Sec. 60.064. RECOVERY OF COST OF PROVIDING SERVICE

(a) An incumbent local exchange company shall demonstrate that the price it charges for retail service recovers the cost of providing the service.

(b) For purposes of this section, the cost of providing the service is the sum of:

(1) each specifically tariffed premium rate for each noncompetitive service or service function, or each element of a noncompetitive service or service function, or the functional equivalent, that is used to provide the service;

(2) the total service long run incremental cost of the competitive services or service functions that are used;

(3) each cost, not reflected in Subdivision (1) or (2), that is specifically associated with providing the service or group of services; and

(4) each cost or surcharge associated with an explicit subsidy applied to all providers of the service to promote universal service.

Acts 1997, 75th Leg., ch. 166, Sec. 1, eff. Sept. 1, 1997.