Sunset of Title 37, Chapter 15 of the Wyoming Statutes

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1 Sunset of Title 37, Chapter 15 of the Wyoming Statutes The Wyoming Telecommunications Act of 1995: The Wyoming Telecommunications Act of 1995, hereinafter referred to as the Act, was enacted by the Wyoming Legislature, in advance of the federal Telecommunications Act of It is currently subject to a sunset provision effective July 1, The purpose of this paper is to address the impacts of a possible sunset. A discussion of the Act s provisions, including definitions, follows the more general discussion. Impacts of Sunset Deregulation: The question arises as to the state of regulation of telecommunications services in Wyoming should the Act, in its present form, sunset. Concurrent with the passage of the Act, references to telecommunications were removed from the definition of public utilities contained in Chapter 1 of Title The regulation of telecommunications services and telecommunications companies was then governed by the provisions of the Act as more generally described later. The short answer is that telecommunications services and telecommunications companies will no longer be subject to state regulation. Some of the more notable effects of such state related deregulation are discussed below. The regulation of telecommunications services at the federal level will be unaffected. While an analysis of federal regulation of telecommunications services is largely beyond the scope of this discussion, the Wyoming Public Service Commission, hereinafter referred to as the Commission may retain some residual oversight of telecommunications services pursuant to federal law. It is also important to note that the Commission may lose some authority which is currently granted to it under federal law. For example, the Commission currently approves wholesale interconnection agreements and grants Eligible Telecommunications Carrier (ETC) designations. To the extent that such federally granted authority is premised upon the Commission having jurisdiction over telecommunications, such delegated authority would terminate. To the extent that this occurs, companies would have to seek ETC designations and interconnection agreement approvals from the Federal Communications Commission. In the event of a sunset, state law will no longer distinguish between the various types of telecommunications services, i.e.: competitive, essential, interexchange, local exchange, noncompetitive, supported, access, etc. There will also be no restrictions or requirements relative to the pricing of any such services. 1 W.S (a) 2 W.S (a)(vi)(B) Repealed by Laws 1995, ch. 181, 3. Page 1 of 11

2 Further, state law will not impose any type of registration or certificate requirement in order for a telecommunications company to provide services within Wyoming. Companies providing what was previously defined as local exchange services will not be required to demonstrate that they possess sufficient technical, financial and managerial resources in order to operate within the state. Such a result will require customers to perform an additional level of due diligence prior to selecting a service provider. The Commission s telecommunications related rules will be nullified. Pursuant to the provisions of the Wyoming Administrative Procedures Act, agency rules must be within the scope of the statutory authority delegated to the adopting agency. 3 As described later, the Act grants the Commission the authority to promulgate rules addressing, inter alia, interconnection and unbundling, administration of phone numbers, number portability, and resale. 4 The Commission s current rules cover a wide range of telecommunications related topics including: the Wyoming Universal Service Fund, service quality, record and reporting requirements, customer/provider relations, construction and maintenance practices, maintenance/emergency provisions, service availability, service adequacy, customer access lines, interoffice trunking, network call completion requirements, trouble report response, annual reporting requirements, eligible telecommunications carrier (ECT) designation, TLSRIC, and exclusive agreements. 5 To the extent that any of the Commission s telecommunications rules were adopted in compliance with federal law or regulations, they may be permitted to stand. 6 However, as noted above, to the extent that the federal laws or regulations confer authority to the Commission premised upon its jurisdiction over telecommunications, such authority, and rules promulgated in conjunction with it, would terminate. With regard to what the Act describes as consumer protections, there will no longer be any specific, Commission enforceable state prohibition against telecommunications companies engaging in discriminatory or anti-competitive behavior. Companies will also not face a specific, state imposed requirement to timely and uniformly disclose information relating to interconnection or refuse to provide services. Further, companies providing what were previously defined as noncompetitive services would be free to discontinue providing such services without prior Commission approval. Also of note, there will no longer be a state imposed prohibition against what has become known as slamming, which is the unauthorized change of a customer s telecommunications company. Customers will retain the option of pursuing complaints at the federal level. Telecommunications companies will be under no obligation to file price schedules, including terms and conditions of service, with the Commission and there will no longer 3 W.S (d)(i) 4 W.S (e) 5 See generally Chapter 5 of the Commission s Procedural Rules and Special Regulations 6 W.S (a)((F)(I) Page 2 of 11

