[2] See Bell Atlantic Telephone Companies Offer of Comparably Efficient Interconnection to Providers of Internet Service, Order, CCBPol 96-09, DA 96-891, at para. 1 (released June 6, 1996) ("Prior to offering the enhanced service, the carrier must obtain Commission approval of the CEI plan. . . . we approve Bell Atlantic's CEI plan.").

[3] See SWBT's Comments filed on October 10, 1995 (SWBT NPRM/NOI Comments), in response to the Notice of Proposed Rulemaking and Notice of Inquiry in Amendment of Part 36 of the Commission's Rules and Establishment of a Joint Board, CC Docket No. 80-286, 10 FCC Rcd 12309 (1995).

[4] Assuming USF is kept in place, SWBT believes that for larger LECs, support should be maintained through rate restructuring. The most sustainable restructuring would be to phase-in

increases to the interstate EUCL in areas where interstate common line costs are not recovered by the current EUCL. If there is a transition period, the CCL and, if necessary, the USF, would be bulk billed.

[5] See footnote 4.

[6] For instance, if in a universal service area the overall support requirement was $20 per loop per month, a new entrant could selectively provide facilities to secure higher volume, lower cost customers in that portion of the area where only $5 per loop per month is required. Competitive bidding would allow the new entrant to bid that $5 per loop per month, thus causing the overall support for the universal service area to be $5 per loop per month. The result is that the incumbent LEC, which is required to provide facilities to serve all of the higher cost customers (either to provide service directly or which are used by the new entrant to provide service) no longer secures "sufficient" support to maintain universal service to those higher cost customers. Competitive bidding where the new entrant is permitted to construct facilities to serve only a few lower cost customers in an area will result in manipulation of support levels for competitive reasons, will result in insufficient support, will have a detrimental effect on universal service, and should be rejected.

[7] This analysis assumes the use of interstate costs assigned to the Common Line - Base Factor Portion Elements through the use of 47 C.F.R. Part 36, Separations and Part 69, Access Charge costs methods. Parts 36 and 69 are fully-distributed cost methods. This analysis does not take into account any cost recovery that is generated from intrastate local, access and toll services, but is simply designed to demonstrate the types and the approximate magnitude of the of support flows that are generated by the interstate CCL.