(A) No telephone utility shall begin the construction or operation of any telephone utility plant or system, or of any extension thereof, except those ordered by the commission under the provisions of Section 58-9-270, without first obtaining from the commission a certificate that public convenience and necessity require or will require such construction or operation. But this section shall not be construed to require any telephone utility to secure a certificate for any extension within any municipality or district within which it had lawfully commenced operations on June 16, 1950, or for an extension within or to territory already served by it, necessary in the ordinary course of its business, or for an extension into territory contiguous to that already occupied by it as defined by the commission and not receiving similar service from another telephone utility; but, if any telephone utility in constructing or extending its lines, plant, or system unreasonably interferes or is about to interfere unreasonably with the service or system of any other telephone utility, the commission may make such order and prescribe such terms and conditions in harmony with Articles 1 through 13 of this chapter as are just and reasonable.
(B) After notice and an opportunity to be heard, the commission may grant a certificate to operate as a telephone utility, as defined in Section 58-9-10(6), to applicants proposing to furnish local telephone service in the service territory of an incumbent LEC, subject to the conditions and exemptions stated in this section and in applicable federal law. The provisions of this act shall apply to any such application for a certificate pending before the commission on the effective date of this act; provided, however, that any carrier filing an application to furnish telecommunications service as a private line or special access service provider or as a carrier's carrier prior to March 25, 1996, may elect to comply with the certification requirements in effect on that date rather than those contained within this subsection (B); provided, further, however, that such carrier shall comply with subsection (B)(4) hereof. In determining whether to grant a certificate under this subsection, the commission may require, not inconsistent with the federal Telecommunications Act of 1996, that the:
(1) applicant show that it possesses technical, financial, and managerial resources sufficient to provide the services requested;
(2) service to be provided will meet the service standards that the commission may adopt;
(3) provision of the service will not adversely impact the availability of affordable local exchange service;
(4) applicant, to the extent it may be required to do so by the commission, will participate in the support of universally available telephone service at affordable rates; and
(5) provision of the service does not otherwise adversely impact the public interest.
In its application for certification, the applicant seeking to provide the service shall set forth with particularity the proposed geographic territory to be served, and a price list and informational tariff regarding the types of local exchange and exchange access services to be provided. Any person granted authority under this section shall maintain a current price list with the commission and the Office of Regulatory Staff. A commission order, denying or approving an application for certification of a new local telephone service provider, shall be entered no more than sixty days from the filing of the application, except that the commission, upon notice, may extend that period not to exceed an additional sixty days.
(C) The commission shall determine the requirements applicable to all local telephone service providers necessary to implement this subsection. These requirements shall be consistent with applicable federal law and shall:
(1) provide for the reasonable interconnection of facilities between all certificated local telephone service providers upon a bona fide request for interconnection, subject to the negotiation process set forth in subsection (D) of this section;
(2) provide for the transfer of telephone numbers between local telephone service providers in a manner that is technically feasible;
(3) provide for the reasonable unbundling of network elements upon a request from a LEC where technically feasible and priced in a manner that recovers the providing LEC's cost;
(4) determine, for small LEC's, when and under what circumstances resale of local exchange telephone services is in the public interest and should be allowed. Telecommunications services that are available at retail to a specific category of subscribers only shall not be offered for resale to a different category of subscribers; and
(5) provide for the continued development and encouragement of universally available basic local exchange telephone service at reasonably affordable rates.
The final commission order implementing these requirements shall be issued within six months of the effective date of this section, except that the commission, upon notice, may extend that period up to an additional ninety days.
(D) A LEC shall negotiate the rates, terms, and conditions for local interconnection. In the event that the parties are unable to agree on appropriate rates, terms, and conditions for interconnection within one hundred thirty-five to one hundred sixty days of receipt of a bona fide request, either party may petition the commission for determination of the appropriate rates, terms, and conditions for interconnection. This period may be shortened or extended by mutual agreement of the parties. The commission shall determine the appropriate rates, terms, and conditions for interconnection within nine months from the filing of the petition in accordance with the terms of applicable federal law. The regulatory staff shall represent the public interest in any matter undertaken pursuant to this subsection unless the Executive Director of the Office of Regulatory Staff chooses to opt out as a participant pursuant to Section 58-4-50.
