CHAPTER 51. GENERAL PROVISIONS
UTILITIES CODE
TITLE 2. PUBLIC UTILITY REGULATORY ACT
SUBTITLE C. TELECOMMUNICATIONS UTILITIES
CHAPTER 51. GENERAL PROVISIONS
Sec. 51.001. POLICY. (a) Significant changes have occurred in
telecommunications since the law from which this title is derived
was originally adopted. To encourage and accelerate the
development of a competitive and advanced telecommunications
environment and infrastructure, new rules, policies, and
principles must be formulated and applied to protect the public
interest. Changes in technology and market structure have
increased the need for minimum standards of service quality,
customer service, and fair business practices to ensure
high-quality service to customers and a healthy marketplace where
competition is permitted by law. It is the purpose of this
subtitle to grant the commission authority to make and enforce
rules necessary to protect customers of telecommunications
services consistent with the public interest.
(b) It is the policy of this state to:
(1) promote diversity of telecommunications providers and
interconnectivity;
(2) encourage a fully competitive telecommunications
marketplace; and
(3) maintain a wide availability of high quality, interoperable,
standards-based telecommunications services at affordable rates.
(c) The policy goals described by Subsection (b) are best
achieved by legislation that modernizes telecommunications
regulation by:
(1) guaranteeing the affordability of basic telephone service in
a competitively neutral manner; and
(2) fostering free market competition in the telecommunications
industry.
(d) The technological advancements, advanced telecommunications
infrastructure, and increased customer choices for
telecommunications services generated by a truly competitive
market play a critical role in Texas' economic future by raising
living standards for Texans through:
(1) enhanced economic development; and
(2) improved delivery of education, health, and other public and
private services.
(e) The strength of competitive forces varies widely between
markets, products, and services. It is the policy of this state
to require the commission to take action necessary to enhance
competition by adjusting regulation to match the degree of
competition in the marketplace to:
(1) reduce the cost and burden of regulation; and
(2) protect markets that are not competitive.
(f) It is the policy of this state to ensure that high quality
telecommunications services are available, accessible, and usable
by an individual with a disability, unless making the services
available, accessible, or usable would:
(1) result in an undue burden, including unreasonable cost or
technical infeasibility; or
(2) have an adverse competitive effect.
(g) It is the policy of this state to ensure that customers in
all regions of this state, including low-income customers and
customers in rural and high cost areas, have access to
telecommunications and information services, including
interexchange services, cable services, wireless services, and
advanced telecommunications and information services, that are
reasonably comparable to those services provided in urban areas
and that are available at prices that are reasonably comparable
to prices charged for similar services in urban areas. Not later
than November 1, 1999, the commission shall begin a review and
evaluation of the availability and the pricing of
telecommunications and information services, including
interexchange services, cable services, wireless services, and
advanced telecommunications and information services, in rural
and high cost areas, as well as the convergence of
telecommunications services. The commission shall file a report
with the legislature not later than January 1, 2001. The report
must include the commission's recommendations on the issues
reviewed and evaluated.
Acts 1997, 75th Leg., ch. 166, Sec. 1, eff. Sept. 1, 1997.
Amended by Acts 1999, 76th Leg., ch. 1212, Sec. 4, eff. Sept. 1,
1999.
Sec. 51.002. DEFINITIONS. In this subtitle:
(1) "Basic local telecommunications service" means:
(A) flat rate residential and business local exchange telephone
service, including primary directory listings;
(B) tone dialing service;
(C) access to operator services;
(D) access to directory assistance services;
(E) access to 911 service provided by a local authority or dual
party relay service;
(F) the ability to report service problems seven days a week;
(G) lifeline and tel-assistance services; and
(H) any other service the commission determines after a hearing
is a basic local telecommunications service.
(2) "Dominant carrier" means a provider of a communication
service provided wholly or partly over a telephone system who the
commission determines has sufficient market power in a
telecommunications market to control prices for that service in
that market in a manner adverse to the public interest. The term
includes a provider who provided local exchange telephone service
within a certificated exchange area on September 1, 1995, as to
that service and as to any other service for which a competitive
alternative is not available in a particular geographic market.
In addition, with respect to:
(A) intraLATA long distance message telecommunications service
originated by dialing the access code "1-plus," the term includes
a provider of local exchange telephone service in a certificated
exchange area for whom the use of that access code for the
origination of "1-plus" intraLATA calls in the exchange area is
exclusive; and
(B) interexchange services, the term does not include an
interexchange carrier that is not a certificated local exchange
company.
(3) "Incumbent local exchange company" means a local exchange
company that has a certificate of convenience and necessity on
September 1, 1995.
(4) "Local exchange company" means a telecommunications utility
that has a certificate of convenience and necessity or a
certificate of operating authority to provide in this state:
(A) local exchange telephone service;
(B) basic local telecommunications service; or
(C) switched access service.
