Cost Review Proceeding for Residential and Single-Line Business Subscriber Line Charge (SLC) Caps

This document concludes the cost review proceeding to verify that increases to the subscriber line charge (SLC) cap above $5.00 are appropriate. The SLC is a flat-rated charge imposed by local telephone service providers on end users to recover the interstate-allocated portion of local loop costs. In 2000, the Commission adopted a schedule to reduce the implicit subsidies in access rates while gradually increasing the cap on the SLC. The Commission stated that it would conduct a cost review proceeding prior to the scheduled cap increases above $5.00. Based on the record before us, we conclude that the increases are appropriate--and indeed necessary--to fulfill the Commission's access charge reform objectives. Therefore, the SLC cap will increase as scheduled in the Commission's rules, to $6.00 on July 1, 2002, and to $6.50 on July 1, 2003.