1998 Minnesota Statutes

     237.16 Local exchange competition, rules. 

    Subdivision 1.    New service, certificate of authority. 
  (a) For the purpose of bringing about fair and reasonable 
 competition for local exchange telephone services, the 
 commission has the exclusive authority, subject to the authority 
 of a local government unit under sections 237.162 and 237.163, 
 to: 

    (1) authorize any person to construct telephone lines or 
 exchanges or to otherwise furnish local service to subscribers 
 in any municipality of this state, and to prescribe the terms 
 and conditions upon which construction or service delivery may 
 be carried on; and 

    (2) establish terms and conditions for the entry of 
 telephone service providers so as to protect consumers from 
 monopolistic practices and preserve the state's commitment to 
 universal service.  

    (b) No person shall provide telephone service in Minnesota 
 without first obtaining a determination that the person 
 possesses the technical, managerial, and financial resources to 
 provide the proposed telephone services and a certificate of 
 authority from the commission under terms and conditions the 
 commission finds to be consistent with fair and reasonable 
 competition, universal service, the provision of affordable 
 telephone service at a quality consistent with commission rules, 
 and the commission's rules.  

    (c) The commission shall make a determination on an 
 application for a certificate within 120 days of the filing of 
 the application.  

    Subd. 2. Repealed by amendment, 1995 c 156 s 5 

    Subd. 3.    Map.  Every company authorized to provide 
 local telephone service under this section shall file a 
 territorial map.  The map must comply with the rules prescribed 
 by the commission.  

    Subd. 4.    Amended certificate required for expansion.  
 No company authorized to provide local service shall provide 
 local telephone service in any area for which it has not been 
 certified nor shall any person acquire ownership or control of 
 another telephone company either directly or indirectly, without 
 first obtaining from the commission an amended certificate of 
 authority.  The applicant for an amended certificate shall file 
 with the commission notice of the expansion or acquisition, 
 along with a new map under subdivision 3, identifying the 
 territory to be served.  Notice of the filing shall be served on 
 any affected municipality and local telephone company certified 
 in that territory.  If no objection is filed with the commission 
 by any interested party or raised by the commission within 20 
 days of the filing, it is considered approved, except if it 
 involves an acquisition governed by section 237.23, in which 
 case no certificate shall be granted until approval is obtained 
 pursuant to that section and subdivision 1.  If an objection is 
 filed, the commission shall determine whether to approve the 
 amendment in an expedited proceeding under section 237.61.  This 
 section shall not be construed to require a telephone company 
 operating an exchange in Minnesota to secure a certificate for 
 an extension within any territory within which such company has 
 heretofore filed maps or for substitute facilities within such 
 territories, or for extensions into territories contiguous to 
 that already occupied by such company and not receiving similar 
 service from another company if no certificate of territorial 
 authority has been issued to or applied for by any other company.

    Subd. 5.    Revocation and temporary suspension.  Any 
 certificate of authority may, after notice of hearing and a 
 hearing, be revoked or temporarily suspended by the commission, 
 in whole or in part, for:  the failure of its holder to furnish 
 reasonably adequate telephone service within the area or areas 
 determined and defined in the certificate of authority; failure 
 to meet the terms and conditions of its certificate; intentional 
 violation of the commission's rules or orders; or intentional 
 violation of any applicable state or federal law relating to the 
 provision of telephone or telecommunications services.  

    Subd. 6.    Expansion of service area not required.  
 This section does not require any telephone company providing 
 local service in the state of Minnesota to render telephone 
 service in any portion of any territorial area not included on 
 the telephone company's territorial map. 

    Subd. 7.    Existing certificate service continued.  
 This section does not limit the ability of telephone companies 
 possessing certificates of territorial authority on August 1, 
 1995, including, but not limited to, certificates authorizing 
 resale of local telephone service, to continue to provide 
 telephone service within their designated territories. 