(5) "Local exchange telephone service" means telecommunications
service provided within an exchange to establish connections
between customer premises within the exchange, including
connections between a customer premises and a long distance
provider serving the exchange. The term includes tone dialing
service, service connection charges, and directory assistance
services offered in connection with basic local
telecommunications service and interconnection with other service
providers. The term does not include the following services,
whether offered on an intraexchange or interexchange basis:
(A) central office based PBX-type services for systems of 75
stations or more;
(B) billing and collection services;
(C) high-speed private line services of 1.544 megabits or
greater;
(D) customized services;
(E) private line or virtual private line services;
(F) resold or shared local exchange telephone services if
permitted by tariff;
(G) dark fiber services;
(H) non-voice data transmission service offered as a separate
service and not as a component of basic local telecommunications
service;
(I) dedicated or virtually dedicated access services; or
(J) any other service the commission determines is not a "local
exchange telephone service."
(6) "Long run incremental cost" has the meaning assigned by 16
T.A.C. Section 23.91 or its successor.
(7) "Pricing flexibility" includes:
(A) customer specific contracts;
(B) packaging of services;
(C) volume, term, and discount pricing;
(D) zone density pricing, with a zone to be defined as an
exchange; and
(E) other promotional pricing.
(8) "Public utility" or "utility" means a person or river
authority that owns or operates for compensation in this state
equipment or facilities to convey, transmit, or receive
communications over a telephone system as a dominant carrier. The
term includes a lessee, trustee, or receiver of any of those
entities, or a combination of those entities. The term does not
include a municipal corporation. A person is not a public utility
solely because the person:
(A) furnishes or furnishes and maintains a private system;
(B) manufactures, distributes, installs, or maintains customer
premise communications equipment and accessories; or
(C) furnishes a telecommunications service or commodity only to
itself, its employees, or its tenants as an incident of
employment or tenancy, if that service or commodity is not resold
to or used by others.
(9) "Separation" means the division of plant, revenues,
expenses, taxes, and reserves applicable to exchange or local
service if these items are used in common to provide public
utility service to both local exchange telephone service and
other service, such as interstate or intrastate toll service.
(10) "Telecommunications provider":
(A) means:
(i) a certificated telecommunications utility;
(ii) a shared tenant service provider;
(iii) a nondominant carrier of telecommunications services;
(iv) a provider of commercial mobile service as defined by
Section 332(d), Communications Act of 1934 (47 U.S.C. Section 151
et seq.), Federal Communications Commission rules, and the
Omnibus Budget Reconciliation Act of 1993 (Public Law 103-66),
except that the term does not include these entities for the
purposes of Chapter 17, 55, or 64;
(v) a telecommunications entity that provides central office
based PBX-type sharing or resale arrangements;
(vi) an interexchange telecommunications carrier;
(vii) a specialized common carrier;
(viii) a reseller of communications;
(ix) a provider of operator services;
(x) a provider of customer-owned pay telephone service; or
(xi) a person or entity determined by the commission to provide
telecommunications services to customers in this state; and
(B) does not mean:
(i) a provider of enhanced or information services, or another
user of telecommunications services, who does not also provide
telecommunications services; or
(ii) a state agency or state institution of higher education, or
a service provided by a state agency or state institution of
higher education.
(11) "Telecommunications utility" means:
(A) a public utility;
(B) an interexchange telecommunications carrier, including a
reseller of interexchange telecommunications services;
(C) a specialized communications common carrier;
(D) a reseller of communications;
(E) a communications carrier who conveys, transmits, or receives
communications wholly or partly over a telephone system;
(F) a provider of operator services as defined by Section
55.081, unless the provider is a subscriber to customer-owned pay
telephone service; and
(G) a separated affiliate or an electronic publishing joint
venture as defined in Chapter 63.
(12) "Tier 1 local exchange company" has the meaning assigned by
the Federal Communications Commission.
Acts 1997, 75th Leg., ch. 166, Sec. 1, eff. Sept. 1, 1997.
Amended by Acts 1999, 76th Leg., ch. 1212, Sec. 5, eff. Sept. 1,
1999; Acts 1999, 76th Leg., ch. 1579, Sec. 4, eff. Aug. 30, 1999;
Acts 2001, 77th Leg., ch. 651, Sec. 5, eff. Sept. 1, 2001.
