FCC Record, Volume 2, No. 1, Pages 1 to 409, January 5 - January 16, 1987 Page: 31

Federal Communicatio CommCommission Record

IXCs should be provided the option of being billed
an average CCL charge for originating traffic in the
operating territory of a LEC proposing an interim
NTS plan. This would preserve IXCs' abilities to
maintain nationwide rate schedules. LECs also
should be required to ensure that IXCs may resell
access under interim NTS plans.
Proposed direct end user charge plans should provide
for multiple IXC billing of end user charges.
This would mitigate customer confusion, MCI contends,
because by allowing each of an end user's
DCCs to bill only the charges associated with its
calls, the end user will be provided with the simplest
bills possible.38 MCI also requests that the
effective date of an interim NTS tariff be deferred
up to one year in order to allow IXCs to adjust
their billing systems.
LECs providing interstate services, such as corridor
services, must apply the terms of their alternative
NTS plans to their interstate services.9
23. ALC and ADAPSO filed comments in support of
the API, Ad Hoc, and MCI petitions for reconsideration.
ALC's comments relate primarily to MCI's petition. ALC
expressed support for a number of MCI's requests for
clarification of aspects of the Guidelines Order, including
the request that LECs filing waiver petitions demonstrate
current and future harm resulting from uneconomic bypass.40
ADAPSO's comments relate primarily to the API
and Ad Hoc petitions. ADAPSO expresses support for the
procedural arguments raised by these petitioners.
24. Bell Atlantic, BellSouth, GTE, and NYNEX filed
comments opposing the petitions of API, Ad Hoc, Federal
Agencies, and MCI. U.S. West filed comments in opposition
to MCI's petition. Essentially, these LECs make three
assertions: (1) this Commission's use of the waiver procedure
was not only appropriate, but afforded interested
parties as much or more opportunity to participate than
would have been afforded in a rulemaking proceeding; (2)
substantial uneconomic bypass activity continues, and
LECs need pricing flexibility to combat such bypass; and
(3) the modifications to the GuidelinesOrder requested by
the petitioners are unwarranted and would virtually
eliminate the possibility that interim NTS plans could be
implemented.
25. According to the LECs, there is no merit to claims
that the Guidelines Order is procedurally defective. They
assert that waiver, rather than rulemaking procedures,
were appropriate because the Guidelines Order neither
changes existing Part 69 rules nor creates a new right for
LECs to seek waiver of such rules. The right to seek a
waiver, they note, already is an established part of this
Commission's rules.41 The Guidelines Order, these parties
claim, merely sets forth the minimum showing a LEC
must make in exercising that right to support waiver of
the current rules.42 Moreover, these parties contend that a
waiver, rather than a rulemaking proceeding, is an appropriate
forum for consideration of interim NTS plans for
several reasons.43 First, the relief available under the
order is limited to the single section of Part 69 pertaining
to CCL recovery. Therefore, the order does not generally
eviscerate the access rules and does not represent a determination
that such rules are generally invalid. Second, by
the terms of the order, waivers will be granted only on a
temporary basis
a single year. Third, the order does not

approve any particular proposal. Any LEC seeking to
implement an interim NTS plan still must file a waiver
petition and tariff revisions, both of which will be presented
for public comment.
26. The LECs also contest the petitioners' claim that
bypass is an insufficient basis for permitting LECs to
implement interim NTS plans. According to the LECs, it
is a matter of well established record that the loading of
NTS common line costs onto usage-based TS access rates
establishes an uneconomic incentive to bypass local
switched services. The impact of this loading also is substantial,
the LECs claim. Bell Atlantic, for example, purports
to demonstrate how such loadings increase the cost
of its switched services by nearly 150 percent." U.S. West
asserts that since NTS common line costs are by definition
end-user-specific costs, their recovery from IXCs on a
usage-sensitive basis creates obvious incentives for customers
to leave the switched network in search of alternative
transmission services that carry no NTS burden.45
Moreover, the LECs assert, it was not necessary for the
Commission to determine specifically the current amount
of uneconomic bypass activity in order to support a
finding that "good cause" exists for granting waivers. Such
a finding was not required, the LECs claim. because no
waiver petitions were granted in the course of the Guidelines
Order proceeding.
27. Several LECs contend that the decision in the
Guidelines Order to permit the recovery of some common
line costs through a surcharge on special access lines is
proper and should not be reconsidered. These LECs agree
with the petitioners' claim that such surcharges will uneconomically
load costs onto special access that are unrelated
to the provision of such services, but the LECs
assert that this claim is irrelevant.46 The surcharge concept
is reasonable, the LECs claim, because it satisfies an
important policy goal
namely, the mitigation of uneconomic
bypass incentives resulting from the distorted price
relationship between switched access rates burdened by
CCL NTS costs and special access rates that do not carry
such a burden. The LECs also contest the petitioners'
claim that the surcharge should not be applied to special
access lines that do not "leak" traffic into the local
exchange. According to the LECs, this claim fails to
reflect the fact that the purpose of the surcharge
to
balance the burden of NTS CCL recovery
is unrelated
to whether or not particular special access lines leak
traffic into the local exchange.47
28. Finally, the LECs contend that it would be inappropriate
for this Commission to modify the waiver guidelines
as requested by the petitioners. As a general matter,
the LECs assert, granting these requests would require this
Commission to anticipate the specifics of proposals not
yet filed and foreclose them out-of-hand.48 The LECs also
contend that such modifications would make it virtually
impossible to implement an interim NTS plan. U.S. West
claims, for example, that interim NTS plans conforming
to the direct end user charge model would be unworkable
if IXCs were provided the option of being billed an
average CCL charge for originating traffic.49 NYNEX argues
that it is not possible to provide for multiple IXC
billing under the end user charge model because the
tapered charges established under the plan are applied to
an end-users aggregated minutes, and it is impossible to
identify the revenues associated with each IXCs' minutes
as they pass through the taper.50 Bell Atlantic asserts that
the bypass data requirements the petitioners seek to im31