CHAPTER 51. GENERAL PROVISIONS - Texas Statutes

UTILITIES CODE

TITLE 2. PUBLIC UTILITY REGULATORY ACT

SUBTITLE C. TELECOMMUNICATIONS UTILITIES

CHAPTER 51. GENERAL PROVISIONS

Sec. 51.001. POLICY. (a) Significant changes have occurred in

telecommunications since the law from which this title is derived

was originally adopted. To encourage and accelerate the

development of a competitive and advanced telecommunications

environment and infrastructure, new rules, policies, and

principles must be formulated and applied to protect the public

interest. Changes in technology and market structure have

increased the need for minimum standards of service quality,

customer service, and fair business practices to ensure

high-quality service to customers and a healthy marketplace where

competition is permitted by law. It is the purpose of this

subtitle to grant the commission authority to make and enforce

rules necessary to protect customers of telecommunications

services consistent with the public interest.

(b) It is the policy of this state to:

(1) promote diversity of telecommunications providers and

interconnectivity;

(2) encourage a fully competitive telecommunications

marketplace; and

(3) maintain a wide availability of high quality, interoperable,

standards-based telecommunications services at affordable rates.

(c) The policy goals described by Subsection (b) are best

achieved by legislation that modernizes telecommunications

regulation by:

(1) guaranteeing the affordability of basic telephone service in

a competitively neutral manner; and

(2) fostering free market competition in the telecommunications

industry.

(d) The technological advancements, advanced telecommunications

infrastructure, and increased customer choices for

telecommunications services generated by a truly competitive

market play a critical role in Texas' economic future by raising

living standards for Texans through:

(1) enhanced economic development; and

(2) improved delivery of education, health, and other public and

private services.

(e) The strength of competitive forces varies widely between

markets, products, and services. It is the policy of this state

to require the commission to take action necessary to enhance

competition by adjusting regulation to match the degree of

competition in the marketplace to:

(1) reduce the cost and burden of regulation; and

(2) protect markets that are not competitive.

(f) It is the policy of this state to ensure that high quality

telecommunications services are available, accessible, and usable

by an individual with a disability, unless making the services

available, accessible, or usable would:

(1) result in an undue burden, including unreasonable cost or

technical infeasibility; or

(2) have an adverse competitive effect.

(g) It is the policy of this state to ensure that customers in

all regions of this state, including low-income customers and

customers in rural and high cost areas, have access to

telecommunications and information services, including

interexchange services, cable services, wireless services, and

advanced telecommunications and information services, that are

reasonably comparable to those services provided in urban areas

and that are available at prices that are reasonably comparable

to prices charged for similar services in urban areas. Not later

than November 1, 1999, the commission shall begin a review and

evaluation of the availability and the pricing of

telecommunications and information services, including

interexchange services, cable services, wireless services, and

advanced telecommunications and information services, in rural

and high cost areas, as well as the convergence of

telecommunications services. The commission shall file a report

with the legislature not later than January 1, 2001. The report

must include the commission's recommendations on the issues

reviewed and evaluated.

Acts 1997, 75th Leg., ch. 166, Sec. 1, eff. Sept. 1, 1997.

Amended by Acts 1999, 76th Leg., ch. 1212, Sec. 4, eff. Sept. 1,

1999.

Sec. 51.002. DEFINITIONS. In this subtitle:

(1) "Basic local telecommunications service" means:

(A) flat rate residential and business local exchange telephone

service, including primary directory listings;

(B) tone dialing service;

(C) access to operator services;

(D) access to directory assistance services;

(E) access to 911 service provided by a local authority or dual

party relay service;

(F) the ability to report service problems seven days a week;

(G) lifeline and tel-assistance services; and

(H) any other service the commission determines after a hearing

is a basic local telecommunications service.

(2) "Dominant carrier" means a provider of a communication

service provided wholly or partly over a telephone system who the

commission determines has sufficient market power in a

telecommunications market to control prices for that service in

that market in a manner adverse to the public interest. The term

includes a provider who provided local exchange telephone service

within a certificated exchange area on September 1, 1995, as to

that service and as to any other service for which a competitive

alternative is not available in a particular geographic market.

In addition, with respect to:

(A) intraLATA long distance message telecommunications service

originated by dialing the access code "1-plus," the term includes

a provider of local exchange telephone service in a certificated

exchange area for whom the use of that access code for the

origination of "1-plus" intraLATA calls in the exchange area is

exclusive; and

(B) interexchange services, the term does not include an

interexchange carrier that is not a certificated local exchange

company.

(3) "Incumbent local exchange company" means a local exchange

company that has a certificate of convenience and necessity on

September 1, 1995.

(4) "Local exchange company" means a telecommunications utility

that has a certificate of convenience and necessity or a

certificate of operating authority to provide in this state:

(A) local exchange telephone service;

(B) basic local telecommunications service; or

(C) switched access service.

