Midmonth filings provide members flexibility for rate adjustments

by Jennifer Leonard, senior director – Access Tariffs and Costs

Is your company looking for more rate flexibility to support your marketing strategies and boost demand? Beginning in early 2017, we have offered flexibility to our members to make monthly changes to their consumer broadband-only loop rates, Subscriber Line Charges and Access Recovery Charges, to the extent allowed by FCC rules. As a result, we have made midmonth tariff filings nearly every month since to accommodate monthly rate changes.

CBOL rate changes

We made our first CBOL rates filing in January 2017. Since that time, many companies entering the broadband market or with just a few CBOL customers have struggled to accurately forecast demand, which affects their CBOL rates.

For some companies, demand has increased and midmonth filings reflect rate decreases resulting from higher demand. For a few companies, optimistic CBOL forecast demand never came to fruition, and therefore they removed their CBOL rate from the tariff. Companies also have the option to reduce their CBOL rate below their fully calculated rate.

SLC reductions to residential, SLB and MLB

The flexibility granted in the 2016 USF RoR Reform Order gives model companies (both A-CAM and Alaska Plan) fixed support amounts and the option of reducing residential, single-line business or multi-line business SLCs from the fully calculated rate. Several companies have chosen to exercise this option.

ARC changes allowed for model and legacy

Both model and legacy carriers are permitted to voluntarily reduce their charged ARC rates. Several companies have done so, voluntarily reducing their residential ARC rates to zero or below their maximum calculated rate. If your company chooses to reduce ARC rates, two points are important to note:

  • The fully calculated ARC rate must be imputed for CAF ICC support purposes per FCC rule 51.917(f)(2), both for the resulting shortfall in billed customer revenues and for the imputation of ARC rates on CBOL lines per FCC rule 51.917(f)(4).
  • The FCC has recently clarified any company reversing its decision to voluntarily reduce ARC rates must then comply with FCC rule 51.917(e)(6)(vi) that allows only a maximum $0.50 increase per year in subsequent years.   

Midmonth filings to continue as necessary

We anticipate continuing to offer these filings as a way for our members to align rates in support of their marketing and business strategies. (Please note: midmonth filings do not occur in the few months preceding the annual tariff filing in June.)

Please contact your region member service manager if your company has an interest in changing CBOL, SLC or ARC rates in a midmonth filing.

Filed under September 2018 , Tagged with FCC, Tariffs, USF Reform

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