Order CRTC 2001-598

Ottawa, 26 July 2001

Reference: 8695-C12-16/01

The Commission denies Télébec's request to update its final 2001 contribution requirement at a later date in order to include the costs to implement local competition.

The Commission directs Télébec to issue revised tariff pages within 15 days to reflect the final 2001 contribution rate.

1.

Télébec ltée filed its proposed final 2001 contribution requirement and rate on 30 April 2001.

2.

Interested parties did not file comments.

Contribution-eligible minutes

3.

Télébec provided an estimate of 733 million contribution-eligible minutes for the year 2001.

4.

The Commission finds Télébec's proposed contribution-eligible minutes to be reasonable for the purpose of calculating the final 2001 contribution rate.

Costs to implement local competition

5.

In a letter dated 2 May 2001, Télébec requested that it be allowed to update its final 2001 contribution requirement at a later date in order to include the costs to implement local competition in its territory.

6.

The issue of local competition is being reviewed in a separate proceeding under Public Notice CRTC 2001-24, Competition in the local exchange and local payphone markets in the territories of Québec-Téléphone and Télébec ltée, dated 9 February 2001.

7.

The Commission denies Télébec's request to include the costs to implement local competition in the final 2001 contribution requirement. The methodology to determine the recovery of these costs will be considered within the scope of the PN 2001-24 proceeding.

Contribution requirement and rate

8.

Télébec filed its proposed final 2001 contribution requirement using the approved mid-point rate of return on average common equity (ROE) of 11.4%.

9.

Télébec's proposed final 2001 contribution requirement was $27.3 million for a corresponding contribution rate of $0.0372. This rate represents a decrease from the final 2000 contribution rate of $0.0399.

10.

The Commission notes that Télébec was able to absorb $4.2 million in new costs within the Utility segment as a result of Decision CRTC 2000-745, Changes to the contribution regime, dated 30 November 2000.

11.

Télébec's proposed final 2001 contribution rate continues to respect the rate cap established in Order CRTC 2000-861, Télébec 1999 final contribution rate approved, dated 19 September 2000.

12.

The Commission approves Télébec's contribution requirement of $27.3 million and rate of $0.0372, on a final basis, as filed.

Implementation

13.

In light of the foregoing, the Commission orders that Télébec issue revised tariff pages within 15 days of the date of this order to reflect the approved contribution rate.

Secretary General

This document is available in alternative format upon request and may also be examined at the following Internet site: http://www.crtc.gc.ca