Transport Rate Structure and Pricing

FEDERAL COMMUNICATIONS COMMISSION

47 CFR Parts 61 and 69

[CC Docket No. 91-213, FCC 94-9]

Transport Rate Structure and Pricing

AGENCY: Federal Communications Commission.

ACTION: Final rule.

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SUMMARY: This order modifies certain features of the price cap

regulatory system applicable to local exchange carriers (LECs) to

complement the FCC's recent restructure of the LECs' local transport

rates. Specifically, the order moves transport services, including all

the transmission-related elements, the tandem switching charge, and the

interconnection charge, out of the price cap basket for traffic

sensitive services, and places them into a combined ``trunking'' basket

containing transport and special access services. The order realigns

the service categories and subcategories within the trunking basket,

and adapts the pricing bands applicable to these categories and

subcategories, to reflect the similarities between certain special

access and flat-rated transport services, and to accommodate the new

density zone pricing system that the Commission adopted for both

special access and transport. These rule changes encourage the LECs to

align their transport rates to reflect more closely how costs are

incurred, thus promoting more efficient usage and deployment of the

country's telecommunications networks, advancing competition in both

the long-distance and local access markets, and ultimately reducing

access charges and long-distance rates and stimulating the economy by

increasing demand for these services.

EFFECTIVE DATE: March 4, 1994.

FOR FURTHER INFORMATION CONTACT:

David L. Sieradzki, Common Carrier Bureau, Policy & Program Planning

Division, 202-632-1304.

SUPPLEMENTARY INFORMATION: This is a synopsis of the Commission's

Second Report and Order in CC Docket No. 91-213, adopted on January 19,

1994 and released on January 31, 1994. The complete text of this Second

Report and Order is available for inspection and copying during normal

business hours in the FCC Reference Center, 1919 M St. NW., room 230,

Washington, DC 20554.

Synopsis of Second Report and Order

1. The Commission adopts its proposal to remove the transport

service categories from the traffic sensitive basket and place them

into a combined basket that also contains special access services. The

Commission renames this merged basket the ``trunking basket.'' The

Commission is placing the tandem switching charge in the newly formed

trunking basket, and keeping it in the same service category as tandem-

switched transport. The Commission is placing the interconnection

charge service category in the trunking basket.

2. The Commission is adopting a modified version of its proposal in

the Further Notice in this proceeding, 57 FR 54205 (Nov. 17, 1992), on

the arrangement of service categories within the newly formed trunking

basket. The Commission concludes that flat-rated transport (entrance

facilities, direct-trunked transport, and dedicated signalling

transport) should be incorporated into the corresponding special access

service categories. Thus, demand for voice grade flat-rated transport

will be assigned to the existing voice grade-WATS-metallic-telegraph

service category in the current special access basket for the purposes

of computing the service band index (SBI) and pricing bands for that

category. Demand for DS1 and DS3 flat-rated transport will be assigned,

respectively, to the DS1 and DS3 subcategories of the high capacity-DDS

service category in the current special access basket for purposes of

computing the SBIs and bands for those subcategories. Tandem-switched

transport (including the tandem switching element) and the

interconnection charge will be separate service categories in the

trunking basket.

3. The Commission concludes that the density pricing zone

subcategories within the flat-rated transport service category should

be incorporated into the existing zone subcategories within the

existing DS3 and DS1 special access subcategories, with one exception.

In some cases, a LEC might implement density zone pricing for transport

in a different tariff year than it implemented density zone pricing for

special access. In such circumstances, the Commission will require LECs

to retain separate zone bands for special access and flat-rated

transport services until the end of the tariff year following the

tariff year in which density pricing was implemented for the later

service. After that time, the zone bands for special access and

transport can be consolidated.

4. The Commission is not modifying the pricing bands applicable to

the transport or special access service categories at this time. The

service category bands constrain the LECs' ability to offset rate

reductions in some categories with rate increases in other categories.

