[Federal Register Volume 61, Number 49 (Tuesday, March 12, 1996)]
[Proposed Rules]
[Pages 9968-9969]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-5826]



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FEDERAL COMMUNICATIONS COMMISSION
47 CFR Part 65

[CC Docket No. 96-22; FCC 96-63]


Interstate Rate of Return Prescription Procedures and 
Methodologies, Subpart G, Rate Base

AGENCY: Federal Communications Commission.

ACTION: Proposed rule.

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SUMMARY: The Federal Communications Commission proposes to amend its 
rules regarding, ``Interstate Rate of Return Prescription Procedures 
and Methodologies,'' to revise the rate base treatment of prepaid 
postretirement benefits other than pensions (OPEB) costs recorded In 
Account 1410, Other Noncurrent Assets, and all items in Account 4310, 
Other Long-Term Liabilities, including accrued liabilities related to 
OPEBs. The Commission is taking this action to update its interstate 
rate base rules so that items of similar nature can be afforded uniform 
treatment under the rate base rules.

DATES: Comments must be filed on or before April 12, 1996, and reply 
comments must be filed on or before May 14, 1996.

ADDRESSES: Comments should be addressed to Office of the Secretary, 
Federal Communications Commission, 1919 M Street, N.W., Washington, 
D.C. 20554.

FOR FURTHER INFORMATION CONTACT: Clara Kuehn or Thaddeus Machcinski, 
Common Carrier Bureau, Accounting and Audits Division, (202) 418-0800.

SUPPLEMENTARY INFORMATION: This is a synopsis of the Federal 
Communications Commission's Notice of Proposed Rulemaking in CC Docket 
No. 96-22, Amendments to Part 65, Interstate Rate of Return 
Prescription Procedures and Methodologies, Subpart G, Rate Base, FCC 
96-63, adopted February 20, 1996 and released March 7, 1996. The 
complete text of the Notice of Proposed Rulemaking is available for

[[Page 9969]]

inspection and copying during normal business hours in the Commission's 
Reference Center, Room 239, 1919 M Street, N.W., Washington D.C. 20554, 
and may also be purchased from the Commission's copy contractor, 
International Transcription Service, Inc., at 2100 M Street, N.W., 
Suite 140, Washington, D.C. 20037, telephone number (202) 857-3800.

Synopsis of Notice of Proposed Rulemaking

    1. The Notice of Proposed Rulemaking invites comment on proposals 
to revise the rate base treatment of prepaid postretirement benefits 
other than pensions (OPEB) costs recorded in Account 1410, Other 
Noncurrent Assets, and all items in Account 4310, Other Long-Term 
Liabilities, including accrued liabilities related to OPEBs. The 
Commission notes that it does not agree with the suggestion by some 
parties that modification of its Part 65 regulations be deferred until 
the conclusion of several pending investigations of LEC tariffs, which 
include exogenous adjustments for OPEB costs, but invites comment on 
this issue.
    2. The Notice of Proposed Rulemaking proposes to include prepaid 
OPEB costs recorded in Account 1410, Order Noncurrent Assets, in the 
interstate rate base. The rationale for this action is our tentative 
conclusion that prepaid OPEB costs in excess of the SFAS-106 cost 
calculation earn a return, which benefits ratepayers by reducing 
amounts companies must accrue in future periods. Because investors fund 
these excess prepayments, this Notice proposes to include these excess 
prepayments in the rate base. The Commission invites comment on this 
proposal.
    3. Currently, unfunded accrued pension costs recorded in Account 
4310 are removed from the rate base, although other items recorded in 
Account 4310, such as accrued OPEB liabilities, are not removed from 
the rate base. The Notice of Proposed Rulemaking proposes to accord to 
the accrued OPEB liabilities recorded in Account 4310 the same rate 
base treatment presently accorded to unfunded accrued pension costs 
without modifying the rate base treatment for other items recorded in 
Account 4310. Alternatively, the Notice of Proposed Rulemaking also 
proposes to exclude all amounts recorded in Account 4310 from the 
interstate rate base. It is the Commission's tentative conclusion that 
all items recorded in Account 4310 should be removed from the rate base 
because these amounts are zero-cost sources of funds, those funds 
provided to a carrier without cost to investors. The Commission invites 
comment on these proposals.
    4. In the Notice the Commission states that this rulemaking is a 
non-restricted notice and comment proceeding. Ex parte presentations 
are permitted, except during the Sunshine Agenda period, provided they 
are disclosed as provided in the Commission's rules, 47 CFR 1.1202, 
1.1203, 1.1206.
    5. In the Notice the Commission certifies that the Regulatory 
Flexibility Act of 1980 does not apply to this rulemaking proceeding 
because if the proposals in this proceeding are adopted, there will not 
be a significant economic impact on a substantial number of small 
business entities, as defined by Section 601(3) of the Regulatory 
Flexibility Act. Because of the nature of local exchange and access 
service, the Commission has concluded that LECs, including small LECs, 
are dominant in their fields of operation and therefore are not ``small 
entities'' as defined by that act. The Secretary has sent a copy of 
this Notice of Proposed Rulemaking, including the certification, to the 
Chief Counsel for advocacy of the Small Business Administration in 
accordance with Section 603(a) of that act.

Ordering Clause

    6. Accordingly, IT IS ORDERED that, pursuant to Sections 1, 4(i), 
4(j), 201 through 205, 220, and 403 of the Communications Act of 1934, 
as amended, 47 U.S.C. 151, 154(i), 154(j), 201 through 205, 220 and 
403, notice is hereby given of proposed amendments to Part 65, Subpart 
G of the Commission's Rules, 47 CFR Part 65, Subpart G, as described in 
the Notice of Proposed Rulemaking.

List of Subjects in 47 CFR Part 65

    Administrative practice and procedure; Communications common 
carriers; Reporting and recordkeeping requirements; Telephone.

Federal Communications Commission.
William F. Caton,
Acting Secretary.
[FR Doc. 96-5826 Filed 3-11-96; 8:45 am]
BILLING CODE 6712-01-P