Firm Advisory:


On May 24th, the New York Public Service Commission (“PSC”) issued an Order requiring all LECs to comply with FCC access reforms by filing revised tariffs no later than June 15, 2012.  An Errata Notice was issued on June 1, 2012.

This action follows the FCC’s issuance of a Report and Order on November 18, 2011 that implements broad reforms to intercarrier compensation (“ICC”) rules.  Chief among these reforms is the requirement that all ICC charges be reduced to bill-and-keep by 2020.  Toward that end, the FCC is requiring the transitional reduction of both intrastate and interstate access charges.  The first transitional reduction occurs on July 1, 2012.

The New York PSC initiated a proceeding to implement the access rate reductions and ensure ongoing compliance with PSC pricing and tariffing rules.  To coordinate compliance with the FCC rate reductions scheduled for July 1st, the PSC Order establishes the following:

  • Tariffs must comply with both the new FCC rate cap and the PSC’s existing rate cap:
    • FCC Rate Cap:  By July 1, 2012, most rates must be reduced by 50% of the difference between current intrastate and interstate rates (see Report and Order at p. 272).
      • LECs must file calculations supporting rate changes under the FCC’s formula.
    • PSC Rate Cap:  CLEC access rates remain capped at the ILEC rate for each region.
  • The PSC had previously required all ILECs to file summaries of the rates that go into effect on July 1, 2012, to facilitate CLEC compliance with the PSC Rate Cap.
    • Verizon’s and Frontier’s new rates are set forth in an Attachment to the Order
  • The requisite tariff revisions are permitted to go into effect on 15 days’ notice, rather than the typical 30 days’ notice.
    • Thus, all carriers must file revised access tariffs no later than June 15, 2012.
  • All revised tariffs must contain a notation at the bottom of each page that reads “issued in compliance with the Commission’s Order in Case 12-C-0112, issued May 24, 2012.”

In those instances in which carriers have employed rate structures in their interstate and intrastate tariffs that differ from one another, application of the FCC’s formula is necessarily more complex.  To minimize such complications going forward, the Order notes that many carriers are intending to conform their intrastate access rate structures to the interstate structures.  Verizon, for example, is eliminating its time-of-day access charge rate structure for usage-sensitive terminating access charges.

The Order recognizes that – as a result of these modifications – some rate elements will be eliminated, while some new rate elements will be introduced.  “Overall, however, terminating access charges will be reduced for most LECs and will not increase for any LECs.  In addition, any single rate element that provides for a function equivalent to that function priced higher in a LEC’s interstate tariff cannot be increased, in accordance with the FCC Order.”  PSC Order at 5.

As we remain active in key telecom matters at the Commission, and continue to work with the PSC and its Staff on this issue, we would be pleased to provide further information or assistance concerning compliance with these new directives.

For further information concerning these important issues, please contact any of the following attorneys:

Andy Klein 202-289-6955 –

Allen Zoracki 518-336-4300 –

This Advisory is provided for general informational purposes as a courtesy to clients and friends of the firm. While it is not intended to be and should not be relied upon as legal advice, we would be pleased to provide additional details, or advice regarding the application of this development to specific facts and circumstances.