5. The Commission is setting forth the details of establishing the

indexes and banding limits for the new trunking basket and the

realigned service categories within that basket. First, the 2% upper

and 5% lower bands for tandem-switched transport and the 0% upper band

for the interconnection charge apply to changes from the initial rates

for these services as of the transport rate restructure, regardless of

whether the LECs raised or lowered their local transport rates prior to

the rate restructure. (``Initial rates'' refers to the rates that

became effective as a result of the September 1, 1993 initial

restructured transport tariff filing, or rates that subsequently go

into effect as the result of the mid-course correction.) Thus, the LECs

should set their initial bands and SBIs for the tandem-switched

transport and interconnection charge service categories using the

baseline of the initial restructured rate levels.

6. Because 47 CFR part 61 does not explicitly address the manner in

which service categories are to be merged, the Commission adopts

transition rules governing how the initial banding limits and indexes

should be set for the new trunking basket and the realigned service

categories within that basket. The initial degree of pricing

flexibility for the trunking basket will be set by taking into account

both the pricing flexibility currently available in the special access

basket and the pricing flexibility available in the traffic sensitive

basket (which currently includes transport). Thus, while the pre-

existing actual price index (API) for the special access basket will be

used as the initial API for the trunking basket, the PCI for the

trunking basket should be set as follows. LECs should calculate the

ratio between the pre-existing PCI for the special access basket and

the API for that basket, and the ratio between the pre-existing PCI for

the traffic sensitive basket and the API for that basket. A weighted

average of these ratios should be derived using the base period revenue

weights of the special access and transport services included in the

trunking basket, respectively. This weighted average should be

multiplied by the pre-existing API for the special access basket to

derive the PCI for the trunking basket. (Base period demand for flat-

rated transport elements (i.e., demand for the 1992 base year) should

correspond with the historical demand used in computing the initial

interconnection charge. The rates used in this formula should be the

rates effective on the date that the transport rate restructure became

effective, or rates that subsequently go into effect as the result of

the mid-course correction.)

7. Similarly, adjustments to the upper and lower pricing bands

applicable to the existing voice grade and high capacity/DDS service

categories and the DS1 and DS3 subcategories are necessary to reflect

the incorporation of comparable flat-rated transport rate elements.

While the SBIs for these categories are to remain the same, the upper

and lower bands should reflect a weighted average of the pre-existing

upper and lower bands for the special access services and the 5% upper

and lower bands for the flat-rated transport services. This weighted

average should be calculated using the base period revenue weights of

the special access and transport services included in each service

category and subcategory. A comparable procedure will be used to

incorporate transport services into a density pricing zone category

that has already been established for special access services (or vice

versa).

8. The changes adopted in the order necessitate adjustments to the

price cap indexes. Accordingly, the Commission directs all LECs subject

to the price cap rules to recalculate their price cap indexes pursuant

to the decisions in the order. The LECs should file such recalculated

indexes with the Commission in a special filing not accompanied by rate

changes. The Commission delegates authority to the Chief, Common

Carrier Bureau, to specify the format and timing of this filing. In

addition, such recalculated indexes should be used as the basis of any

price cap filing that changes rates of services in the trunking or

traffic sensitive baskets.

9. Finally, the Commission clarifies some miscellaneous

implementation matters. First, the Commission clarifies that its

decision in the Second Reconsideration Order, 58 FR 45266 (Aug. 27,

1993) (requiring use of historical demand for all components of the

formula for computing the inter-connection charge) applies only to

price cap LECs. Rate-of-return LECs continue to be subject to 47 CFR

61.38 and 61.39, and should continue to use projected demand to set

transport rates. Consistent with the First Reconsideration Order, 58 FR

41184 (Aug. 3, 1993), however, these projections should only forecast

demand growth, and should not attempt to forecast IXCs'

reconfigurations in response to the transport rate restructure. Second,

due to the difficulty of applying non-premium charges to flat-rate

transport elements, the Commission modifies its rules to clarify that

non-premium charges must be established only for the interconnection

charge, and not for the facility-based transport elements. Third, the

Commission modifies the rules to clarify that the LECs must waive

certain non-recurring charges for a six-month period following the

effective date of their restructured transport tariffs. Finally, the

Commission is making limited technical changes to 47 CFR part 69.

