Sec. 69.603  Association functions.

    (a) The Association shall not engage in any activity that is not 
related to the preparation of access charge tariffs or the collection 
and distribution of access charge revenues or the operation of a billing 
and collection pool on an untariffed basis unless such activity is 
expressly authorized by order of the Commission.
    (b) Participation in Commission or court proceedings relating to 
access charge tariffs, the billing and collection of access charges, the 
distribution of access charge revenues, or the operation of a billing 
and collection pool on an untariffed basis shall be deemed to be 
authorized association activities.
    (c) Upon the incorporation and commencement of operations by the 
association's independent subsidiary that, pursuant to Sec. 69.613(a), 
will administer temporarily specified portions of the universal service 
support mechanisms, the association shall no longer administer the 
Universal Service charge, including the direct billing to and collection 
of associated revenues on a monthly basis from interexchange carriers 
pursuant to Sec. 60.116 of this chapter and the distribution of these 
revenues to qualified telephone companies based on their share of 
expenses assigned to the Universal Service Factor portion of the 
interstate allocation pursuant to Sec. 36.631 of this chapter. Such 
functions shall be assumed by the independent subsidiary of the 
association as provided in Sec. 69.613. Commencing on January 1, 1998, 
the billing and collection of universal service support for high cost 
areas shall be performed in a manner consistent with Sec. 54.709 of this 
chapter.
    (d) Upon the incorporation and commencement of operations by the 
association's independent subsidiary that, pursuant to Sec. 69.613, will 
administer temporarily specified portions of the universal service 
support mechanisms, the association shall no longer administer the 
Lifeline Assistance charge, including the direct billing to and 
collection of associated revenues on a

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monthly basis from interexchange carriers pursuant to Sec. 69.117, and 
the distribution of these revenues to qualified telephone companies 
based on their share of expenses assigned to the Lifeline Assistance 
Fund pursuant to Sec. 36.741 of this chapter and of End User Common Line 
charges associated with the operation of Sec. 69.104(j) through (l). 
Such functions shall be assumed by the independent subsidiary of the 
association as provided in Sec. 69.613. Commencing on January 1, 1998, 
the billing and collection of Lifeline support shall be performed in a 
manner consistent with Sec. 54.709 of this chapter.
    (e) Upon the incorporation and commencement of operations by the 
association's independent subsidiary that, pursuant to Sec. 69.613, will 
administer temporarily specified portions of the universal service 
support mechanisms, the association shall no longer compute, in 
accordance with Secs. 69.105 and 69.612, the mandatory Long Term Support 
payment of telephone companies that are not association Common Line 
tariff participants, bill or collect the appropriate amounts on a 
monthly basis from such telephone companies, or distribute Long Terms 
Support revenue among association Carrier Common Line tariff 
participants. Such functions shall be assumed by the independent 
subsidiary of the association as provided in Sec. 69.613. Commencing on 
January 1, 1998, the computation, billing, and collection of Long Term 
Support shall be performed in a manner consistent with Sec. 54.303 of 
this chapter.
    (f) The association shall also prepare and file an access charge 
tariff containing terms and conditions for access service and form for 
the filing of rate schedules by telephone companies that choose to 
reference these terms and conditions while filing their own access 
rates.
    (g) The association shall divide the expenses of its operations into 
two categories. The first category (``Category I Expenses'') shall 
consist of those expenses that are associated with the preparation, 
defense, and modification of association tariffs, those expenses that 
are associated with the administration of pooled receipts and 
distributions of exchange carrier revenues resulting from association 
tariffs, those expenses that are associated with association functions 
pursuant to Sec. 69.603 (c)-(g), and those expenses that pertain to 
Commission proceedings involving subpart G of part 69 of the 
Commission's rules. The second category (``Category II Expenses'') shall 
consist of all other association expenses. Category I Expenses shall be 
sub-divided into three components in proportion to the revenues 
associated with each component. The first component (``Category I.A 
Expenses'') shall be in proportion to the Universal Service Fund and 
Lifeline Assistance revenues. The second component (``Category I.B 
Expenses'') shall be in proportion to the sum of the association End 
User Common Line revenues, the association Carrier Common Line revenues, 
the association Special Access Surcharge revenues, the Long Term Support 
payments and the Transitional Support payments. The third component 
(``Category I.C Expenses'') shall be in proportion to the revenues from 
all other association interstate access charges.
    (h)(1) The revenue requirement for association tariffs filed 
pursuant to Sec. 69.4(c) shall not include any association expenses 
other than Category I.A Expenses.
    (2) The revenue requirement for association tariffs filed pursuant 
to Sec. 69.4 (a) and (b)(2) shall not include any Association expenses 
other than Category I.B Expenses.
    (3) The revenue requirement for association tariffs filed pursuant 
to Sec. 69.4(b) (1) and (3)-(7) shall not include any association 
expenses other than Category I.C Expenses.
    (4) No distribution to an exchange carrier of Universal Service Fund 
and Lifeline Assistance revenues shall include adjustments for 
association expenses other than Category I.A Expenses.
    (5) No distribution to an exchange carrier of revenues from 
association End User Common Line or Carrier Common Line charges, Special 
Access Surcharges or Long Term Support or Transitional Support payments 
shall include adjustments for association expenses other than Category 
I.B Expenses.
    (6) No distribution to an exchange carrier of revenues from 
association

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interstate access charges other than End User Common Line and Carrier 
Common Line charges and Special Access Surcharges shall include 
adjustments for association expenses other than Category I.C Expenses.
    (7) The association shall separately identify all Category I.A, I.B 
and I.C expenses in cost support materials filed with each annual 
association access tariff filing.

[ 54 FR 8197 , Feb. 27, 1989, as amended at  54 FR 8199 , Feb. 27, 1989;  62 FR 41306 , Aug. 1, 1997]