476.1D - REGULATION AND DEREGULATION OF COMMUNICATIONS SERVICES.

        476.1D  REGULATION AND DEREGULATION OF COMMUNICATIONS      SERVICES.         1.  Except as provided in this section, the jurisdiction of the      board as to the regulation of communications services is not      applicable to a service or facility that is provided or is proposed      to be provided by a telephone utility that is or becomes subject to      effective competition, as determined by the board.         a.  In determining whether a service or facility is or becomes      subject to effective competition, the board shall consider, among      other factors, whether a comparable service or facility is available      from a supplier other than the telephone utility in the geographic      market being considered by the board and whether market forces in      that market are sufficient to assure just and reasonable rates      without regulation.         b.  When considering market forces in the market proposed to      be deregulated, the board shall consider factors including but not      limited to the presence or absence of all of the following:         (1)  Wireless communications services.         (2)  Cable telephony services.         (3)  Voice over internet protocol services.         (4)  Economic barriers to the entry of competitors or potential      competitors in that market.         c.  In addition to other services or facilities previously      deregulated, effective July 1, 2005, and at the election of each      telephone utility subject to rate regulation, the jurisdiction of the      board is not applicable to the retail rate regulation of business and      retail local exchange services provided throughout the state except      for single line flat-rated residential and business service rates      provided by a telephone utility subject to rate regulation on January      1, 2005.  For each such telephone utility, the initial single line      flat-rated residential and business service rates shall be the      corresponding rates charged by the utility as of January 31, 2005.      The initial single line flat-rated residential monthly service rates      may be increased by an amount not to exceed one dollar per      twelve-month period beginning July 1, 2005, and ending June 30, 2008.      The initial single line flat-rated business monthly service rates may      be increased by an amount not to exceed two dollars per twelve-month      period beginning July 1, 2005, and ending June 30, 2008.  However,      the single line flat-rated residential service rate shall not exceed      nineteen dollars per month and the single line flat-rated business      service rate shall not exceed thirty-eight dollars per month prior to      July 1, 2008, not including charges for extended area service,      regulatory charges, taxes, and other fees.  Each telephone utility's      extended area service rates shall not be greater than the      corresponding rates charged by the telephone utility as of January      31, 2005.  The board shall determine a telephone utility's extended      area service rates for new extended area service established on or      after July 1, 2005.  If a telephone utility fails to impose the rate      increase during any twelve-month period, the utility shall not impose      the unused increase in any subsequent year.  In addition to the rate      increases permitted pursuant to this section, the telephone utility      may adjust its single line flat-rated residential and business      service rates by a percentage equal to the most recent annual      percentage change in the gross domestic product price index as      published by the federal government.  The board may also authorize      additional changes in the monthly rates for single line flat-rated      residential and business services to reflect exogenous factors beyond      the control of the telephone utility.         A telephone utility that elects to increase single line flat-rated      residential or business service rates pursuant to this paragraph      "c" shall offer digital subscriber line broadband service in all      of the telephone utility's exchanges in this state within eighteen      calendar months of the first rate increase made pursuant to this      paragraph "c" by the telephone utility.  The board may extend      this deadline by up to nine calendar months for good cause.  The      board may assess a civil penalty or require a refund of all      incremental revenue resulting from the rate increase initiated      pursuant to this paragraph "c" if the telephone utility fails to      offer digital subscriber line broadband service within the time      period required by this unnumbered paragraph.         Effective July 1, 2008, the retail rate jurisdiction of the board      shall not be applicable to single line flat-rated residential and      business service rates unless the board during the first six calendar      months of 2008 extends its retail rate jurisdiction over single line      flat-rated residential and business service rates provided by a      previously rate-regulated telephone utility.  The board may extend      its jurisdiction pursuant to this paragraph for not more than two      years and may do so only after the board finds that such action is      necessary for the public interest.  The board shall provide the      general assembly with a copy of any order to extend its jurisdiction      and shall permit any telephone utility subject to the extension to      increase single line flat-rated residential and business monthly      service rates by an amount up to two dollars during each twelve-month      period of the extension.  If a telephone utility fails to impose such      a rate increase during any twelve-month period, the utility may not      impose the unused increase in any subsequent year.         2.  Except as provided in subsection 1, paragraph "c",      deregulation of a service or facility for a utility is effective only      after a finding of effective competition by the board.         3.  If the board finds that a service or facility is subject to      effective competition, the board shall deregulate the service or      facility within a reasonable time.         4.  Upon deregulation, all investment, revenues, and expenses      associated with the service or facility shall be removed from the      telephone utility's regulated operations and shall not be considered      by the board in setting rates for the telephone utility unless they      continue to affect the utility's regulated operations.  If the board      considers investment, revenues, and expenses associated with      unregulated services or facilities in setting rates for the telephone      utility, the board shall not use any profits or costs from such      unregulated services or facilities to determine the rates for      regulated services or facilities.  This section does not preclude the      board from considering the investment, revenues, and expenses      associated with the sale of classified directory advertising by a      telephone utility in determining rates for the telephone utility.         5.  Notwithstanding the presence of effective competition, if the      board determines a service or facility is an essential communications      service or facility and the public interest warrants retention of      service regulation, the board shall deregulate rates and may continue      service regulation.         6.  The board may reimpose rate and service regulation on a      deregulated service or facility if it determines the service or      facility is no longer subject to effective competition.         7.  The board may reimpose service regulation only on a      deregulated service or facility if the board determines the service      or facility is an essential communications service or facility and      the public interest warrants service regulation, notwithstanding the      presence of effective competition.         8.  If the board reimposes regulation pursuant to subsection 6 or      7, the reimposition of regulation shall apply to all providers of the      service or facility.         9.  The board may investigate and obtain information from      providers of deregulated services or facilities to determine whether      the services or facilities are subject to effective competition or      whether the service or facility is an essential communications      service or facility and the public interest warrants service      regulation.  However, the board shall not, for purposes of this      subsection, request or obtain information related to the provider's      costs or earnings.         10.  The board, at the request of a long distance telephone      company, shall classify such company as a competitive long distance      telephone company if more than half of the company's revenues from      its Iowa intrastate telecommunications services and facilities are      received from services and facilities that the board has determined      to be subject to effective competition, or if more than half of the      company's revenues from its Iowa intrastate telecommunications      services and facilities are received from intralata interexchange      services and facilities.  For purposes of this subsection,      "intralata interexchange services" means those interexchange      services that originate and terminate within the same local access      transport area.         The board shall promptly notify the director of revenue that a      long distance telephone company has been classified as a competitive      long distance telephone company.  Upon such notification by the      board, the director of revenue shall assess the property of such      competitive long distance telephone company, which property is first      assessed for taxation in this state on or after January 1, 1996, in      the same manner as all other property assessed as commercial property      by the local assessor under chapters 427, 427A, 427B, 428, and 441.      As used in this section, "long distance telephone company" means      an entity that provides telephone service and facilities between      local exchanges, but does not include a cellular service provider or      a local exchange utility holding a certificate issued under section      476.29, subsection 12.  
         Section History: Recent Form
         91 Acts, ch 150, §2; 95 Acts, ch 199, § 1; 96 Acts, ch 1219, § 73;      2003 Acts, ch 126, §1; 2003 Acts, ch 145, §286; 2005 Acts, ch 9, §1;      2006 Acts, ch 1010, §123         Referred to in § 476.55, 476.103, 477.9A, 477C.7