10. In the Further Notice in this proceeding, 57 FR 54205 (Nov. 17,

1992), the Commission certified that the proposed rule changes would

not have a significant economic impact on a substantial number of small

business entities, as defined by section 601(3) of the Regulatory

Flexibility Act. Neither the Chief Counsel for Advocacy of the Small

Business Administration nor any commenting party disagreed with that

analysis. The Secretary shall send a copy of this Report and Order,

including the certification, to the Chief Counsel for Advocacy of the

Small Business Administration in accordance with section 605(b) of the

Regulatory Flexibility Act, Public Law No. 69-354, 94 Stat. 1164, 5

U.S.C. 601 et seq. (1981).

Ordering Clauses

11. Accordingly, it is ordered that pursuant to authority contained

in sections 1, 4(i) and (j), 201-205, 220, and 403 of the

Communications Act of 1934, as amended, 47 U.S.C. Secs. 151, 154(i) and

(j), 201-205, 220, and 403, parts 61 and 69 of the Commission's rules

are Amended as set forth below.

12. It is further ordered that the policies and rules adopted

herein shall be effective upon publication in the Federal Register.

Because the initial restructured transport rates went into effect on

December 30, 1993, thus allowing LECs subject to price cap regulation

to propose rate changes that do not comply with the policies adopted

herein in the absence of these rule changes, good cause exists to make

these rules effective less than 30 days from publication in the Federal

Register.

13. It is further ordered that the Chief, Common Carrier Bureau is

delegated the authority specified herein.

List of Subjects in 47 CFR Parts 61 and 69

Communications common carriers, Reporting and recordkeeping

requirements. Telephone.

Federal Communications Commission.

William F. Caton,

Acting Secretary.

Amendatory Text

47 CFR parts 61 and 69 are amended as follows:

PART 61--TARIFFS

1. The authority citation for part 61 continues to read as follows:

Authority: Sec. 4, 48 Stat. 1066, as amended; 47 U.S.C. 154.

Interpret or apply sec. 203, 48 Stat. 1070; 47 U.S.C. 203.

2. Section 61.3 is amended by redesignating paragraphs (jj) and

(kk) as paragraphs (kk) and (ll), respectively, and adding a new

paragraph (jj), to read as follows:

Sec. 61.3 Definitions.

* * * * *

(jj) Tariff year. The period from the day in a calendar year on

which a carrier's annual access tariff filing is scheduled to become

effective through the preceding day of the subsequent calendar year.

* * * * *

3. Section 61.42 is amended by removing paragraphs (e)(1)(iii),

(e)(1)(iv), and (e)(1)(v); redesignating paragraphs (e)(1)(vi) and

(e)(1)(vii) as paragraphs (e)(1)(iii) and (e)(1)(iv), respectively;

revising paragraph (d)(3), redesignated paragraph (e)(1)(iii), the

introductory text of paragraph (e)(2), paragraph (e)(2)(i), paragraph

(e)(2)(iii), and paragraph (e)(2)(iv); and adding paragraphs (e)(2)(v)

and (e)(2)(vi), to read as follows:

Sec. 61.42 Price cap baskets and service categories.

* * * * *

(d) * * *

(3) A basket for trunking services as described in Secs. 69.110,

69.111, 69.112, 69.114, 69.124, and 69.125 of this chapter;

* * * * *

(e)(1) * * *

(iii) Data base access services; and

* * * * *

(2) The trunking basket shall contain such transport and special

access services as the Commission shall permit or require, including

the following service categories and subcategories:

(i) Voice grade entrance facilities, voice grade direct-trunked

transport, voice grade dedicated signalling transport, voice grade

special access, WATS special access, metallic special access, and

telegraph special access services;

* * * * *

(iii) High capacity flat-rated transport, high capacity special

access, and DDS services, including the following service

subcategories:

(A) DS1 entrance facilities, DS1 direct-trunked transport, DS1

dedicated signalling transport, and DS1 special access services; and

(B) DS3 entrance facilities, DS3 direct-trunked transport, DS3

dedicated signalling transport, and DS3 special access services;

(iv) Wideband data and wideband analog services;

(v) Tandem-switched transport, as described in Sec. 69.111 of this

chapter; and

(vi) Interconnection charge, as described in Sec. 69.124 of this

chapter.

