Texas Gov. George Bush on May 26 signed into law a comprehensive bill, H.B. 2128, that makes sweeping changes in the way the state regulates telecommunications. The bill allows competitors to provide local exchange services by obtaining a certificate of operating authority (COA) or to resell local services through a service-provider certificate of operating authority. The COA is designed for facilities-based local exchange, and requires competitors to serve customers within a 27-square-mile area within 30 days of customer request.
The Texas Public Utilities Commission (PUC) will establish a "transitional flexibility plan" for incumbent local exchange carriers in the area where a competitor operates. The PUC will have authority to deregulate prices in areas where it finds the incumbent no longer dominant, based on a market-power test.
The legislation sets 10 policy goals for development of an advanced telecommunications infrastructure; companies that elect incentive regulation must meet certain infrastructure goals.