3 be a Commission related forum in which customers may complain regarding the reasonableness of telecommunications service prices. Further, service quality will no longer be subject to Commission oversight. Again, customers will retain the option of pursuing complaints at the federal level. The Wyoming Universal Service Fund will also cease to exist. The end result is that customers could possibly pay more than 130% of the weighted state-wide average rate for what was previously known as essential local exchange services. Given that companies will no longer be subject to pricing requirements, will not be required to maintain price schedules, and will not be required to make annual fund related price and line count filings, the weighted statewide average essential local exchange service rate will be difficult to determine. The potential ramifications of such an occurrence would be difficult to quantify but could potentially leave certain customers without affordable service alternatives. What Remains: There are a number of telecommunications related issues and programs which currently reside outside the context of the Act. They will, as a result, be unaffected by a sunset. These include, inter alia, the Telephone Assistance Program (TAP), 911, and the Message Relay. The TAP provides eligible residential customers with a discount on the monthly charge for local exchange service. 7 Eligibility is determined by the Wyoming Department of Family Services and limited to a single resident line at the principal residence of the subscriber. 8 While the statutory provisions relating to this program are listed in the Act s Applicability of Existing Law section, 9 they are not currently subject to a sunset provision. Emergency Telephone Service (911) is governed by the provisions of the Emergency Telephone Service Act. 10 It specifically provides for, inter alia, a surcharge to be collected from telecommunications service customers to fund emergency telecommunications systems. The operation of such services is the province of public agencies which are defined as cities, towns, counties or other political subdivisions. 11 The Emergency Telephone Service Act is not subject to a sunset provision and will be unaffected by a sunset of the Act. Telecommunications for the Communications Impaired (Message Relay) are governed by the provisions of Article 2 of Chapter 9 of Title 16 of the Wyoming Statutes. 12 The program specifically provides for specialized telecommunications equipment and 7 W.S (a) 8 W.S (a) 9 W.S W.S through W.S (a)(vi). 12 W.S through 210 Page 3 of 11

4 message relay services to persons who are communications impaired. 13 The statutory provisions governing this program are not subject to a sunset provision and will be unaffected by a sunset of the Act. The Transmitting Utility Act has applicability to corporations or business entities primarily engaged, pursuant to rights or franchises issued by a state or federal regulatory body, in the railroad or street railway business, the telephone or telegraph business, the transmission of oil, gas or petroleum products by pipeline, or the transmission or the production and transmission of electricity, steam, gas or water. 14 The Transmitting Utility Act generally governs the filing of security interests, 15 and will be unaffected by a sunset of the Act. Issues relating to eminent domain and rights of way will also be unaffected by a sunset of the Act. Provisions relating to eminent domain are found in the Wyoming Constitution 16 as well as Title 1 of the Wyoming Statutes. 17 Provisions relating to rights of way are contained in Title 17 of the same. 18 It is, perhaps, worthy of note that these statutes actually use the term telegraph company. Miscellaneous criminal provisions will also survive a sunset of the Act. For example, it will remain a felony to willfully damage public telephones, lines or poles. 19 Likewise, it will remain a misdemeanor to make, possess or sell equipment designed to conceal source or avoid charges for telecommunications services. 20 It will also remain a criminal act to fail to yield a telephone for reporting emergencies. 21 The Act: The general discussion above is, perhaps, informed by an additional discussion of the Act, in its current form. The Act has evolved over the years since its inception. In its current form, it contains provisions relating to the following: General Provisions: Article 1 contains general provisions which include definitions and a description of services not regulated. Definitions: Various definitions are contained in Article 1. The most notable definitions include those relating to: competitive telecommunications services, essential telecommunications services, interexchange telecommunications company, 13 W.S (a) 14 W.S (a)(i) 15 W.S Wyoming Constitution Article W.S through W.S through W.S W.S W.S through 130 Page 4 of 11

5 local exchange service, noncompetitive telecommunications services, telecommunications service, total service long-run incremental cost (TSLRIC), universal service, and supported services. 22 Competitive Telecommunications Services: These are defined as those services found by the legislature or the commission to be competitive in accordance with W.S Essential Telecommunications Services: These are defined as a customer's access to service that is necessary for the origination or termination, or both, of two-way, switched telecommunications for both residential and business service within a local exchange area. 24 Such services are limited to: access to interexchange services, single line flat-rate or single line measured residence or business voice service; transmission service and facilities necessary for the connection between the end user's or customer's premises and local network switching facility; services necessary to connect 911 emergency services to the local network; and switched access, which is the switching and transport necessary to connect an interexchange telecommunications company with the local exchange central office. Interexchange Telecommunications Company: Such companies provide telecommunications service to connect end users located in different local exchange areas, but excluding companies which also provide noncompetitive local exchange services. 25 Local Exchange Service: This is the provision of essential telecommunications service within a local exchange area. 26 Noncompetitive Telecommunications Services: These are those services which have not been found by the legislature or the commission to be competitive in accordance with W.S W.S W.S (a)(iii) 24 W.S (a)(iv) 25 W.S (a)(v) 26 W.S (a)(viii) 27 W.S (a)(ix) Page 5 of 11