Sec. 51.003. APPLICABILITY. Except as otherwise expressly
provided by this title, this title does not apply to:
(1) a company that as its only form of business:
(A) is a telecommunications manager; or
(B) administers central office based or customer based PBX-type
sharing/resale arrangements;
(2) telegraph services;
(3) television or radio stations;
(4) community antenna television services; or
(5) a provider of commercial mobile service as defined by
Section 332(d), Communications Act of 1934 (47 U.S.C. Section 151
et seq.), Federal Communications Commission rules, and the
Omnibus Budget Reconciliation Act of 1993 (Public Law 103-66),
other than conventional rural radio-telephone services provided
by a wire-line telephone company under the Public Mobile Service
rules of the Federal Communications Commission (47 C.F.R. Part
22).
Acts 1997, 75th Leg., ch. 166, Sec. 1, eff. Sept. 1, 1997.
Sec. 51.004. PRICING FLEXIBILITY. (a) A discount or other form
of pricing flexibility may not be:
(1) unreasonably preferential, prejudicial, or discriminatory;
or
(2) predatory or anticompetitive.
(b) This title does not prohibit a volume discount or other
discount based on a reasonable business purpose. A price that is
set at or above the long run incremental cost of a service is
presumed not to be a predatory price.
(c) This title allows an offer based on a reasonable business
purpose, including an offer made at any time to a selected
customer or a group of customers in response to a competitor's
offer or a former customer's acceptance of a competitor's offer
if the price of the offer meets the requirements of Section
52.0584, 58.063, or 59.031.
(d) An offer made under Subsection (c) must be made in
compliance with Chapter 304, Business & Commerce Code.
Acts 1997, 75th Leg., ch. 166, Sec. 1, eff. Sept. 1, 1997.
Amended by Acts 1999, 76th Leg., ch. 1212, Sec. 6, eff. Sept. 1,
1999; Acts 2003, 78th Leg., ch. 32, Sec. 1, eff. Sept. 1, 2003.
Amended by:
Acts 2007, 80th Leg., R.S., Ch.
885, Sec. 2.39, eff. April 1, 2009.
Sec. 51.005. ASSISTANCE TO MUNICIPALITY. On request of a
municipality, the commission may advise and assist the
municipality with respect to a question or proceeding arising
under this title. Assistance provided by the commission may
include aid to a municipality on a matter pending before the
commission or a court, such as making a staff member available as
a witness or otherwise providing evidence to the municipality.
Acts 1997, 75th Leg., ch. 166, Sec. 1, eff. Sept. 1, 1997.
Sec. 51.006. MUNICIPAL PARTICIPATION IN RATEMAKING PROCEEDINGS.
(a) The governing body of a municipality participating in a
ratemaking proceeding may engage rate consultants, accountants,
auditors, attorneys, and engineers to:
(1) conduct investigations, present evidence, and advise and
represent the governing body; and
(2) assist the governing body with litigation before the
commission or a court.
(b) The public utility in the ratemaking proceeding shall
reimburse the governing body of the municipality for the
reasonable cost of the services of a person engaged under
Subsection (a) to the extent the commission determines is
reasonable.
Acts 1997, 75th Leg., ch. 166, Sec. 1, eff. Sept. 1, 1997.
Sec. 51.007. MUNICIPAL STANDING IN CERTAIN CASES. (a) A
municipality has standing in each case before the commission that
relates to a utility providing service in the municipality.
(b) A municipality's standing is subject to the right of the
commission to:
(1) determine standing in a case involving a retail service area
dispute that involves two or more utilities; and
(2) consolidate municipalities on an issue of common interest.
Acts 1997, 75th Leg., ch. 166, Sec. 1, eff. Sept. 1, 1997.
Sec. 51.008. JUDICIAL REVIEW. A municipality is entitled to
judicial review of a commission order relating to a utility
providing services in the municipality as provided by Section
15.001.
Acts 1997, 75th Leg., ch. 166, Sec. 1, eff. Sept. 1, 1997.
Sec. 51.009. MUNICIPAL FEES. (a) Nothing in this title,
including Section 53.201, may be construed as in any way limiting
the right of a public utility to pass through a municipal fee,
including an increase in a municipal fee.
(b) A public utility that traditionally passes through municipal
fees shall promptly pass through any municipal fee reduction.
Acts 1997, 75th Leg., ch. 166, Sec. 1, eff. Sept. 1, 1997.
Sec. 51.010. COMMISSION INVESTIGATION OF SALE, MERGER, OR
CERTAIN OTHER ACTIONS. (a) The commission, not later than the
180th day after the date a public utility reports to the
commission under Section 14.101, shall complete an investigation
under that section and enter a final order.
(b) If a final order is not entered as required by Subsection
(a), the commission is considered to have determined that the
action taken by the public utility is consistent with the public
interest.
(c) Section 14.101 does not apply to:
(1) a company that receives a certificate of operating authority
or a service provider certificate of operating authority under
Chapter 54; or
(2) a company electing under Chapter 58.
Acts 1997, 75th Leg., ch. 166, Sec. 1, eff. Sept. 1, 1997.