(E) In continuing South Carolina's commitment to universally available basic local exchange telephone service at affordable rates and to assist with the alignment of prices and cost recovery with costs, and consistent with applicable federal policies, the commission shall establish a universal service fund (USF) for distribution to a carrier of last resort. The commission shall issue its final order adopting such guidelines as necessary for the funding and management of the USF within twelve months of the effective date of this section except that the commission, upon notice, may extend that period up to an additional ninety days. These guidelines must not be inconsistent with applicable federal law and shall address, without limitation, the following:
(1) The USF must be administered by the Office of Regulatory Staff or a third party designated by the Office of Regulatory Staff under guidelines to be adopted by the commission.
(2) The commission shall require all telecommunications companies providing telecommunications services within South Carolina to contribute to the USF as determined by the commission.
(a) Entities that provide service pursuant to a certificate issued by the commission must remit these contributions to the Office of Regulatory Staff. All other entities must remit these contributions to the Department of Revenue. The Department of Revenue monthly shall assess each provider that does not have such a certificate, the provider's contribution to the USF. The Office of Regulatory Staff shall certify to the Department of Revenue the USF factor and the amounts to be assessed. The USF assessments, less the Department of Revenue actual incremental increase in the cost of administration, must be transferred to the USF administered by the Office of Regulatory Staff or third party administrator designated by the Office of Regulatory Staff.
(b) USF contributions for service defined in Section 58-9-2510(17) must be collected pursuant to Section 58-9-280(E) from consumers, as defined in Section 58-9-2510(13), by persons or entities defined in Section 58-9-2510(16). The amount of the charge to be collected with respect to each retail transaction, as defined in Section 58-9-2510(15) must be a fixed per-transaction fee established annually by the Office of Regulatory Staff. Persons or entities defined in Section 58-9-2510(16) shall submit all necessary forms to the department to demonstrate that the charges have been collected and remitted. An entity that remits funds in support of the USF may file a petition with the commission seeking a review of the fixed per-transaction fee as determined by the Office of Regulatory Staff. A decision by the commission in response to the petition only may be applied prospectively and must be implemented the next time that the Office of Regulatory Staff makes its annual determination of the fixed per-transaction fee.
(c) Entities that are required to contribute shall provide information sufficient to permit the requirements of this subsection to be implemented, monitored, and enforced to the Office of Regulatory Staff. All information, records, documents, and their contents provided to the Office of Regulatory Staff pursuant to this subsection must be maintained as confidential and are exempt from public disclosure under the South Carolina Freedom of Information Act. All information, records, documents, and their contents that are exchanged between the Office of Regulatory Staff and other state or federal agencies related to implementing, monitoring, and enforcing the requirements of this subsection must be maintained as confidential and are exempt from public disclosure under the South Carolina Freedom of Information Act. Except to the extent necessary to implement, monitor, and enforce contributions to the USF, the provisions of this section do not expand, diminish, or otherwise affect any existing jurisdiction of the commission over any telecommunications company, VoIP provider, CMRS provider, prepaid wireless provider, or any services provided by these providers.
(d) A person or entity defined in Section 58-9-2510(16) must collect the USF contribution from a consumer defined in Section 58-9-2510(13) with respect to each retail transaction defined in Section 58-9-2510(15) occurring in this State. The amount of the charge either must be separately stated on an invoice, receipt, or other similar document that is provided to the consumer defined in Section 58-9-2510(13) by the person or entity defined in Section 58-9-2510(16); or otherwise disclosed to the consumer defined in Section 58-9-2510(13). At the election of the person or entity defined in Section 58-9-2510(16), the dual party relay charge, the USF contribution charge, and the 911 charge described in Title 23, Chapter 47, may be combined into a single charge for purposes of being stated on the invoice, receipt, or other similar document or otherwise disclosed to the consumer defined in Section 58-9-2510(13). The person or entity defined in Section 58-9-2510(16) shall notify the department as to how much of the amount remitted is for dual party relay and how much of the amount remitted is for USF.