6 Telecommunications Services: Such services are defined as the offering or transmitting for hire of telecommunications by means of telecommunications facilities using wire, radio, lightwave or other means. 28 TSLRIC: This term is defined as the total forward-looking cost, using least cost technology, for a telecommunications service or basic network function that the telecommunications provider would incur if it were to initially offer such telecommunications service or basic network function. 29 Universal Service: This is defined as the general availability of essential telecommunications service at an affordable and reasonable price. 30 Supported Services: Such services include the services or functionalities which shall be supported by the state universal service fund. They include: voice grade access to the public switched network, local usage, dual tone multi-frequency signaling or its functional equivalent, single-party service or its functional equivalent, access to emergency services, access to operator services, access to interexchange service, access to directory assistance, and toll limitation for qualifying low-income consumers. 31 Unregulated Services: Services not regulated by the Act include: one-way transmission of radio or television signals for broadcast purposes, including the one-way transmission of video programming by a cable television or other system as well as subscriber interaction which is required for the selection of video programming; home and business and coinless, or coin operated public or semipublic telephone terminal equipment, and the use, location and charges for the use of such equipment; billing and collection services; inside wire and premise cable installation and maintenance; directory services; services using radio spectrum, cellular, or other wireless technology; video dial tone and multimedia services; private telecommunications networks; nonvoice data services not operated by a company providing local exchange service; networks established by a person other than the local exchange company providing essential telecommunications services within the local exchange area to provide access to interexchange carrier services; direct inward dial services and other services needed by answering services and paging services; and remote meter reading. 32 Internet Protocol Enabled Services: Such services are defined as any service, capability, functionality or application, other than "voice over internet 28 W.S (a)xii) 29 W.S (a)(xiii) 30 W.S (a)xiv) 31 W.S (a)(xvi) 32 W.S Page 6 of 11

7 protocol service," (VoIP) using existing internet protocol, or any successor internet protocol, that enables an end user to send or receive a communication in existing internet protocol format, or any successor internet protocol format, utilizing a broadband connection at the end user's location, regardless of whether the communication is voice, data or video. Such services are generally not subject to Commission regulation. 33 Voice Over Internet Protocol Services: Such services are defined as any service that [e]nables real time, two-way voice communication originating from or terminating at the user's location in internet protocol or a successor protocol; [u]tilizes a broadband connection at the user's location; and [p]ermits a user to receive a call that originates on the public switched telephone network and to terminate a call to the public switched telephone network. Such services are generally not subject to Commission regulation, however, they are subject to assessments and special fees. 34 Regulation of Competitive and Noncompetitive Markets: Article 2 contains provisions relating to the regulation of local exchange services, certificates of public convenience and necessity. This article also addresses the determination of competitive services, the price regulation of noncompetitive essential services, and price schedules. The Act provides that all telecommunications companies seeking to provide local exchange services are required to obtain a certificate of public convenience and necessity from the Commission prior to providing such services. It also provides that the Commission shall grant such a certificate if it finds, after notice and opportunity for hearing, that the applicant possesses sufficient technical, financial and managerial resources to provide safe, adequate and reliable local exchange services within the identified geographic area. 35 The Act also provides that upon petition by any telecommunications company, the commission may, after notice and opportunity for hearing, determine that a telecommunications service is subject to competition. Any such service which is found to be effectively competitive shall not be subject to price regulation. It further contains provisions which allow the Commission to conclude that a telecommunications service previously found to be competitive is no longer subject to competition, and therefore not subject to treatment as a competitive service. 36 The Act further defines telecommunications service provided by new entrants, local exchange services provided by resale, telecommunications services provided by 33 W.S (a)(i) 34 W.S (a)(ii) 35 W.S W.S (a)&(b) Page 7 of 11

8 interexchange telecommunications companies, interexchange telecommunications services and telecommunications services other than local exchange service and switched access provided by a local exchange company as competitive services. 37 Upon application for a defined area, retail telecommunications services other than switched access, may be deemed competitive provided that certain defined criteria are met, which include: the predetermined percentage of customers having access to at least one landline carrier unaffiliated with the applicant; the predetermined percentage of customers having access to at least one wireless provider unaffiliated with the applicant; and the applicant agrees to provide throughout the area prices which do not vary by geographic location or access to competitors. Additional requirements relating to pricing apply. 38 The prices for noncompetitive essential telecommunications services of provided by any local exchange company may, subject to certain restrictions, be adjusted downward at the company's discretion. The prices for such services are subject to a maximum as determined by the Commission. The initial maximum shall be the local exchange company's price for such services as of July 1, Local exchange companies may increase the price for such services to the level of the maximum without approval of the Commission. 39 Generally, the price of noncompetitive switched access services is not to exceed $.03 per minute after January 1, The Act provided that, pursuant to the terms of a Commission approved transition plan, such prices could remain above $.03 per minute until January 1, The Act requires that local exchange companies file price schedules, including terms and conditions of service, for all competitive and noncompetitive telecommunications services. Any price increases for noncompetitive telecommunications services must be filed 30 days prior to the proposed effective date and customers must be given notice at least one full billing cycle in advance. 41 Interexchange Companies: Article 3 addresses the regulation of interexchange companies. Interexchange companies not authorized to provide service in Wyoming on or before January 1, 1995, are required to register with the Commission 37 W.S (c) 38 W.S (d) 39 W.S (a) 40 W.S (j) 41 W.S (a) Page 8 of 11