(5) "Local exchange telephone service" means telecommunications

service provided within an exchange to establish connections

between customer premises within the exchange, including

connections between a customer premises and a long distance

provider serving the exchange. The term includes tone dialing

service, service connection charges, and directory assistance

services offered in connection with basic local

telecommunications service and interconnection with other service

providers. The term does not include the following services,

whether offered on an intraexchange or interexchange basis:

(A) central office based PBX-type services for systems of 75

stations or more;

(B) billing and collection services;

(C) high-speed private line services of 1.544 megabits or

greater;

(D) customized services;

(E) private line or virtual private line services;

(F) resold or shared local exchange telephone services if

permitted by tariff;

(G) dark fiber services;

(H) non-voice data transmission service offered as a separate

service and not as a component of basic local telecommunications

service;

(I) dedicated or virtually dedicated access services; or

(J) any other service the commission determines is not a "local

exchange telephone service."

(6) "Long run incremental cost" has the meaning assigned by 16

T.A.C. Section 23.91 or its successor.

(7) "Pricing flexibility" includes:

(A) customer specific contracts;

(B) packaging of services;

(C) volume, term, and discount pricing;

(D) zone density pricing, with a zone to be defined as an

exchange; and

(E) other promotional pricing.

(8) "Public utility" or "utility" means a person or river

authority that owns or operates for compensation in this state

equipment or facilities to convey, transmit, or receive

communications over a telephone system as a dominant carrier. The

term includes a lessee, trustee, or receiver of any of those

entities, or a combination of those entities. The term does not

include a municipal corporation. A person is not a public utility

solely because the person:

(A) furnishes or furnishes and maintains a private system;

(B) manufactures, distributes, installs, or maintains customer

premise communications equipment and accessories; or

(C) furnishes a telecommunications service or commodity only to

itself, its employees, or its tenants as an incident of

employment or tenancy, if that service or commodity is not resold

to or used by others.

(9) "Separation" means the division of plant, revenues,

expenses, taxes, and reserves applicable to exchange or local

service if these items are used in common to provide public

utility service to both local exchange telephone service and

other service, such as interstate or intrastate toll service.

(10) "Telecommunications provider":

(A) means:

(i) a certificated telecommunications utility;

(ii) a shared tenant service provider;

(iii) a nondominant carrier of telecommunications services;

(iv) a provider of commercial mobile service as defined by

Section 332(d), Communications Act of 1934 (47 U.S.C. Section 151

et seq.), Federal Communications Commission rules, and the

Omnibus Budget Reconciliation Act of 1993 (Public Law 103-66),

except that the term does not include these entities for the

purposes of Chapter 17, 55, or 64;

(v) a telecommunications entity that provides central office

based PBX-type sharing or resale arrangements;

(vi) an interexchange telecommunications carrier;

(vii) a specialized common carrier;

(viii) a reseller of communications;

(ix) a provider of operator services;

(x) a provider of customer-owned pay telephone service; or

(xi) a person or entity determined by the commission to provide

telecommunications services to customers in this state; and

(B) does not mean:

(i) a provider of enhanced or information services, or another

user of telecommunications services, who does not also provide

telecommunications services; or

(ii) a state agency or state institution of higher education, or

a service provided by a state agency or state institution of

higher education.

(11) "Telecommunications utility" means:

(A) a public utility;

(B) an interexchange telecommunications carrier, including a

reseller of interexchange telecommunications services;

(C) a specialized communications common carrier;

(D) a reseller of communications;

(E) a communications carrier who conveys, transmits, or receives

communications wholly or partly over a telephone system;

(F) a provider of operator services as defined by Section

55.081, unless the provider is a subscriber to customer-owned pay

telephone service; and

(G) a separated affiliate or an electronic publishing joint

venture as defined in Chapter 63.

(12) "Tier 1 local exchange company" has the meaning assigned by

the Federal Communications Commission.

Acts 1997, 75th Leg., ch. 166, Sec. 1, eff. Sept. 1, 1997.

Amended by Acts 1999, 76th Leg., ch. 1212, Sec. 5, eff. Sept. 1,

1999; Acts 1999, 76th Leg., ch. 1579, Sec. 4, eff. Aug. 30, 1999;

Acts 2001, 77th Leg., ch. 651, Sec. 5, eff. Sept. 1, 2001.

