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Telecom Order CRTC 2005-25
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Ottawa, 18 January 2005
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Cochrane Telecom Services
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Reference: Tariff Notice 46
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Business individual and business rural line rate increase
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1.
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The Commission received an application by Cochrane Telecom Services (Cochrane), dated 15 October 2004, to revise item 4.0, Rate Schedules for Primary Exchange (Local) Service, under section 100 of its General Tariff in order to increase its monthly business individual line and business rural line (South Highway) rates from $36.00 to $39.00.
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2.
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Cochrane submitted that the proposed rates were necessary to offset the reduction of the long distance subsidy and to bring parity to other business line rates presently being billed by Cochrane for $44.00. Cochrane submitted that the proposed rates would be competitive with the business rates of NorthernTel, Limited Partnership, and Ontera (formerly known as O.N.Telcom).
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3.
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The Commission received no comments with respect to the application.
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4.
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In Regulatory framework for the small incumbent telephone companies, Decision CRTC 2001-756, 14 December 2001 (Decision 2001-756), the Commission grouped services into four separate baskets, each with their own pricing constraints. The Commission assigned business individual, multi-line and party line services and all mandatory local services to the second service basket.
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5.
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In Decision 2001-756, the Commission determined that the rates for services that were included in the first and second service baskets would be permitted to increase each year by no more than inflation in the absence of exogenous factors. The Commission directed the small incumbent telephone companies whose monthly business rates were below $22.75 to file for approval proposed increases in business rates to reach a minimum of $22.75. The Commission stated, however, that in the event that a company considered a monthly business rate of $22.75 or its existing rate to be too low, it could file, for approval, proposed monthly business rates beyond the level of $22.75. The Commission indicated that all such proposals should be accompanied by supporting rationale and would be considered on a case by case basis.
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6.
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In Cochrane Public Utilities Commission, Telecom Order CRTC 2003-397, 30 September 2003, the Commission approved a rate increase for Cochrane's business lines from $31.00 to $36.00 per month. The Commission notes that Cochrane stated that the rate increase was necessary to offset the subsidy reduction over the next three years in order to recover the lost revenues and to meet its financial obligations. The Commission found that Cochrane's rationale provided in support of its proposed rates was reasonable, and the rates became effective on 30 September 2003.
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7.
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The Commission notes that Cochrane already increased its rates by $5.00 to compensate for a subsidy reduction and loss of revenues in 2003. The Commission further notes that it approved no exogenous factors for Cochrane in 2004. Accordingly, the Commission considers that Cochrane should be limited to a rate increase equal to the rate of inflation for 2004, as stated in Decision 2001-756. The Commission notes that the inflation rate for 2004 is 3.4 percent, which equates to a business line rate increase for Cochrane of $1.22 per month.
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8.
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The Commission therefore approves the increase of Cochrane's business individual line and business rural line (South Highway) rates from $36.00 to $37.22 per month. The revisions take effect on 1 February 2005.
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9.
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Cochrane is to issue revised tariff pages forthwith to reflect these changes.
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Secretary General
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This document is available in alternative format upon request and may also be examined at the following Internet site: http://www.crtc.gc.ca
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Date Modified: 2005-01-18