The Kansas Court of Appeals reversed lower state courts and ruled...
The Kansas Court of Appeals reversed lower state courts and ruled rural local exchange carriers aren’t entitled to two years’ interest on restored support payments initially lost from the state universal service fund in a subsidy formula adjustment. The…
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case goes back to 2003, when state courts struck down the adjusted state formula for calculating per-line support to rural rate-of-return companies serving sparsely-populated areas. That decision stood in an April 2005 appeals court ruling and the matter was remanded to the Corporation Commission to revise the formula. The commission ended up returning to the original unadjusted formula, restoring the prior support levels in 2006 and releasing $3.5 million in restoration payments to affected telcos. The companies sued, saying they were entitled to two years’ interest on the restored amounts, and won at the trial court level. The commission appealed. The appeals court (Case 98- 705) said the telcos weren’t entitled to interest because the matter wasn’t finally decided until the commission fulfilled the remand and set the restoration payment amount. The appeals court said there was no way to determine what interest would be until the commission acted on the remand. Interest would be owed from the date the commission finally acted, but not for the two years while the matter was in flux, the court said.