    Subd. 8.    Rules.  (a) Before August 1, 1997, the 
 commission shall adopt rules applicable to all telephone 
 companies and telecommunications carriers required to obtain or 
 having obtained a certificate for provision of telephone service 
 using any existing federal standards as minimum standards and 
 incorporating any additional standards or requirements necessary 
 to ensure the provision of high quality telephone services 
 throughout the state.  The rules must, at a minimum: 

    (1) define procedures for competitive entry and exit; 

    (2) require the provisions of equal access and 
 interconnection with the company's network and other features, 
 functions, and services which the commission considers necessary 
 to promote fair and reasonable competition; 

    (3) require unbundling of network services and functions to 
 at least the level required by existing federal standards; 

    (4) prescribe, if necessary, methods of reciprocal 
 compensation between telephone companies; 

    (5) provide for local telephone number portability; 

    (6) prescribe appropriate regulatory standards for new 
 local telephone service providers, that facilitate and support 
 the development of competitive services; 

    (7) protect against cross-subsidization, unfair 
 competition, and other practices harmful to promoting fair and 
 reasonable competition; 

    (8) prescribe methods for the preservation of universal and 
 affordable local telephone services; 

    (9) prescribe standards for quality of service; 

    (10) provide for the continued provision of local emergency 
 telephone services under chapter 403; and 

    (11) protect residential and commercial customers from 
 unauthorized changes in service providers in a competitively 
 neutral manner. 

    (b) Before January 1, 1998, in a separate rulemaking, the 
 commission shall adopt separate rules regarding the issues 
 described in paragraph (a), clauses (1) to (11), as may be 
 appropriate to provision of competitive local telephone service 
 in areas served by telephone companies with less than 50,000 
 subscribers originally certified to provide local telephone 
 services before January 1, 1988.  

    Subd. 9.    Universal service fund.  The commission 
 shall establish and require contributions to a universal service 
 fund, to be supported by all providers of telephone services, 
 whether or not they are telephone companies under section 
 237.01, including, but not limited to, local telephone 
 companies, independent telephone companies, cooperative 
 telephone companies, municipal telephone companies, 
 telecommunications carriers, radio common carriers, personal 
 communication service providers, and cellular carriers.  
 Services that should be considered for inclusion as universal 
 include, at a minimum, single-party service including access, 
 usage and touch-tone capability; line quality capable of 
 carrying facsimile and data transmissions; equal access; 
 emergency services number capability; statewide 
 telecommunications relay service for the hearing-impaired; and 
 blocking of long-distance toll services.  The fund must be 
 administered and distributed in accordance with rules adopted by 
 the commission and designed to preserve the availability of 
 universal service throughout the state.  Any state universal 
 service fund must be coordinated with any federal universal 
 service fund and be consistent with section 254(b)(1) to (5) of 
 the federal Telecommunications Act of 1996, Public Law Number 
 104-104.  The department shall make recommendations to the 
 legislature by January 1, 1996, regarding a plan for 
 contributions to and expenditures from the universal service 
 fund.  In particular, the department shall address the following 
 issues: 

    (1) what additional services should be included in the 
 basic set of essential telephone services which the state should 
 encourage in its mandate to ensure universal service; 

    (2) whether and how expenditures from the fund should be 
 used to ensure citizens access to local government and other 
 public access programming; and 

    (3) whether expenditures from the fund should be used to 
 encourage construction of infrastructure for, and access to, 
 advanced services, especially in high-cost areas of the state, 
 and, if the commission determines the fund should be used for 
 this purpose, a plan to accomplish these goals.  

    Subd. 10.    Interim authority.  (a) Before adopting the 
 rules required under subdivision 8, the commission shall grant 
 an applicant a certificate to provide a proposed local telephone 
 service when the commission finds that the applicant meets the 
 conditions of subdivision 1.  Any applicant for a certificate 
 pursuant to subdivision 1 shall, at the time its application is 
 filed, provide notice of its application to all local telephone 
 companies authorized to provide local exchange service in the 
 geographic area identified in the application.  The applicant 
 and telephone companies shall negotiate a temporary arrangement 
 pertaining to interconnection matters for the effective 
 interconnection of local exchange networks, pending the adoption 
 of the rules under subdivision 8.  If the applicant and the 
 telephone companies fail to reach agreement within 60 days of 
 filing the application, the commission shall set the terms of 
 the temporary arrangement at the time of the issuance of the 
 certificate. 

    (b) Any company previously certified to provide local 
 telephone services may request a temporary arrangement for the 
 effective interconnection with the local exchange network of 
 another telephone company in the same territory, pursuant to the 
 time frames and procedures of this subdivision. 