9 prior to providing services. Interexchange telecommunications services are not subject to pricing regulation. 42 Regulation of Telecommunications Services Generally: Article 4 addresses the Commission s powers, the protection of telecommunications consumers, complaints against prices, service quality, annual reporting requirements, the applicability of existing law, the construction of the Act with other laws, the unauthorized change of telecommunications companies, unauthorized services, prohibited practices and penalties. The Act prohibits the Commission from giving unreasonably discriminatory or preferential treatment to any telecommunications company. 43 It further grants the Commission the power to, inter alia, conduct investigations, require compliance with applicable laws, promulgate rules and regulations, require reports and studies, and hold hearings on complaints. 44 With regard to the Commission s rule making authority, the Act specifically grants the Commission the power to promulgate rules and regulations regarding the interconnection of telecommunications networks at nondiscriminatory and reasonable rates, terms and conditions; the effective and efficient interoperability of telecommunications networks; the unbundling of services into reasonable basic network features; the administration and allocation of phone numbers to the extent technically and economically feasible; telephone number portability to the full extent technically feasible; and the resale and sharing of services and functions at reasonable and nondiscriminatory rates. 45 The Act prohibits telecommunications companies from engaging in anti-competitive behavior, including, but not limited to, discrimination in favor of its affiliates. 46 It further provides that telecommunications companies shall not unreasonably discriminate as to customers in prices, terms or conditions of service, or in connection to or with other telecommunications companies. Such companies may, however, provide volume or other price discounts based on reasonable, nonpredatory business practices; pass through any state, municipal or local taxes to the customers in the area where the tax is levied; and provide free or reduced price service to its current or pensioned employees and dependent members of their families W.S (a) 43 W.S (b) 44 W.S W.S (e) 46 W.S (f) 47 W.S (a) Page 9 of 11

10 Telecommunications companies providing a noncompetitive telecommunications service shall not discontinue providing the service without the commission's approval. 48 They are also prohibited from failing to timely and uniformly disclose information necessary for the design of equipment and services that will meet the specifications of interconnection; and failing or refusing to provide a services or products in accordance with applicable tariffs, price lists or contracts. 49 The Act provides for complaints to be filed relating to the prices of noncompetitive telecommunications services and service quality in general. The Commission, on its own motion, may also initiate and investigation into such matters. The Commission is give the authority to set aside unreasonable or unreasonably discriminatory prices 50 and direct telecommunications companies to take remedial action to address service quality issues. With regard to the prices of noncompetitive services, those in effect as of July 1, 2006, are statutorily deemed to be fair and reasonable. With regard to Commission directed service quality remedial actions, the Act provides for compliance cost recovery. 51 The Act specifically enumerates provisions of Title 37 that remain applicable to telecommunications companies. These range from general provisions regarding the Commission and its administrative functions to more specific items. Of note are the provisions relating to the obligation to pay the Commission s uniform public utility assessment; the Commission s arbitration powers; the Telephone Assistance Program; safety standards; and the provisions relating to crimes, offenses, and civil liabilities. 52 The Act prohibits the changing any consumer's telecommunications company if the change is willfully made without the knowledge and consent of that consumer. It further requires the Commission to provide information or technical assistance regarding appropriate action for the consumer to take in order not to receive solicitations. 53 Universal Service Fund: Article 5 establishes the Wyoming Universal Service Fund and addresses issues relating to contributions, administration, eligibility and distributions. The Act created the Wyoming Universal Service Fund which is administered by the Commission and designed to ensure that no telecommunications service customer shall pay, after consideration of federal Universal Service Funds, no more than 130% of the 48 W.S (c) 49 W.S (d) 50 W.S W.S W.S W.S Page 10 of 11 Advocate Prepared by the Wyoming Office of Consumer

11 weighted statewide average price for essential local exchange services. Both landline and wireless telecommunications service providers are eligible W.S Page 11 of 11 Advocate Prepared by the Wyoming Office of Consumer