[Federal Register: June 16, 1999 (Volume 64, Number 115)]

[Rules and Regulations]

[Page 32206-32207]

From the Federal Register Online via GPO Access [wais.access.gpo.gov]

[DOCID:fr16jn99-13]

FEDERAL COMMUNICATIONS COMMISSION

47 CFR Part 51

[CC Docket No. 96-98; FCC 99-86]

Implementation of the Local Competition Provisions of the Telecommunications Act of 1996; Deaveraged Rate Zones for Unbundled Network Elements

AGENCY: Federal Communications Commission.

ACTION: Final rule; temporary stay.

SUMMARY: In this Order, the Commission temporarily stays the effectiveness of its

[[Page 32207]]

rule requiring each state to establish at least three geographic rate zones for unbundled network elements and interconnection. The Commission issues the stay to afford the states an opportunity to bring their own rules into compliance with the Commission's rule, in light of the U.S. Supreme Court's recent decision in AT&T v. Iowa Utils. Bd.

DATES: Effective May 7, 1999, 47 CFR 51.507(f), published at 61 FR 45476 (August 29, 1996), is stayed indefinitely. The Commission will publish in the Federal Register at a later date the date that the stay expires.

ADDRESSES: The entire file is available for inspection and copying weekdays from 9:00 a.m. to 4:30 p.m. in the Commission's Reference Center, 445 Twelfth Street SW, Washington, DC 20554. Copies may be purchased from the Commission's duplicating contractor, ITS Inc., 1231 Twentieth St., NW, Washington, DC 20036, (202) 857-3800.

FOR FURTHER INFORMATION CONTACT: Neil Fried, Common Carrier Bureau, Competitive Pricing Division, (202) 418-1530; TTY: (202) 418-0484.

SUPPLEMENTARY INFORMATION: In the Local Competition Order, the Commission promulgated certain rules to implement section 251 of the Communications Act of 1934, as amended. 61 FR 45476; 11 FCC Rcd 15499 (1996). One such rule, section 51.507(f), requires each state commission to ``establish different rates for [interconnection and unbundled network elements] in at least three defined geographic areas within the state to reflect geographic cost differences.'' 47 CFR 51.507(f). The Commission released the Local Competition Order on August 8, 1996. A number of parties, including incumbent LECs and state commissions, appealed the order shortly thereafter. The U.S. Court of Appeals for the Eighth Circuit stayed the effectiveness of the section 251 pricing rules on September 27, 1996. Iowa Utils. Bd. v. FCC, 96 F.3d 1116 (8th Cir. 1996) (per curium) (temporarily staying the Local Competition Order until the filing of the court's order resolving the petitioners' motion for stay). See also Iowa Utils. Bd. v. FCC, 109 F.3d 418 (8th Cir.) (dissolving temporary stay and granting petitioners' motion for stay, pending a final decision on the merits of the appeal), motion to vacate stay denied, 117 S. Ct. 429 (1996). On July 18, 1997, the Court of Appeals vacated these rules, including Section 51.507(f) on deaveraging, on the grounds that the Commission lacked jurisdiction. Iowa Utils. v. FCC, 120 F.3d 753, 800 n.21, 819 n.39, 820 (8th Cir. 1997). On January 25, 1999, however, the U.S. Supreme Court reversed the Eighth Circuit's decision with regard to the Commission's section 251 pricing authority, and remanded the case to the Eighth Circuit for proceedings consistent with the Supreme Court's opinion. AT&T v. Iowa Utils. Bd., 119 S. Ct. 721, 733, 738 (1999).

In this Order, the Commission stays the effectiveness of section 51.507(f) until six months after the Commission issues its order in CC Docket No. 96-45 finalizing and ordering implementation of high-cost universal service support for non-rural LECs under section 254 of the Act. The six-month period shall run from the Commission's release of that order. Neither petitions for reconsideration nor appeals of that order shall have any bearing on the length of the stay.

The Commission found good cause to issue such a stay. See 47 CFR 1.3 (allowing the Commission to suspend its rules for good cause). Because of the Eighth Circuit's decisions, the section 251 pricing rules were not in effect for approximately two-and-a-half years. During that time, not all states established at least three deaveraged rate zones for unbundled network elements and interconnection. Some have taken no action yet regarding deaveraging; others have affirmatively decided to adopt less than three zones. A temporary stay will ameliorate the disruption that would otherwise occur, and will afford the states an opportunity to bring their rules into compliance with section 51.507(f).

A number of parties argued that the Commission made the appropriate policy decisions regarding deaveraging when it issued the Local Competition Order, and that implementation should not be further postponed. Some contended that it may be appropriate for the Commission to give states a reasonable amount of time to implement conforming rules, but argue that any ``significant'' delay is unwarranted. The Commission concluded that six months following the Commission's order in CC Docket No. 96-45 represents an appropriate length for the stay. State and federal regulators now have the benefit of not only a variety of court decisions, but also nearly three more years of experience and data. The stay will allow the states and the Commission a sufficient, but not excessive, amount of time to bring their rules into compliance in a manner coordinated with reform of universal service.

The Commission recognized the possibility that the three-zone rule may not be appropriate in all states. In some states, for instance, local circumstances may dictate the establishment of only two deaveraged rate zones. The Commission stated that it intends to address such situations on a case-by-case basis. States may file waiver requests with the Commission seeking relief from the general rule in light of their particular facts and circumstances. See 47 CFR 1.3 (allowing the Commission to waive any provision of its rules based on a petition if good cause is shown).

List of Subjects in 47 CFR Part 51

Communications common carriers, Deaveraged rate zones, Interconnection, Local competition, Pricing of elements, Telecommunications, Unbundled network elements.

Federal Communications Commission. Magalie Roman Salas, Secretary.

[FR Doc. 99-14792Filed6-15-99; 8:45 am]

BILLING CODE 6712-01-P

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