* * * * *

4. Section 61.47 is amended as follows:

a. Paragraphs (f) and (g) are redesignated as paragraphs (f)(1) and

(f)(2).

b. Paragraph (h)(1) is redesignated as paragraph (g)(1).

(c) Paragraph (i) is redesignated as paragraph (g)(4).

d. Paragraphs (e)(2) and (e)(3) are redesignated as paragraphs

(g)(2) and (g)(3) and are revised.

e. Paragraph (h) is revised.

f. Headings are added to paragraphs (f) and (g).

g. The designation (1) in paragraph (e) is removed and paragraph

(e) is revised.

(h) Add the words ``or subcategories'' after the words ``service

categories'' in paragraphs (a) and (b).

i. Add the words ``or subcategory'' after the words ``service

category'' in paragraphs (a) and (c).

j. Remove the words ``Notwithstanding paragraphs (e) and (f) of

this section'' from redesignated paragraph (f)(2) and add in their

place ``Notwithstanding paragraph (f)(1) of this section''.

k. Remove the words ``Notwithstanding paragraph (e) of this

section,'' from redesignated paragraphs (g)(1) and (g)(4) and

capitalizing the word ``the'' in each sentence when the phrase is

removed.

As amended above, Sec. 61.47 reads as follows:

Sec. 61.47 Adjustments to the SBI; pricing bands.

* * * * *

(e) Pricing bands shall be established each tariff year for each

service category and subcategory within a basket. Except as provided in

paragraphs (f), (g), and (h) of this section, each band shall limit the

pricing flexibility of the service category or subcategory, as

reflected in its SBI, to an annual increase or decrease of five

percent, relative to the percentage change in the PCI for that basket,

measured from the levels in effect on the last day of the preceding

tariff year.

(f) Dominant interexchange carriers.

* * * * *

(g) Local exchange carriers--Service categories and subcategories.

* * * * *

(2) The upper pricing band for the tandem-switched transport

service category shall limit the annual upward pricing flexibility for

this service category, as reflected in its SBI, to two percent,

relative to the percentage change in the PCI for the trunking basket,

measured from the levels in effect on the last day of the preceding

tariff year. The lower pricing band for the tandem-switched transport

service category shall limit the annual downward pricing flexibility

for this service category, as reflected in its SBI, to five percent,

relative to the percentage change in the PCI for the trunking basket,

measured from the levels in effect on the last day of the preceding

tariff year.

(3) The upper pricing band for the interconnection charge service

category shall limit the annual upward pricing flexibility for this

service category, as reflected in its SBI, to zero percent, relative to

the percentage change in the PCI for the trunking basket, measured from

the levels in effect on the last day of the preceding tariff year.

There shall be no lower pricing band for the interconnection charge.

* * * * *

(h) Local exchange carriers--Density pricing zones.

(1) In addition to the requirements of paragraphs (g)(1) and (g)(2)

of this section, those local exchange carriers subject to price cap

regulation that have established density pricing zones pursuant to

Sec. 69.123 of this chapter shall use the methodology set forth in

paragraphs (a) through (d) of this section to calculate separate

subindexes in each zone for each of the following groups of services:

(i) DS1 entrance facilities, DS1 direct-trunked transport, DS1

dedicated signalling transport, and DS1 special access services;

(ii) DS3 entrance facilities, DS3 direct-trunked transport, DS3

dedicated signalling transport, and DS3 special access services;

(iii) Voice grade entrance facilities, voice grade direct-trunked

transport, and voice grade dedicated signalling transport, and (if the

Commission, by order, designates such services as subject to

competition) voice grade special access;

(iv) Tandem-switched transport; and

(v) Such other special access services that the Commission may

designate by order.

(2) The annual pricing flexibility for each of the subindexes

specified in paragraph (h)(1) of this section shall be limited to an

annual increase of five percent or an annual decrease of ten percent,

relative to the percentage change in the PCI for the trunking basket,

measured from the levels in effect on the last day of the preceding

tariff year.

