(1) (Deleted by amendment, L. 2008, p. 1703, § 3, effective June 2, 2008.) (2) (a) (I) The commission is hereby authorized to establish a mechanism for the support of universal service, also referred to in this section as the "high cost support mechanism", which must operate in accordance with rules adopted by the commission. The primary purpose of the high cost support mechanism is to provide financial assistance as a support mechanism to: (A) Help make basic local exchange service affordable and allow for reimbursement to providers, as specified in subsections (2)(a)(IV) and (4) of this section; and (B) Provide access to broadband service in unserved and underserved areas pursuant to this section and section 24-37.5-905 only. (II) The high cost support mechanism shall be supported through a neutral assessment on all telecommunications providers in Colorado. (III) The commission shall maintain the rate of the high cost support mechanism surcharge at the surcharge rate established as of January 1, 2018; except that, on and after July 1, 2023, the commission may reduce the surcharge rate to ensure that the amount of money collected does not exceed twenty-five million dollars in calendar year 2024. (IV) The commission shall allocate to the high cost support mechanism account dedicated to broadband deployment, on a quarterly basis and by the end of the month following the previous quarter, the following percentages of the total quarterly amount of high cost support mechanism money collected, minus administrative costs and distributions required under subsection (4) of this section: (A) to (C) (Deleted by amendment, L. 2024.) (D) For each quarter in 2022, ninety percent; (E) For each quarter in 2023 and for each quarter in each subsequent year, one hundred percent. (V) The nonrural incumbent local exchange carrier will receive, on a quarterly basis and by the end of the month following the previous quarter, the balance of the remaining quarterly high cost support mechanism collections after the distributions required by subsections (2)(a)(IV) and (4) of this section have been made. (VI) In accordance with subsection (2)(a)(IV) of this section, the commission, in making distributions of high cost support mechanism money in the years 2019 through 2023, shall neither: (A) Make effective competition determinations; nor (B) Apply any section of this article 15 that requires an effective competition determination be made or that in any way conflicts with subsections (2)(a)(IV) and (4) of this section with regard to the distributions. (b) Notwithstanding section 24-1-136 (11)(a)(I), on or before December 1 of each year, the commission shall submit a written report to the committees of reference in the senate and house of representatives that are assigned to hear telecommunications issues, in accordance with section 24-1-136, C.R.S., accounting for the operation of the high cost support mechanism during the preceding calendar year and containing the following information, at a minimum: (I) The total amount of money that the commission determined should constitute the high cost support mechanism from which distributions would be made; (II) The total amount of money ordered to be contributed through a neutral assessment collected by each telecommunications service provider; (III) The basis on which the contribution of each telecommunications service provider was calculated; (IV) The benchmarks used and the basis on which the benchmarks were determined; (V) The total amount of money that the commission determined should be distributed from the high cost support mechanism; (VI) The total amount of money distributed to each telecommunications service provider from the high cost support mechanism; (VII) The basis on which the distribution to telecommunications service providers was calculated; (VIII) As to each telecommunications service provider receiving a distribution, the amount received by geographic support area and type of customer, the way in which the benefit of the distribution was applied or accounted for; (IX) The proposed benchmarks, the proposed contributions to be collected through a neutral assessment on each telecommunications provider, and the proposed total amount of the high cost support mechanism from which distributions are to be made for the following calendar year; and (X) The total amount of distributions made from the high cost support mechanism, directly or indirectly, and how they are balanced by rate reductions by all providers for the same period and a full accounting of and justification for any difference. (c) If the report submitted pursuant to paragraph (b) of this subsection (2) contains a proposal for an increase in any of the amounts listed in subparagraph (IX) of said paragraph (b), such increase shall be suspended until March 31 of the following year. (d) Repealed. (e) In addition to the annual report submitted under paragraph (b) of this subsection (2) by the commission, the department of regulatory agencies shall include in its presentation to the appropriate legislative committee under the requirements of part 2 of article 7 of title 2, C.R.S., an update on the implementation and administration of the high cost support mechanism. (3) (a) There is hereby created, in the state treasury, the Colorado high cost administration fund, referred to in this section as the "fund", which shall be used to reimburse the commission and its contractors for reasonable expenses incurred in the administration of the high cost support mechanism, including administrative costs incurred in association with broadband service, as determined by rules of the commission. The general assembly shall appropriate annually the money in the fund that is to be used for the direct and indirect administrative costs incurred by the commission and its contractors. At the end of any fiscal year, all unexpended and unencumbered money in the fund remains in the fund and shall not be credited or transferred to the general fund or any other fund. Only the money in the high cost support mechanism that is necessary for administering the high cost support mechanism shall be transmitted to the state treasurer, who shall credit the same to the fund. All interest derived from the deposit and investment of money in the fund remains in the fund and does not revert to the general fund. (b) Repealed. (c) Notwithstanding any provision of paragraph (a) of this subsection (3) to the contrary, on July 31, 2009, the state treasurer shall deduct from the fund an amount equal to the amount transferred to the fund pursuant to Senate Bill 09-272, enacted in 2009, and transfer such amount to the general fund. (4) Notwithstanding any other provision to the contrary in sections 40-15-207 and 40- 15-502 or this section, rural telecommunications providers receiving support from the high cost support mechanism as of January 1, 2017, will continue to receive support, on a quarterly basis and by the end of the month following the previous quarter, at the same level of reimbursement established by averaging the payments received for calendar years 2015 and 2016, beginning on January 1, 2019, and continuing each quarter in each subsequent year. The commission shall administer the high cost support mechanism to ensure compliance with this section. (5) On or before December 31, 2018, the commission shall establish a plan to eliminate, on an exchange-area-by-exchange-area basis, obligations imposed pursuant to sections 40-15- 401 (1)(b)(IV) and 40-15-502 (5)(b) and (6)(a) consistent with the reductions in the high cost support mechanism distributions for basic service pursuant to subsection (2)(a)(IV) of this section. (6) Repealed.
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