1.1                          A bill for an act 
  1.2             relating to telecommunications; authorizing creation 
  1.3             of telecommunication services purchasing cooperatives; 
  1.4             amending Minnesota Statutes 1996, section 237.065; 
  1.5             proposing coding for new law in Minnesota Statutes, 
  1.6             chapter 308A. 
  1.7   BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.8      Section 1.  Minnesota Statutes 1996, section 237.065, is 
  1.9   amended to read: 
  1.10     237.065 [RATES FOR SPECIAL SERVICE TO SCHOOLS AND 
  1.11  TELECOMMUNICATION SERVICES PURCHASING COOPERATIVES.] 
  1.12     Subdivision 1.  [BASIC SERVICES.] Each telephone company, 
  1.13  including a company that has developed an incentive plan under 
  1.14  section 237.625, that provides local telephone service in a 
  1.15  service area that includes a school that has classes within the 
  1.16  range from kindergarten to 12th grade shall provide, upon 
  1.17  request, additional service to the school that is sufficient to 
  1.18  ensure access to basic telephone service from each classroom and 
  1.19  other areas within the school, as determined by the school 
  1.20  board.  Each company shall set a flat rate for this additional 
  1.21  service that is less than the company's flat rate for an access 
  1.22  line for a business and the same as or greater than the 
  1.23  company's flat rate for an access line for a residence in the 
  1.24  same local telephone service exchange.  When a company's flat 
  1.25  rates for businesses and residences are the same, the company 
  1.26  shall use the residential rate for service to schools under this 
  2.1   section.  The rate required under this section is available only 
  2.2   for a school that installs additional service that includes 
  2.3   access to basic telephone service from each classroom and other 
  2.4   areas within the school, as determined by the school board. 
  2.5      Subd. 2.  [BASIC AND ADVANCED TELECOMMUNICATION SERVICES.] 
  2.6   (a) Notwithstanding the provisions of sections 237.09, 237.14, 
  2.7   237.60, subdivision 3, and 237.74, each telephone company and 
  2.8   telecommunications carrier that provides local telephone service 
  2.9   in a service area that includes a school that has classes within 
  2.10  the range from kindergarten to grade 12 ~~or that includes~~, a 
  2.11  public library, or a telecommunication services purchasing 
  2.12  cooperative may provide, upon request, basic and advanced 
  2.13  telecommunication services at reduced or no cost to that 
  2.14  school ~~or~~, library, or may provide, upon request, advanced 
  2.15  telecommunication services at wholesale rates or no cost to the 
  2.16  members of a telecommunication services purchasing cooperative.  
  2.17  For purposes of this section, a "telecommunication services 
  2.18  purchasing cooperative" means a cooperative organized under 
  2.19  section 308A.210.  A school or library receiving 
  2.20  telecommunications services at reduced or no cost may not resell 
  2.21  or sublease the discounted services.  No members of a 
  2.22  telecommunication services purchasing cooperative may resell or 
  2.23  sublease the discounted services.  A purchasing cooperative is 
  2.24  not required to negotiate or provide a uniform rate for its 
  2.25  members.  Telecommunications services shall be provided in 
  2.26  accordance with Public Law Number 104-104, and the regulations 
  2.27  of the Federal Communications Commission adopted under the act.  
  2.28     (b) An agent that provides telecommunications services to a 
  2.29  school or library may request the favorable rate on behalf of 
  2.30  and for the exclusive benefit of the school or library.  The 
  2.31  school or library must authorize the agent to make the request 
  2.32  of the local telephone company or telecommunications carrier.  
  2.33  The telephone company or telecommunications carrier is not 
  2.34  required to offer the same price discount to the agent that it 
  2.35  would offer to the school district or library.  An agent that 
  2.36  receives a price discount for telecommunications services on 
  3.1   behalf of a school or library may only resell or sublease the 
  3.2   discounted services to that school or library. 
  3.3      (c) For the purposes of this subdivision, "school" includes 
  3.4   a public school as defined in section 120.05, nonpublic, and 
  3.5   church or religious organization schools that provide 
  3.6   instruction in compliance with sections 120.101 to 120.102. 