5. Section 61.48 is amended by revising paragraphs (g) and (h) and

adding paragraph (i), to read as follows:

Sec. 61.48 Transition rules for price cap formula calculations.

* * * * *

(g) Local Transport Restructure--Initial Rates. Local exchange

carriers subject to price cap regulation shall set initial transport

rates, as defined in Sec. 69.2(tt) of this chapter, according to the

requirements set forth in Secs. 69.108, 69.110, 69.111, 69.112, 69.124,

and 69.125 of this chapter.

(h) Local Transport Restructure--Price Cap Transition Rules--(1)

Definitions. The following definitions apply for purposes of paragraph

(h) of this section:

Effective date is March 4, 1994.

Initial restructured rates are rates that are (or should have been)

effective on the transport restructure date;

Revenue weight of a given group of services included in a basket,

service category, or subcategory is the ratio of base period demand for

the given service rate elements included in the basket, service

category, or subcategory priced at initial restructured rates, to the

base period demand for the entire group of rate elements comprising the

basket, service category, or subcategory priced at initial restructured

rates; and

Transport restructure date is the date on which local exchange

carriers' initial transport rates, as defined in Sec. 69.2(tt) of this

chapter, became effective.

(2) Trunking Basket PCI and API. (i) On the effective date, the PCI

value for the trunking basket, as defined in Sec. 61.42(d)(3), shall be

computed by multiplying the API value for the special access basket on

the day preceding the transport restructure date, by a weighted average

of the following:

(A) The ratio of the PCI value that applied to the special access

basket on the day preceding the transport restructure date, to the API

value that applied to the special access basket on the day preceding

the transport restructure date, weighted by the revenue weight of the

special access services included in the trunking basket; and

(B) The ratio of the PCI value that applied to the traffic

sensitive basket on the day preceding the transport restructure date,

to the API value that applied to the traffic sensitive basket on the

day preceding the transport restructure date, weighted by the revenue

weight of the transport services included in the trunking basket.

(ii) On the effective date, the API value for the trunking basket

referred to in Sec. 61.42(e)(2) shall be equal to the API value for the

special access basket on the day preceding the transport restructure

date.

(3) Service Category and Subcategory Pricing Bands for Flat-Rated

Transport and Special Access. From the effective date through the end

of the tariff year, the following shall govern instead of

Secs. 61.47(e) and 61.47(g)(1). The pricing bands established for the

voice grade and high capacity service categories referred to in

Secs. 61.42(e)(2)(i) and 61.42(e)(2)(iii) and the DS1 and DS3 service

subcategories referred to in Secs. 61.42(e)(2)(iii)(A) and

61.42(e)(2)(iii)(B), shall limit the pricing flexibility of the service

category or subcategory, as reflected in its SBI, as follows:

(i) The upper pricing band shall be a weighted average of the

following:

(A) The upper pricing band that applied to the special access

services included in the category or subcategory on the day preceding

the transport restructure date, weighted by the revenue weight of the

special access services included in the category or subcategory; and

(B) 1.05 times the SBI value for the special access services

included in the category or subcategory on the day preceding the

transport restructure date, weighted by the revenue weight of the

transport services included in the category or subcategory.

(ii) The lower pricing band shall be a weighted average of the

following:

(A) The lower pricing band that applied to the special access

services included in the category or subcategory on the day preceding

the transport restructure date, weighted by the revenue weight of the

special access services included in the category or subcategory; and

(B) 0.95 times the SBI value for the special access services

included in the category or subcategory on the day preceding the

transport restructure date, weighted by the revenue weight of the

transport services included in the category or subcategory.

(iii) On the effective date, the SBI value for the category or

subcategory shall be equal to the SBI value for the corresponding

special access category or subcategory on the day preceding the

effective date.

(4) Tandem-Switched Transport and Interconnection Charge SBIs. On

the effective date, the SBIs for the tandem-switched transport and

interconnection charge service categories defined in Sec. 61.42(e)(2)

(v) and (vi) shall be assigned an initial value prior to adjustment of

100, corresponding to the initial restructured rates in those

categories.

