Sec.  36.154   Exchange Line Cable and Wire Facilities (C&WF)—Category
1—apportionment procedures.

   (a) Exchange Line C&WF—Category 1. The first step in apportioning the cost
   of exchange line cable and wire facilities among the operations is the
   determination of an average cost per working loop. This average cost per
   working loop is determined by dividing the total cost of exchange line cable
   and wire Category 1 in the study area by the sum of the working loops
   described in subcategories listed below. The subcategories are:

   Subcategory 1.1—State Private Lines and State WATS Lines. This subcategory
   shall include all private lines and WATS lines carrying exclusively state
   traffic as well as private lines and WATS lines carrying both state and
   interstate traffic if the interstate traffic on the line involved
   constitutes ten percent or less of the total traffic on the line.

   Subcategory 1.2—Interstate private lines and interstate WATS lines. This
   subcategory shall include all private lines and WATS lines that carry
   exclusively interstate traffic as well as private lines and WATS lines
   carrying both state and interstate traffic if the interstate traffic on the
   line involved constitutes more than ten percent of the total traffic on the
   line.

   Subcategory 1.3—Subscriber or common lines that are jointly used for local
   exchange service and exchange access for state and interstate interexchange
   services.

   (b) The costs assigned to subcategories 1.1 and 1.2 shall be directly
   assigned to the appropriate jurisdication.

   (c) Except as provided in  Sec. 36.154 (d) through (f), effective January 1,
   1986, 25 percent of the costs assigned to subcategory 1.3 shall be allocated
   to the interstate jurisdiction.

   (d) Except as provided in  Sec. 36.154(f), the interstate allocation of
   subcategory 1.3 costs for the years 1988, 1989, 1990, 1991 and 1992 will be
   as follows:

   (1) 1988—The  Sec. 36.154(e) allocation factor multiplied by .625 plus .09375.

   (2) 1989—The  Sec. 36.154(e) allocation factor multiplied by .5 plus .125.

   (3) 1990—The  Sec. 36.154(e) allocation factor multiplied by .375 plus .15625.

   (4) 1991—The  Sec. 36.154(e) allocation factor multiplied by .25 plus .1875.

   (5) 1992—The  Sec. 36.154(e) allocation factor multiplied by .125 plus .21875.

   (e) For purposes of the transitional allocations described in  Sec. 36.154 (d)
   and (f) an allocation factor known as the subscriber plant factor or SPF
   that is the sum of the following shall be computed:

   (1) Annual average interstate subscriber line use (SLU), for the calendar
   year 1981. ^2 representing the interstate use of the subscriber plant as
   measured by the ratio of interstate holding time minutes of use to total
   holding time minutes of use applicable to traffic originating and
   terminating in the study area, multiplied by .85, the nationwide ratio of
   subscriber plant costs assignable to the exchange operation per minute of
   exchange use to total subscriber plant cost per total minute of use of
   subscriber plant, plus

   ^2 In the case of a company that cannot calculate the average interstate
   subscriber line usage (SLU) ratio for the calendar year 1981, the average
   interstate SLU for the customarily used 12-month study period ending in 1981
   may be utilized. In the case of a company for which no such 1981 annual
   average SLU exists, the annual average interstate SLU for the initial study
   period will be utilized.

   (2) Twice the annual average interstate subscriber line use ratio for the
   study area for the calendar year 1981, multiplied by the annual average
   composite station rate ratio used for the calendar year 1981 (ratio of the
   nationwide, industry-wide average interstate initial 3-minute station charge
   at the study area average interstate length of haul to the nationwide,
   industry-wide average total toll initial 3-minute station charge at the
   nationwide average length of haul for all toll traffic for the total
   telephone industry).

   (f) Limit on Change in Interstate Allocation. (1) No study area's percentage
   interstate allocation for Subcategory 1.3 Exchange Line C&WF and COE,
   Exchange Line Circuit Equipment Excluding Wideband—Category 4.13 investment
   as well as associated maintenance and depreciation shall decrease by a total
   of more than five percentage points from one calendar year to the next as a
   result of the combined operations of  Sec.  Sec. 36.154(d) and 36.641 (a) and (b).

   (2) The determination of whether the decrease in the interstate allocation
   for a given study area resulting from the operation of  Sec.  Sec. 36.154(d) and
   36.641(a) through 36.641(b) exceeds five percentage points shall be made by
   calculating a percentage interstate allocation for both of the years
   involved. This shall be done by dividing the interstate allocation of
   subcategory 1.3 Exchange Line C&WF and COE exchange Line circuit Equipment
   Excluding Wideband Category 4.13 and associated expenses for each year as
   calculated pursuant to  Sec. 36.154(f)(4) by the total unseparated investment in
   Exchange Line C&WF subcategory 1.3 and COE Category 4.13 and associated
   expenses for the corresponding year as calculated pursuant to  Sec. 36.154(f)(5).

   (3) If the resulting percentage for the more recent of the two years is more
   than five percentage points less than the percentage for the earlier year,
   the decrease in the interstate allocations shall be reduced pro rata for
   plant investment, maintenance and depreciation so that the difference
   between the two percentages does not equal more than five percentage points.

   (4) The sum of the following:

   (i) The net interstate allocation of Exchange Line C&WF—subcategory 1.3
   investment calculated pursuant to  Sec. 36.154(d) and (e) multiplied by the
   authorized interstate rate of return.

   (ii) The net interstate allocation of COE Exchange Line Circuit
   Equipment—Category 4.13 investment calculated purusant to  Sec. 36.154 (d) and
   (e) multiplied by the authorized interstate rate of return.

   (iii) The interstate allocation of maintenance and depreciation attributable
   to Exchange Line C&WF subcategory 1.3 customer premises wire and COE Exhange
   Line Circuit Equipment—Category 4.13 calculated pursuant to  Sec. 36.154 (d) and
   (e).

   (iv) The amount of the additional interstate expense allocation calculated
   pursuant to  Sec. 36.641.

   (5) The sum of the following:

   (i) The net unseparated Exchange Line C&WF subcategory 1.3 investment
   multiplied by the authorized interstate rate of return.

   (ii) The net unseparated COE Exchange Line Circuit—Category 4.13 investment
   multiplied by the authorized interstate rate of return.

   (iii) The unseparated maintenance and depreciation attributable to Exchange
   Line C&WF subcategory 1.3 investment, customer premises wiring investment
   and COE Exhange Line Circuit Equipment—Category 4.13 investment.

   (g) Effective July 1, 2001, through June 30, 2006, all study areas shall
   apportion Subcategory 1.3 Exchange Line C&WF among the jurisdictions as
   specified in  Sec. 36.154(c). Direct assignment of subcategory Categories 1.1 and
   1.2 Exchange Line C&WF to the jurisdictions shall be updated annually as
   specified in  Sec. 36.154(b).

   [ 52 FR 17229 , May 6, 1987, as amended at  53 FR 33012 , Aug. 29, 1988;  54 FR 31033 , July 26, 1989;  66 FR 33206 , June 21, 2001;  67 FR 17014 , Apr. 9, 2002]