  3.7      Sec. 2.  [308A.210] [TELECOMMUNICATION SERVICES PURCHASING 
  3.8   COOPERATIVES.] 
  3.9      Subdivision 1.  [PURPOSE; TERRITORY.] A telecommunication 
  3.10  services purchasing cooperative may be formed under this chapter 
  3.11  for the sole purpose of purchasing advanced telecommunications 
  3.12  services by aggregating demand and negotiating reduced rates for 
  3.13  its members.  Any such telecommunication services shall be 
  3.14  provided and directly billed by a telephone company or a 
  3.15  telecommunication carrier.  A purchasing cooperative must 
  3.16  declare in its articles of incorporation a contiguous area 
  3.17  comprising less than the entire state in which it may operate. 
  3.18     Subd. 2.  [LOCAL GOVERNMENT UNITS.] In addition to others 
  3.19  that may form a cooperative, a political subdivision of the 
  3.20  state, including a service cooperative created under section 
  3.21  123.582, may act to organize a telecommunication services 
  3.22  purchasing cooperative within its jurisdiction for the benefit 
  3.23  of its residents. 
  3.24     Subd. 3.  [POWERS.] A purchasing cooperative has all of the 
  3.25  powers described in section 308A.201, except that a purchasing 
  3.26  cooperative does not have the power of eminent domain.  A 
  3.27  purchasing cooperative is not a telephone or electric 
  3.28  cooperative as those terms are used in this chapter and chapters 
  3.29  216B and 237. 
  3.30     Subd. 4.  [GOVERNING BOARD.] A board of directors of five 
  3.31  to seven members shall govern a telecommunication services 
  3.32  purchasing cooperative.  The directors must be elected according 
  3.33  to the requirements of section 308A.311, except that: 
  3.34     (1) all of the directors must be members of the purchasing 
  3.35  cooperative; 
  3.36     (2) a director may not be a provider of services to the 
  4.1   cooperative or an employee of the provider; 
  4.2      (3) a director may not be a member of a governing body of a 
  4.3   political subdivision; and 
  4.4      (4) a majority of the directors must be seeking to purchase 
  4.5   some residential telecommunication services through the 
  4.6   cooperative. 
  4.7      Subd. 5.  [RESIDENTIAL MEMBERSHIP REQUIREMENT.] In order to 
  4.8   ensure that residential customers experience the benefits of 
  4.9   cooperative purchasing, at least 50 percent of the total number 
  4.10  of entities or individuals who are members of the purchasing 
  4.11  cooperative must be seeking to purchase residential 
  4.12  telecommunication services through the cooperative.  If the 
  4.13  telecommunication services purchasing cooperative fails to 
  4.14  comply with this subdivision, it shall notify the department of 
  4.15  public service and shall have one year from the date of 
  4.16  noncompliance to come into compliance.  If it does not come into 
  4.17  compliance, the telecommunication services purchasing 
  4.18  cooperative shall be dissolved and its assets distributed to its 
  4.19  members. 
  4.20     Subd. 6.  [FILINGS WITH DEPARTMENT OF PUBLIC SERVICE.] A 
  4.21  purchasing cooperative must immediately file a copy of its 
  4.22  contracts with telecommunication services providers with the 
  4.23  department of public service.  A purchasing cooperative must 
  4.24  file its annual financial statements with the department. 
  4.25     Subd. 7.  [OPEN MEMBERSHIP.] Any person within the 
  4.26  geographic operating area declared in a cooperative's articles 
  4.27  of incorporation or any person within the exchange boundary or 
  4.28  service area of a telephone company or telecommunication carrier 
  4.29  that in whole or in part is included in the geographic operating 
  4.30  area declared in the cooperative's articles of incorporation may 
  4.31  become a member of the telecommunication services purchasing 
  4.32  cooperative. 
  4.33     Subd. 8.  [ADVANCED TELECOMMUNICATION SERVICES; 
  4.34  DEFINED.] "Advanced telecommunications service" includes any 
  4.35  service that would be classified as a flexibly priced service 
  4.36  within the meaning of section 237.761, subdivision 4, or 
  5.1   nonprice regulated service within the meaning of section 
  5.2   237.761, subdivision 4, provided that a service may be an 
  5.3   advanced telephone service whether or not the telephone company 
  5.4   has adopted an alternative rate plan within the meaning of 
  5.5   section 237.76.