(5) Tandem-Switched Transport and Interconnection Charge Service

Category Pricing Bands. From the effective date through the end of the

tariff year, the following shall govern instead of Sec. 61.47 (g)(2)

and (g)(3):

(i) The upper pricing band for the tandem-switched transport

service category shall limit the upward pricing flexibility for this

service category, as reflected in its SBI, to two percent, measured

from the initial restructured rates for tandem-switched transport. The

lower pricing band for the tandem-switched transport service category

shall limit the downward pricing flexibility for this service category,

as reflected in its SBI, to five percent, measured from the initial

restructured rates for tandem-switched transport.

(ii) The upper pricing band for the interconnection charge service

category shall limit the upward pricing flexibility for this service

category, as reflected in its SBI, to zero percent, measured from the

initial restructured rate for the interconnection charge.

(i) Transport and Special Access Density Pricing Zone Transition

Rules--(1) Definitions. The following definitions apply for purposes of

paragraph (i) of this section:

Earlier date is the earlier of the special access zone date and the

transport zone date.

Earlier service is special access if the special access zone date

precedes the transport zone date, and is transport if the transport

zone date precedes the special access zone date.

Later date is the later of the special access zone date and the

transport zone date.

Later service is transport if the special access zone date precedes

the transport zone date, and is special access if the transport zone

date precedes the special access zone date.

Revenue weight of a given group of services included in a zone

category is the ratio of base period demand for the given service rate

elements included in the category priced at existing rates, to the base

period demand for the entire group of rate elements comprising the

category priced at existing rates.

Special access zone date is the date on which a local exchange

carrier tariff establishing divergent special access rates in different

zones, as described in Sec. 69.123(c) of this chapter, becomes

effective.

Transport zone date is the date on which a local exchange carrier

tariff establishing divergent switched transport rates in different

zones, as described in Sec. 69.123(d) of this chapter, becomes

effective.

(2) Simultaneous Introduction of Special Access and Transport

Zones. Local exchange carriers subject to price cap regulation that

have established density pricing zones pursuant to Sec. 69.123 of this

chapter, and whose special access zone date and transport zone date

occur on the same date, shall initially establish density pricing zone

SBIs and bands pursuant to the methodology in Sec. 61.47(h).

(3) Sequential Introduction of Zones in the Same Tariff Year.

Notwithstanding Sec. 61.47(h), local exchange carriers subject to price

cap regulation that have established density pricing zones pursuant to

Sec. 69.123 of this chapter, and whose special access zone date and

transport zone date occur on different dates during the same tariff

year, shall, on the earlier date, establish density pricing zone SBIs

and pricing bands using the methodology described in Sec. 61.47(h), but

applicable to the earlier service only. On the later date, such

carriers shall recalculate the SBIs and pricing bands to limit the

pricing flexibility of the services included in each density pricing

zone category, as reflected in its SBI, as follows:

(i) The upper pricing band shall be a weighted average of the

following:

(A) The upper pricing band that applied to the earlier services

included in the zone category on the day preceding the later date,

weighted by the revenue weight of the earlier services included in the

zone category; and

(B) 1.05 times the SBI value for the services included in the zone

category on the day preceding the later date, weighted by the revenue

weight of the later services included in the zone category.

(ii) The lower pricing band shall be a weighted average of the

following:

(A) The lower pricing band that applied to the earlier services

included in the zone category on the day preceding the later date,

weighted by the revenue weight of the earlier services included in the

zone category; and

(B) 0.90 times the SBI value for the services included in the zone

category on the day preceding the later date, weighted by the revenue

weight of the later services included in the zone category.

(iii) On the later date, the SBI value for the zone category shall

be equal to the SBI value for the category on the day preceding the

later date.

(4) Introduction of Zones in Different Tariff Years.

Notwithstanding Sec. 61.47(h), those local exchange carriers subject to

price cap regulation that have established density pricing zones

pursuant to Sec. 69.123 of this chapter, and whose special access zone

date and transport zone date do not occur within the same tariff year,

shall, on the earlier date, establish density pricing zone SBIs and

pricing bands using the methodology described in Sec. 61.47(h), but

applicable to the earlier service only.

