Opinion ID: 1752828
Heading Depth: 3
Heading Rank: 1

Heading: The 1995 pre-codified version

Text: On September 1, 1995, Southwestern Bell elected to participate in the Legislature's newly created incentive regulation. At that time, PURA section 3.352(d) provided that an electing company was not under any circumstances ... subject to any complaint, hearing, or determination as to the reasonableness of its rates, its overall revenues, its return on invested capital, or its net income. [9] In return, section 3.352(a) required that an electing company commit to making certain infrastructure improvements and to capping its rates for basic network services for a specified time period. [10] Section 3.353 provided exceptions to section 3.352(a)'s rate cap for: (1) certain changes in Federal Communications Commission (FCC) separations affecting intrastate net income; [11] (2) having less than five million access lines in the state; [12] and (3) rate group reclassification based on access line growth. [13] The exception for rate-group reclassification, contained in section 3.353(c)(4), stated: Notwithstanding the commitments made under Section 3.352 of this Act, a rate group reclassification occurring as a result of access lines growth shall be allowed by the commission on request of the electing company. [14] Section 3.354(c) required the PUC to review any rates adjusted based on access line growth to ensure that the proposed adjustment conforms to the requirements of Section 3.353(c) of this Act. [15] Section 3.354(e) allowed the PUC, after review, to issue an order approving, modifying, or rejecting the rate adjustment, depending on whether it was in compliance with the applicable provisions. [16] Section 3.353(d)(1) discussed generally the regulation of basic network services of an electing company. [17] It directed that, to the extent not inconsistent with this subtitle, such regulation be governed by sections 3.202 and 3.215, among other general rate-making provisions. [18] Section 3.202 required the PUC to ensure that all public utility rates were just and reasonable: It shall be the duty of the commission to insure that every rate made, demanded, or received by any public utility ... shall be just and reasonable. Rates may not be unreasonably preferential, prejudicial, or discriminatory, but shall be sufficient, equitable, and consistent in application to each class of consumers. [19] Section 3.215 similarly prohibited a public utility from establishing any unreasonable differences as to service rates between localities: A public utility may not, as to rates or services, make or grant any unreasonable preference or advantage to any corporation or person within any classification or subject any corporation or person within any classification to any unreasonable prejudice or disadvantage. A public utility may not establish and maintain any unreasonable differences as to rates of service either as between localities or as between classes of service. [20]