    (c) In addition, through and until the rules are adopted 
 under subdivision 8, each telephone company serving more than 
 50,000 access lines in the state shall: 

    (1) permit interconnection or discontinue interconnection 
 for intrastate services to the same extent and in the same 
 manner and time frame as the Federal Communications Commission 
 requires interconnection or permits discontinuance of 
 interconnection for interstate services; and 

    (2) unbundle its intrastate services and facilities used 
 for intrastate services to the same extent and in the same 
 manner as the Federal Communications Commission requires 
 unbundling for interstate purposes. 

    Subd. 11.    Interim authority in area served by small 
 telephone company.  (a) Before adopting the rules required 
 under subdivision 8 for telephone companies with less than 
 50,000 subscribers, when an applicant requests certification to 
 provide local telephone service in an area served by a telephone 
 company with less than 50,000 subscribers originally certified 
 to provide local telephone service before January 1, 1988, the 
 commission shall grant the application if it finds the applicant 
 meets the requirements of subdivision 1.  The commission shall 
 make its determination on the application, including whether to 
 provide a temporary arrangement for the effective 
 interconnection of the local exchange networks, after a hearing 
 under chapter 14 or expedited proceeding under section 237.61, 
 within nine months of the application, and considering any facts 
 unique to that telephone company.  In addition, if an 
 application is granted, that telephone company shall: 

    (1) permit interconnection or discontinue interconnection 
 for intrastate services to the same extent and in the same 
 manner and time frame as the Federal Communications Commission 
 may thereafter require for that small telephone company for 
 interstate purposes; and 

    (2) unbundle its intrastate services and facilities used 
 for intrastate services to the same extent and in the same 
 manner as the Federal Communications Commission may thereafter 
 require for that telephone company for interstate purposes. 

    (b) If a telephone company with less than 50,000 
 subscribers is authorized by the Federal Communications 
 Commission to provide video common carrier services before the 
 rules required under subdivision 8 are adopted, an application 
 under this subdivision for certification to provide local 
 telephone service in an area served by that telephone company 
 shall be determined within 120 days of its filing. 

    Subd. 12.    Extension of interexchange facility.  In 
 order to promote the development of competitive interexchange 
 services and facilities, any interexchange facility that is 
 owned by a certified telephone company, independent telephone 
 company, telecommunications carrier or an affiliate and that is 
 used to provide service to customers located in areas for which 
 it has been previously certified to provide service may be 
 extended to meet and interconnect with the facility of another 
 telephone company, small telephone company, or 
 telecommunications carrier, whether at a point inside or outside 
 of its territories, without further proceeding, order, or 
 determination of current or future public convenience and 
 necessity, upon mutual consent with the other telephone company, 
 small telephone company, or telecommunications carrier whose 
 facilities will be met and interconnected.  Written notice of 
 the extension and interconnection must be provided to the public 
 utilities commission and department of public safety within 30 
 days after completion.  The written notice must be served on all 
 local exchange companies certified before January 1, 1988, in 
 all areas where the facilities are located.  

    Subd. 13.    Application of other law.  Notwithstanding 
 any provisions of sections 237.035 and 237.74 to the contrary, 
 before adopting the rules under subdivision 8, the local 
 services provided by a telecommunications carrier are subject to 
 this chapter in the same manner as those local services of a 
 telephone company regulated under this chapter, except that the 
 telecommunications carrier is not subject to section 237.22 and 
 is not subject to rate-of-return regulation or earnings 
 investigations under section 237.075 or 237.081.  Before 
 offering a local telephone service a telecommunications carrier 
 must be certified to provide local service under this section.  

    HIST: (5299) 1915 c 152 s 13; 1925 c 184 s 1; 1961 c 637 s 1; 
 1971 c 25 s 67; 1980 c 614 s 123; 1985 c 248 s 70; 1987 c 340 s 
 22; 1995 c 156 s 5; 1996 c 305 art 1 s 56; 1996 c 340 s 1; 1997 
 c 68 s 2; 1997 c 123 s 2; 1997 c 223 s 7 

*   NOTE:  The amendment to this section by Laws 1995, chapter 
*156, section 5, expires January 1, 2006.  Laws 1995, chapter 
*156, section 25.