1997 Minnesota Statutes

     237.60 Rates; competitive services. 

    Subdivision 1.    Effective competition.  A company 
 whose service has been determined by the commission to be 
 subject to effective competition may:  

    (1) decrease the rate for that service effective without 
 notice to its customers or the commission; and 

    (2) increase the rate for that service effective upon 
 notice to its customers at least 30 days in advance of the 
 increase.  

    A company whose service is declared subject to effective 
 competition is not subject to the requirements of section 
 237.07, subdivision 1, for that service.  

    Subd. 2.    Emerging competition.  (a) A company may 
 decrease the rate for a service subject to emerging competition 
 that is listed in the price list, effective ten days after 
 filing a new price list with the commission and the department, 
 along with an incremental cost study demonstrating that the new 
 price is above incremental cost.  The commission shall prevent a 
 proposed price reduction from going into effect or prospectively 
 reinstate the original rate if the reduction has gone into 
 effect if, after receiving a complaint or on its own motion, 
 under section 237.081, the commission finds that the new rate is 
 below incremental cost or that the new rate is not just and 
 reasonable. 

    (b) A company may increase the rate for a service subject 
 to emerging competition that is listed in the price list 
 effective 30 days after notice is given to affected customers, 
 the commission, and the department.  The notice and new price 
 list filing to the commission and the department for a rate 
 increase must include an incremental cost study demonstrating 
 that the proposed price is above incremental cost, unless a cost 
 study for the service has been filed within the past three years 
 and the company certifies that the cost study remains 
 appropriate for setting rates.  However, the commission may 
 order a new cost study upon showing that the most recent cost 
 study is inadequate.  

    An interested party may file comments on the proposed rate 
 increase within 30 days of the filing.  If no party objects to 
 the increase within that time, the rate is deemed approved.  If 
 an objection is filed, the rate increase must nonetheless be 
 deemed approved unless within 60 days of the date of the filing 
 the commission determines that the increase is potentially 
 contrary to the public interest.  In that event, the commission 
 shall, within 60 days after the date of the filing, order that 
 the rate increase is interim in nature and subject to refund.  
 If interim rates are not ordered, the rate increase is not 
 refundable.  If a rate is subject to refund, the commission, 
 after a contested case hearing or an expedited hearing under 
 section 237.61, must make a final decision regarding the 
 propriety of the rate increase within six months of the date the 
 price change was filed, except that if a contested case hearing 
 before an administrative law judge is required the commission 
 shall make a final decision within ten months of the date the 
 price change was filed.  If the commission does not do so, the 
 price change is deemed approved. 

    (c) If language describing a rate, term, or condition of 
 service in a price list is changed without substantially 
 altering the application of the price list, the change may take 
 effect upon one-day notice to the commission. 

    (d) If a term or condition of service in a price list is 
 changed in a way that results in a substantial change in the 
 application of the price list, but the price is not changed, the 
 change in the price list is effective at the same time as a 
 price decrease under paragraph (a). 

    (e) If a new pricing plan is proposed for a service that is 
 currently offered by a telephone company, the change in the 
 price list is subject to the same schedules governing a price 
 increase under paragraph (b).  For purposes of this paragraph, a 
 new pricing plan is a proposal that bundles rate elements for a 
 service, alters the definition of the rate elements for a 
 service, or includes increases for some rate elements and 
 decreases for other rate elements. 

    (f) A telephone company may offer a new service to its 
 customers ten days after it files a price list and incremental 
 cost study for the service with the department and the 
 commission. 

    (g) A telephone company may discontinue a telephone service 
 that is subject to emerging competition, as long as the 
 discontinuance is effective for that service throughout the 
 state, effective 60 days after notice to the commission, the 
 department, and affected customers, unless the commission, 
 within 45 days of the notice, orders a hearing on it.  If the 
 commission orders a hearing, the commission shall make a final 
 determination on the discontinuance within 180 days of the date 
 that notice of the discontinuance was filed with the commission, 
 except that if a contested case hearing before an administrative 
 law judge is required the commission shall make a final decision 
 within ten months of the date the notice of discontinuance was 
 filed. 

    (h) A change in a price list not covered by paragraphs (a) 
 to (f) must be reviewed according to the schedule prescribed for 
 a price increase under paragraph (b). 

    (i) An incremental cost study required by this section, 
 section 237.62, and 237.626, must be a long-run incremental cost 
 study unless the commission has allowed the telephone company 
 required to do the study to set rates based on a variable cost 
 study.  A telephone company may include a petition to file a 
 variable cost study instead of a long-run incremental cost study 
 with its notice of price change, notice of a promotion, or its 
 filing of a new service.  The commission shall grant the 
 petition if the company demonstrates that a long-run incremental 
 cost study is burdensome in relation to its annual revenue from 
 the service involved, that the company has a low market share, 
 that the service is no longer being offered to new customers, or 
 if the company shows other good cause.  A petition must be 
 accompanied by a variable cost study.  If the petition is 
 denied, the company shall withdraw a filing made under this 
 section. 

    (j) For purposes of this section and section 237.62, (1) 
 long-run incremental cost means the change in total cost 
 associated with a change in volume of the service, expressed on 
 a per-unit basis, and (2) variable cost means the change in 
 total cost, excluding fixed costs, associated with a change in 
 volume of service, expressed on a per-unit basis. 

    Subd. 3.    Discrimination.  No telephone company shall 
 offer telecommunications service within the state upon terms or 
 rates that are unreasonably discriminatory.  No telephone 
 company shall unreasonably limit its service offerings to 
 particular geographic areas unless facilities necessary for the 
 service are not available and cannot be made available at 
 reasonable costs.  The rates of a telephone company must be the 
 same in all geographic locations of the state unless for good 
 cause the commission approves different rates.  A company that 
 offers long-distance services shall charge uniform rates and 
 charges on all long-distance routes and in all geographic areas 
 in the state where it offers the services.  However, a company 
 may offer or provide volume discounts in connection with 
 intrastate long-distance services and may pass through any 
 state, municipal, or local taxes in the specific geographic 
 areas from which the taxes originate.  Nothing in this 
 subdivision authorizes a telephone company to provide service 
 outside of its authorized service area except as provided in 
 section 237.16. 

    Subd. 4.    Cost of service.  Prices or rates charged 
 for competitive services must cover the incremental costs of 
 providing the service.  If a telephone company provides both 
 local service and long-distance services, that company shall, in 
 determining the cost of the long-distance service, include at 
 least the same level of contribution to common and joint costs 
 as is contained in the access charges to other telephone 
 companies.  The company may do so on an aggregate basis, instead 
 of on a time or mileage band basis. 

    Subd. 5.    Complaints.  Competitive services are 
 subject to the complaint procedures of section 237.081.  In a 
 complaint proceeding, the company providing the service bears 
 the burden of proving that the prices charged cover its 
 incremental costs and a reasonable contribution to the common 
 and joint costs of the company and are fair, just, and 
 reasonable. 

    HIST: 1987 c 340 s 4; 1989 c 74 s 13,14; 1992 c 493 s 7; 1994 
 c 465 art 1 s 28; 1994 c 534 art 1 s 10 

*   NOTE:  See section 237.5799