NEWSReport No.  CC 95-11                          COMMON CARRIER ACTIONJanuary 31, 1995 

          DEPRECIATION RATES PRESCRIBED FOR FOUR PRICE CAP LECS

     The Commission has prescribed depreciation rates, effective January 1, 1994, for four
local exchange carriers (LECs) that are regulated under price caps.  The LECs affected by this
Order are:  Bell Atlantic - District of Columbia, Inc.; Bell Atlantic-Virginia, Inc.; Bell
Atlantic-West Virginia, Inc., and U S WEST Communications, Inc. 

     These carriers' depreciation rate proposals are based on either of two review
procedures, that is, they are based on either the previously established annual update
procedures or the newly established streamlined "range" procedures.  LECs have the
flexibility of using either of these procedures when requesting revised depreciation rates.  For
most of the accounts, the carriers filed for changes in rates using the annual update
procedures that have been in effect for many years.   Under these procedures the carrier
merely updates the rate calculations based on the life and salvage estimates that underlie the
most recent Commission depreciation prescription orders.  The Commission reviewed the
carriers' proposals and determined that, for these accounts, the carriers computed the rates in
accordance with established procedures and therefore, the Commission adopted them.

     For the remainder of the accounts, the carriers proposed depreciation rates determined
using the streamlined range procedures.  Under these procedures, the carriers are able to
select life and salvage factors within the ranges established by the Commission, provided that
the proposals are consistent with the carriers' operations.  After reviewing the carriers'
responses to our request, the Commission concluded that Bell Atlantic, for all the accounts for
which it requested the use of ranges, and U S WEST, for five accounts, have considered the
relevant factors and made a good faith effort to propose life and salvage factors which are
consistent with their operations.  The Commission further concluded that the carriers have
selected life and salvage factors within the established ranges for the accounts indicated, and
that they have computed rates consistent with those factors and the Commission's straight-line
remaining life depreciation methods.  Therefore, the Commission adopted the depreciation
rates for the remaining accounts.  It did not adopt the proposed depreciation rates for the
other range accounts of U S WEST.  Rather, the revised rates were calculated using the
current annual update procedures.

     Action by the Commission January 30, 1995, by Memorandum Opinion and Order
(FCC 95-37).  Chairman Hundt, Commissioners Quello, Barrett, Ness and Chong. 
                                  - FCC -    
     News Media contact: Rosemary Kimball at (202) 418-0500.
     Common Carrier Bureau contacts: Fatina K. Franklin at (202) 418-0840 and Stephen
Steckler at (202) 418-0865.