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Abstract
NECA argues that it needs the revisions to account for $15 million in revenue that is likely to go uncollected by small ILECs. NECA's existing tariffs anticipate only $15,000 in uncollectible revenue. The revised filing "addresses an unexpected shortfall in the uncollectible reserve" for the period from July 1, 2002, to June 30, 2003, NECA said.
IXCs, which would bear the brunt of the access rate increases, dispute NECA's figures. The "inflated estimate" of future uncollectibles "is rife with methodological flaws," AT&T Corp. said in comments filed Dec. 16. The estimate is based on "unrealistic assumptions that the rate of default among carriers will continue at extraordinarily high levels and that NECA carriers will collect nothing in bankruptcy proceedings."
The National Telecommunications Cooperative Association, which represents rural ILECs, supported NECA. The "significant increase" in uncollectibles "cannot be attributed to normal business fluctuations brought on by the bankruptcy filings of a few large interexchange carriers, but rather is a symptom of the financial weakness in the interstate access business," NTCA said.
'There is no evidence that the ILECs require any protections in addition to those permitted by current tariffs," WorldCom representatives said in a summary of their presentation. "In particular, there is no evidence that the ILECs' uncollectible rate is higher than that of competitive carriers or that the ILECs have been more exposed to customer bankruptcies than competitive carriers."