(i) For the purposes of this subsection, a retail transaction defined in Section 58-9-2510 (15) must be sourced as provided in Section 12-36-910(B)(5)(b).
(ii) A person or entity defined in Section 58-9-2510(16) is entitled to retain three percent of the gross USF contribution remitted to the department as an administrative fee. A person or entity defined in Section 58-9-2510(16) must remit the remainder of the USF contribution to the department on or before the twentieth day of the second month succeeding each monthly collection of the USF charges. The department shall transfer the USF contributions to the USF administered by the Office of Regulatory Staff or third party designated by the Office of Regulatory Staff. The amount of the USF contribution collected by a person or entity defined in Section 58-9-2510(16), whether or not such amount is separately stated on an invoice, receipt, or other similar document provided to the consumer defined in Section 58-9-2510(13), may not be included in the base for measuring any tax, fee, USF contribution, or other charge that is imposed by this State, any political subdivision of this State, or any intergovernmental agency. This amount may not be considered revenue of the person or entity defined in Section 58-9-2510(16).
(iii) The department shall establish procedures by which a person or entity defined in Section 58-9-2510 (16) may document that a sale is not a retail transaction defined in Section 58-9-2510(15), which procedures shall substantially coincide with the procedures for documenting sale for resale transactions pursuant to Section 12-36-950.
(e) The USF contribution required to be remitted to the department must be administered and collected by the department in the same manner as taxes as defined in Section 12-60-30(27) are administered and collected by the department under the provisions of Title 12.
(3) The commission also shall require any company providing telecommunications service to contribute to the USF if, after notice and opportunity for hearing, the commission determines that the company is providing private local exchange services or radio-based local exchange services in this State that compete with a local telecommunications service provided in this State.
(4)(a) The size of the USF must be the sum of:
(i) the amount of USF support received by each carrier of last resort in 2015;
(ii) the amount of Interim LEC Fund support received by each local exchange carrier in 2015;
(iii) all amounts approved by the commission to provide state funding for the Lifeline program for low income subscribers; and
(iv) all amounts approved by the commission for administration of the USF.
(b) The size of the USF may be adjusted to reflect changes in USF support for those LECs that have made the election set out in Section 58-9-576(C).
(5) For local exchange carriers that have previously reduced rates and charges to be eligible to receive USF support and that have not made the election set out in Section 58-9-576(C), money in the USF must be distributed to a local exchange carrier in the same amount distributed to the carrier from the Interim LEC fund in 2015 and to a carrier of last resort in the same amount distributed to the carrier of last resort in 2015 for so long as it continues to serve as a carrier of last resort. For any carrier that makes, or has made, an election under Section 58-9-576(C), its right to recover from the USF must be governed by the provisions of Section 58-9-576(C), and the amount it is entitled to recover must be adjusted in accordance with Section 58-9-576(C); provided, however, that nothing in this subsection restricts the ability of any carrier to withdraw from the State USF all amounts approved by the commission to provide state funding for the Lifeline program for low income subscribers.
(6) For services for which a bill is rendered or a charge is applied before the effective date of this subsection, no subscriber or consumer is liable to any person or entity for a different universal service charge than the consumer or subscriber has been billed or charged, and no telecommunications company, VoIP provider, CMRS provider, or prepaid wireless provider is liable to any person or entity for billing, collecting, or remitting a different universal contribution amount than is required by this article.
(7) Subject to the provisions of items (2), (3), (4), and (5) the commission may make administrative adjustments to the contribution or distribution levels based on yearly reconciliations.
