093_HB0875sam001
SRS093 00109 SDF 00109 a
1 AMENDMENT TO HOUSE BILL 875
2 AMENDMENT NO. . Amend House Bill 875, by replacing
3 everything after the enacting clause with the following:
4 "Section 5. The Public Utilities Act is amended by
5 adding Section 13-408 as follows:
6 (220 ILCS 5/13-408 new)
7 Sec. 13-408. Rates for unbundled loops provided as part
8 of an unbundled network element platform. This Section
9 applies to and covers certain unbundled network element rates
10 that shall be charged by incumbent local exchange carriers
11 that are subject to regulation under an alternative
12 regulation plan under Section 13-506.1 of this Act. The
13 General Assembly finds and determines that it should provide
14 direction to the Illinois Commerce Commission regarding the
15 establishment of the monthly recurring tariffed rates that
16 such incumbent local exchange carriers shall charge other
17 telecommunications carriers for unbundled loops provided in
18 combination with other unbundled network elements as part of
19 a network elements platform in order to ensure (i) that such
20 rates shall not significantly impair the incumbent local
21 exchange carrier's ability to raise capital on reasonable
22 terms or maintain a reasonable capital structure and (ii)
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1 that such incumbent local exchange carriers are able to
2 recover the efficient, forward-looking costs of creating,
3 operating, and maintaining the network outside plant
4 infrastructure capacity and switching and transmission
5 network capacity necessary to permit such incumbent local
6 exchange carriers to meet in a timely and adequate fashion
7 the obligations imposed by Section 8-101 of this Act. Nothing
8 contained in this Section 13-408 shall be deemed to relieve
9 an incumbent local exchange carrier from its burden of proof
10 under State or federal law with respect to these rates.
11 The Illinois Commerce Commission shall set the recurring
12 rates affected incumbent local exchange carriers receive for
13 unbundled loops provided in combination with other unbundled
14 network elements as part of a network elements platform in
15 accordance with the requirements delineated below.
16 (a) Cost of capital. The General Assembly directs that
17 the Illinois Commerce Commission, in calculating the cost of
18 capital, shall employ an evaluation that considers (i) the
19 current cost of capital, (ii) bypass of the incumbent local
20 exchange carrier's telecommunications network, (iii) the
21 regulatory risks assumed and created by the Federal
22 Communications Commission's unbundled network element costing
23 methodology, and (iv) the effect of increased risks because
24 of wholesale customer bankruptcies and bad debt. The General
25 Assembly finds that such evaluation shall also consider (i)
26 the risks associated with a forward-looking, competitive
27 telecommunications marketplace and (ii) a long-term analysis
28 that mitigates the impacts of transitory short-term
29 fluctuations in the telecommunications industry. In addition,
30 the Commission shall adjust all existing tariffed monthly
31 recurring rates for unbundled loops provided in combination
32 with other unbundled network elements as part of a network
33 elements platform that are currently in effect to make such
34 rates consistent with this provision.
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1 (b) Depreciation rates. The General Assembly further
2 directs that the Commission shall employ, consistent with the
3 Federal Communications Commission's unbundled network element
4 costing methodology, depreciation rates that are
5 forward-looking and consider the economic lives as reflected
6 in the incumbent local exchange carrier's books of accounts
7 as reported to the investment community under the regulations
8 of the Securities and Exchange Commission. Use of an
9 accelerated depreciation mechanism shall be required to the
10 extent consistent with the requirements of the Federal
11 Communications Commission's unbundled network element costing
12 methodology and use of a depreciation rate based on
13 historical rate-of-return regulation derived lives of the
14 elements and facilities in question shall be prohibited. In
15 addition, the Commission shall adjust all existing tariffed
16 monthly recurring rates for unbundled loops provided in
17 combination with other unbundled network elements as part of
18 a network elements platform that are currently in effect to
19 make such rates consistent with this provision.
20 Section 99. Effective date. This Act takes effect upon
21 becoming law.".