Alaska Exchange Carriers AssociationAlaska Exchange Carriers Association February 10, 2012

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How do current access charges fit in with the FCC’s proposed transition to bill and keep?FCC s proposed transition to bill and keep?

◦ The Alaska access charge process is outlined in the h l ( l) dAccess Charge Manual (Manual) and may require some

modifications or waivers to work though issues.

Th RCA h ld l i th Al k I t t t◦ The RCA should explain the Alaska Intrastate Interexchange Access Charge Manual and pooling process in Alaska to the FCC.

◦ AECA can meet the transition timeline for the pooled rate elements.

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Will FCC scheduled intrastate access rate reductions b i ith th J l 2014 t i Fi 9?begin with the July 2014 step in Figure 9?

◦ No, AECA pooled intrastate access rate reductions , pcould begin as early as July 1, 2012. This reduction would begin the step down of the current intrastate terminating information surcharge rateterminating information surcharge rate.

◦ AECA plans to file the intrastate rate change if i d h i i f irequired, as soon as the interstate rate information

is available, to reconcile with the interstate rate that goes into effect July 1, 2012.

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What is the effect of the cap on the current i t t t t ?intrastate access rates?

◦ There is no effect on the current rate.There is no effect on the current rate.

What is the effect on current access charge proceedings?proceedings?

◦ Demand filed on Jan 20, 2012 needs to be re-filed J ,to reflect the split between originating and terminating.

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*As of July 1, 2012 the J y ,NECA info surcharge rate is lower than the AECA rate.

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Will carriers need to file tariffs with separate rates for originating and terminating access?

Y AECA l t fil i i ti d t i ti◦ Yes, AECA plans to file originating and terminating local switching and information surcharge pooled rates for 2012 on or before February 15, 2012.

◦ Terminating local switching and information surcharge rates are frozen at the rate in effect onsurcharge rates are frozen at the rate in effect on Dec.29, 2011.

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Other concerns with current access h ?charge structure? NECA will use the Local switching revenue in the calculation

of the Eligible recovery ROR baseline. (892 ROR). The RCA should explain the difference between the NECA

pool and AECA pool. NECA: Current Revenue Requirement, Projected Demand and

True up mechanismTrue up mechanism. AECA: Two year lag in updating revenue requirement, actual

demand is split between two groups that update every other year and there is no true up mechanism.D d h dil d li d d i d i Demand has steadily declined and is expected to continue to decline.

AECA local switching rate element has under recovered its revenue requirement as a result of this method. q

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