(8) A carrier of last resort authorized to receive funds from the USF is subject to random compliance audits and other investigations by the Office of Regulatory Staff, in accordance with Section 58-4-55.
(9) Nothing in subsection (G) of this section shall preclude the commission from assessing broadband service revenues for purposes of contributions to the USF, pursuant to this subsection.
(10) All carriers of last resort shall retain all records of operations within the jurisdiction of the Office of Regulatory Staff required to demonstrate that the support received was used to support the programs for which it was intended. This documentation must be maintained for at least ten years from the receipt of the funding. All such documents must be made available upon request to the Office of Regulatory Staff.
(11) In order to create an environment that ensures financial stability necessary to encourage long-term investment by carriers of last resort while providing for appropriate oversight:
(a) within two years after the effective date of this subitem, the Office of Regulatory Staff shall provide a report to the Public Utilities Review Committee (PURC) as to the State Universal Service Fund, the need for funding, and the appropriate level of distributions; and
(b) every four years thereafter, the Office of Regulatory Staff shall provide a report to PURC as to the status of the State Universal Service Fund, provide recommendations, and provide such other information as the PURC deems appropriate.
(F) Nothing in this chapter shall be interpreted to limit or restrict any right that any local exchange carrier may have under federal law.
(G)(1) Competition exists for a particular service if, for an identifiable class or group of customers in an exchange, group of exchanges, or other clearly defined geographical area, the service, its functional equivalent, or a substitute service is available from two or more providers. The commission must not:
(a) impose any requirements related to the terms, conditions, rates, or availability of broadband service; or
(b) otherwise regulate broadband service; however, in order to facilitate the continued deployment of broadband service by rural telephone companies as defined in 47 U.S.C. Section 153 (37), facilities utilized by rural telephone companies for the provision of broadband service must continue to be treated by the commission in the same manner as they were treated as of January 1, 2003, so as not to impact the provision or pricing of regulated telecommunications services by rural telephone companies. The commission shall not regulate a service for which competition exists if the market for that service is sufficiently competitive to protect the public interest. If the commission finds that competition exists for a particular service, but that service is not sufficiently competitive to protect the public interest, the commission must provide appropriate regulatory and pricing flexibility to all providers of the service.
(2) Nothing in subsection (G)(1) of this section is intended to affect the Public Service Commission's jurisdiction with respect to any service other than broadband service or to affect the application of access rates and charges to broadband providers or with respect to broadband services. Nothing in subsection (G)(1) of this section shall be construed to relieve an incumbent local exchange carrier, as defined by Section 251(h) of the federal Telecommunications Act of 1996, of its obligations pursuant to Sections 251 and 252 of the federal act or any Federal Communications Commission regulation relating to Sections 251 and 252 of the federal act to provide new entrant LEC's with unbundled access to network elements or interconnection including, but not limited to, loops, subloops, transmission facilities, and collocation space.
(3) The Office of Regulatory Staff must compile information in order to monitor the status of local telephone competition in this State. In compiling this information, the Office of Regulatory Staff must require all local exchange carriers, as defined in Section 58-9-10(12), to report to the Office of Regulatory Staff annually, the total number of access lines providing local exchange telecommunications services to an end user in this State. The Office of Regulatory Staff must also maintain a copy of all written complaints received regarding the impact broadband services may be having on the competitive local exchange market. This information must be compiled and made available prior to May fifteenth of each year.
(H) Any local exchange carrier, upon a showing of changed circumstances or that it is necessary or appropriate to realign rates with the costs of various telecommunications components, may petition the commission to reexamine any rates that have been capped pursuant to the provisions of this chapter and to set new price caps. A copy of the petition must be served upon the Office of Regulatory Staff.
