Opinion ID: 757345
Heading Depth: 2
Heading Rank: 3

Heading: Originating Minutes

Text: 14 Both the BellSouth petitioners and the Bell Atlantic parties challenge the FCC's actions with respect to the imposition of per-minute charges on originating access minutes. They contend that the requirement to recoup non-traffic-sensitive costs not fully recovered under the flat-rated SLC and PICC price ceilings by applying a per-minute access carrier common line charge (CCLC) and a per-minute residual transport interconnection charge (TIC) assessed on originating access minutes (charges imposed on carriers for outgoing calls), rather than on terminating access minutes, is in violation of the 1996 Act. They argue that the higher degree of competition for originating access minutes will prevent them from imposing the CCLC or the TIC to recoup costs lest they risk losing customers to competitors who can undercut their prices. This approach, according to the BellSouth petitioners, is inherently discriminatory--it places a disproportionate burden of paying for universal service support on incumbent LECs in violation of the Act. See 47 U.S.C.A. § 254(b)(4) (All providers of telecommunications services should make an equitable and nondiscriminatory contribution to ... universal service.). Furthermore, the BellSouth petitioners and the Bell Atlantic parties argue, the Commission's decision to employ a per-minute charge to recover non-traffic-sensitive, or flat, costs is contrary to the agency's stated goal of imposing access charges in a cost-causative manner--in a way that reflects the way the costs are incurred. Order passim. 15 The Commission defends its decision to allow recovery of non-traffic-sensitive residual costs through per-minute access charges as an interim solution that will be phased out as flat-rated PICC caps increase to allow for such recovery. See id. p 102. Prior to the changes implemented in the Order, these residual costs were recovered through per-minute charges assessed on both originating and terminating access minutes. The Commission, realizing that greater competition would exist for provision of originating rather than terminating access minutes, determined that recovery of these residual costs on originating minutes would promote the agency's objective of allowing the marketplace to move LECs' access rates toward competitive levels. See id. p 100. The decision to continue employing a traffic-sensitive mechanism to recover these non-traffic-sensitive costs is justified by universal service concerns. Until flat-rated PICC ceilings rise sufficiently over time to allow recovery of these residual, non-traffic-sensitive costs, the FCC has opted to maintain the non-cost-causative, per-minute charges that, in addition to permitting recovery of otherwise lost residual costs, have the added advantage of promoting Congress's goal of moving access rates toward competitive levels. As the Commission points out, a phased-in transition from non-cost-causative per-minute rates to cost-causative flat rates has been adopted in the Order. 16 We find that the Commission's decision to impose the residual per-minute CCLC and TIC on originating, rather than terminating, access minutes is not in violation of the 1996 Act. This transitional solution is a reasonable exercise of the Commission's discretionary authority to balance competing statutory goals. See National Ass'n of Regulatory Util. Comm'rs, 737 F.2d at 1134 (noting that FCC has broad statutory discretion to balance the multiple goals embodied in the Communications Act). Rather than jeopardize universal service support by immediately eliminating any per-minute charges currently associated with flat costs, the FCC elected to eliminate these non-cost-causative charges over time, gradually increasing the flat-rated PICC to levels necessary to recoup these residual costs. The shift from one type of nondiscriminatory rate structure to another may certainly be accomplished gradually to permit the affected carriers, subscribers and state regulators to adjust to the new pricing system, thus preserving the efficient operation of the interstate telephone network during the interim. Id. at 1135-36. We cannot conclude that this solution is contrary to the 1996 Act. 17 Furthermore, we cannot second-guess the FCC's decision to impose the CCLC and the TIC on originating access minutes. The 1996 Act was intended to encourage competition in the telecommunications market, and the Commission's determination that the above transitional method of accounting for residual costs would increase competition and move costs toward competitive levels is a reasonable one. See Competitive Telecomms., 117 F.3d at 1073-75 (according substantial deference to transitional plan to preserve universal service). It is not the Commission's chore to convince us that what it has done is the best that could be done, but that what it has done is reasonable under difficult circumstances. National Ass'n of Regulatory Util. Comm'rs, 737 F.2d at 1141. 18