(i) On the later date, such carriers shall use the methodology set

forth in paragraphs (a) through (d) of Sec. 61.47 to calculate separate

SBIs in each zone for each of the following groups of services:

(A) DS1 special access services;

(B) DS3 special access services;

(C) DS1 entrance facilities, DS1 direct-trunked transport, and DS1

dedicated signalling transport;

(D) DS3 entrance facilities, DS3 direct-trunked transport, and DS3

dedicated signalling transport;

(E) Voice grade entrance facilities, voice grade direct-trunked

transport, and voice grade dedicated signalling transport;

(F) Tandem-switched transport; and

(G) Such other special access services as the Commission may

designate by order.

(ii) From the later date through the end of the following tariff

year, the annual pricing flexibility for each of the subindexes

specified in paragraph (i)(4)(i) of this section shall be limited to an

annual increase of five percent or an annual decrease of ten percent,

relative to the percentage change in the PCI for the trunking basket,

measured from the levels in effect on the last day of the tariff year

preceding the tariff year in which the later date occurs.

(iii) On the first day of the second tariff year following the

tariff year during which the later date occurs, the local exchange

carriers to which this paragraph applies shall establish the separate

subindexes provided in Sec. 61.47(h)(1), and shall set the initial SBIs

for those density pricing zone categories that are combined (specified

in paragraphs (i)(4)(i)(A) and (i)(4)(i)(C), (i)(4)(i)(B) and

(i)(4)(i)(D), and (i)(4)(i)(E) and (i)(4)(i)(G) of this section) by

computing the weighted averages of the SBIs that applied to the

formerly separate zone categories, weighted by the revenue weights of

the respective services included in the zone categories.

Sec. 61.49 [Amended]

6. Section 61.49(c) is amended by removing the cite

``Secs. 61.47(e) and (f)'' and adding, in their place, the cite

``Sec. 61.47(e), (f)(1), (g), and (h)''; and by removing the cite

``Sec. 61.47(g)'' and adding in their place, the cite

``Sec. 61.47(f)(2)''.

7. Section 61.49(d) is amended by removing the cite

``Sec. 61.47(e)'' and adding, in their place, the cite ``Sec. 61.47(e),

(g), and (h)''.

Sec. 61.58 [Amended]

8. Section 61.58(c)(3) is amended by removing the cite

``Secs. 61.47(e) and (f)'' and adding, in their place, the cite

``Sec. 61.47(e), (f)(1), (g), and (h)''; and by removing the cite

``Sec. 61.47(g)'' and adding in their place, the cite

``Sec. 61.47(f)(2)''.

9. Section 61.58(c)(4) is amended by removing the cite

``Sec. 61.47(e)'' and adding, in their place, the cite ``Sec. 61.47(e),

(g), and (h)''.

PART 69--ACCESS CHARGES

1. The authority citation for part 69 continues to read as follows:

Authority: Secs. 4, 201, 202, 203, 205, 218, 403, 48 Stat. 1066,

1070, 1072, 1077, 1094, as amended, 47 U.S.C. 154, 201, 202, 203,

205, 218, 403.

Sec. 69.110 [Amended]

2. Sections 69.110(c)(1) and 69.110(c)(2) are amended by removing

the words ``to recover the costs'' and adding, in their place, the

words ``for use''.

Sec. 69.113 [Amended]

3. Section 69.113(a) is amended by removing the words ``69.110,

69.111, 69.112''.

4. Section 69.113(d) is amended by removing the words ``Transport

element or elements'' and adding, in their place, the words

``interconnection charge element''.

5. Section 69.113(e) is amended by removing the words ``transport

or''.

Sec. 69.126 [Amended]

Section 69.126 is amended by removing the words ``May 1, 1994'' and

adding, in their place, the words ``six months after the effective date

of the tariffs introducing initial transport rates''.

[FR Doc. 94-4672 Filed 3-3-94; 8:45 am]

BILLING CODE 6712-01-M