Sec. 51.003. APPLICABILITY. Except as otherwise expressly

provided by this title, this title does not apply to:

(1) a company that as its only form of business:

(A) is a telecommunications manager; or

(B) administers central office based or customer based PBX-type

sharing/resale arrangements;

(2) telegraph services;

(3) television or radio stations;

(4) community antenna television services; or

(5) a provider of commercial mobile service as defined by

Section 332(d), Communications Act of 1934 (47 U.S.C. Section 151

et seq.), Federal Communications Commission rules, and the

Omnibus Budget Reconciliation Act of 1993 (Public Law 103-66),

other than conventional rural radio-telephone services provided

by a wire-line telephone company under the Public Mobile Service

rules of the Federal Communications Commission (47 C.F.R. Part

22).

Acts 1997, 75th Leg., ch. 166, Sec. 1, eff. Sept. 1, 1997.

Sec. 51.004. PRICING FLEXIBILITY. (a) A discount or other form

of pricing flexibility may not be:

(1) unreasonably preferential, prejudicial, or discriminatory;

or

(2) predatory or anticompetitive.

(b) This title does not prohibit a volume discount or other

discount based on a reasonable business purpose. A price that is

set at or above the long run incremental cost of a service is

presumed not to be a predatory price.

(c) This title allows an offer based on a reasonable business

purpose, including an offer made at any time to a selected

customer or a group of customers in response to a competitor's

offer or a former customer's acceptance of a competitor's offer

if the price of the offer meets the requirements of Section

52.0584, 58.063, or 59.031.

(d) An offer made under Subsection (c) must be made in

compliance with Chapter 304, Business & Commerce Code.

Acts 1997, 75th Leg., ch. 166, Sec. 1, eff. Sept. 1, 1997.

Amended by Acts 1999, 76th Leg., ch. 1212, Sec. 6, eff. Sept. 1,

1999; Acts 2003, 78th Leg., ch. 32, Sec. 1, eff. Sept. 1, 2003.

Amended by:

Acts 2007, 80th Leg., R.S., Ch.

885, Sec. 2.39, eff. April 1, 2009.

Sec. 51.005. ASSISTANCE TO MUNICIPALITY. On request of a

municipality, the commission may advise and assist the

municipality with respect to a question or proceeding arising

under this title. Assistance provided by the commission may

include aid to a municipality on a matter pending before the

commission or a court, such as making a staff member available as

a witness or otherwise providing evidence to the municipality.

Acts 1997, 75th Leg., ch. 166, Sec. 1, eff. Sept. 1, 1997.

Sec. 51.006. MUNICIPAL PARTICIPATION IN RATEMAKING PROCEEDINGS.

(a) The governing body of a municipality participating in a

ratemaking proceeding may engage rate consultants, accountants,

auditors, attorneys, and engineers to:

(1) conduct investigations, present evidence, and advise and

represent the governing body; and

(2) assist the governing body with litigation before the

commission or a court.

(b) The public utility in the ratemaking proceeding shall

reimburse the governing body of the municipality for the

reasonable cost of the services of a person engaged under

Subsection (a) to the extent the commission determines is

reasonable.

Acts 1997, 75th Leg., ch. 166, Sec. 1, eff. Sept. 1, 1997.

Sec. 51.007. MUNICIPAL STANDING IN CERTAIN CASES. (a) A

municipality has standing in each case before the commission that

relates to a utility providing service in the municipality.

(b) A municipality's standing is subject to the right of the

commission to:

(1) determine standing in a case involving a retail service area

dispute that involves two or more utilities; and

(2) consolidate municipalities on an issue of common interest.

Acts 1997, 75th Leg., ch. 166, Sec. 1, eff. Sept. 1, 1997.

Sec. 51.008. JUDICIAL REVIEW. A municipality is entitled to

judicial review of a commission order relating to a utility

providing services in the municipality as provided by Section

15.001.

Acts 1997, 75th Leg., ch. 166, Sec. 1, eff. Sept. 1, 1997.

Sec. 51.009. MUNICIPAL FEES. (a) Nothing in this title,

including Section 53.201, may be construed as in any way limiting

the right of a public utility to pass through a municipal fee,

including an increase in a municipal fee.

(b) A public utility that traditionally passes through municipal

fees shall promptly pass through any municipal fee reduction.

Acts 1997, 75th Leg., ch. 166, Sec. 1, eff. Sept. 1, 1997.

Sec. 51.010. COMMISSION INVESTIGATION OF SALE, MERGER, OR

CERTAIN OTHER ACTIONS. (a) The commission, not later than the

180th day after the date a public utility reports to the

commission under Section 14.101, shall complete an investigation

under that section and enter a final order.

(b) If a final order is not entered as required by Subsection

(a), the commission is considered to have determined that the

action taken by the public utility is consistent with the public

interest.

(c) Section 14.101 does not apply to:

(1) a company that receives a certificate of operating authority

or a service provider certificate of operating authority under

Chapter 54; or

(2) a company electing under Chapter 58.

Acts 1997, 75th Leg., ch. 166, Sec. 1, eff. Sept. 1, 1997.