(I) The incumbent LEC's subject to this section shall be authorized to meet the offerings of any local exchange carrier serving the same area by packaging services together, using volume discounts and term discounts, and by offering individual contracts for services, except as restricted by federal law. Individual contracts for services or contracts with other providers of telecommunications services shall not be filed with the commission, except as required by federal law, provided that telecommunications carriers shall provide access to such contracts to the commission as required.
(J) Subject to the requirements of applicable federal law, a small LEC may define the term "cost", as used within this section and where applicable to a small LEC, to include all embedded costs as well as a reasonable contribution to universal local service, where applicable, until such time as these costs are recovered from other sources.
(K) Subject to federal law, if the commission finds that the resale of any service or unbundled capability, element, feature, or function in a small LEC area is in the public interest, then the small LEC shall not be required to offer its services at a price below its cost.
(L) Upon enactment of this section and the establishment of the Interim LEC Fund, as specified in subsection (M) of this section, the commission shall, subject to the requirements of federal law, require any electing incumbent LEC, other than an incumbent LEC operating under an alternative regulation plan approved by the commission before the effective date of this section, to immediately set its toll switched access rates at levels comparable to the toll switched access rate levels of the largest LEC operating within the State. To offset the adverse effect on the revenues of the incumbent LEC, the commission shall allow adjustment of other rates not to exceed statewide average rates, weighted by the number of access lines, and shall allow distributions from the Interim LEC Fund, as may be necessary to recover those revenues lost through the concurrent reduction of the intrastate switched access rates.
(M) The commission shall, not later than December 31, 1996, establish an Interim LEC Fund to be administered by the Office of Regulatory Staff or a designee. The Interim LEC Fund shall initially be funded by those entities receiving an access or interconnection rate reduction from LEC's pursuant to subsection (L) in proportion to the amount of the rate reduction. To the extent that affected LEC's are entitled to payments from the USF, the Interim LEC Fund must transition into the USF as outlined in Section 58-9-280(E) when funding for the USF is finalized and adequate to support the obligations of the Interim LEC Fund.
(N) The commission shall ensure that any requirements implemented under Section 58-9-280(C) are appropriate for the service territory of the small LEC and may implement such alternative requirements necessary to protect the public interest in such service area. Specifically, the commission shall ensure for small LEC's that telecommunications services that are available at retail to a specific category of subscribers only shall not be offered for resale to a different category of subscribers. Additionally, consistent with the federal Telecommunications Act of 1996, LEC's shall not be required to offer for resale services which they do not make available on a retail basis.
(O) If any provision or section of this chapter is held invalid or held not to apply to a particular local exchange carrier, such holding shall not affect the remaining provisions of this chapter or their application to any local exchange carrier to which they might apply.
HISTORY: 1962 Code Section 58-378; 1952 Code Section 58-378; 1950 (46) 2466; 1996 Act No. 354, Section 2, eff May 29, 1996; 2003 Act No. 6, Sections 2, 3, eff March 12, 2003; 2005 Act No. 5, Section 2, eff July 1, 2004; 2006 Act No. 318, Section 35, eff May 24, 2006; 2016 Act No. 181 (S.277), Section 5.A, eff May 25, 2016.
Editor's Note
2016 Act No. 181, Section 5.B, provides as follows:
"B. This entire section is void if any portion of this section is finally adjudicated invalid."
2016 Act No. 181, Section 10, provides as follows:
"SECTION 10. Beginning on the effective date of this act, the Office of Regulatory Staff and the Department of Revenue may take necessary action to accommodate full implementation of SECTIONS 3, 5.A., and 8 of this act, as soon as practicable, provided, however, that full implementation shall not occur earlier than January 1, 2017. The Office of Regulatory Staff and the Department of Revenue shall provide at least thirty days' public notice of the full implementation date before the full implementation of these SECTIONS occurs, and no person or entity is required to bill, collect, remit, or pay any charges pursuant to SECTION 3, 5.A., or 8 of this act prior to the full implementation date."
Effect of Amendment
2016 Act No. 181, Section 5, rewrote (E).