§ 54.1310   Expense adjustment.

   (a) [Reserved]

   (b) [Reserved]

   (c) Beginning January 1, 1988, for study areas reporting 200,000 or
   fewer working loops pursuant to § 54.1305(h), the expense adjustment
   (additional interstate expense allocation) is equal to the sum of
   paragraphs (c)(1) through (2) of this section.

   (1) Sixty-five percent of the study area average unseparated loop cost
   per working loop as calculated pursuant to § 54.1309(b) in excess of
   115 percent of the national average for this cost but not greater than
   150 percent of the national average for this cost as calculated
   pursuant to § 54.1309(a) multiplied by the number of working loops
   reported in § 54.1305(h) for the study area; and

   (2) Seventy-five percent of the study area average unseparated loop
   cost per working loop as calculated pursuant to § 54.1309(b) in excess
   of 150 percent of the national average for this cost as calculated
   pursuant to § 54.1309(a) multiplied by the number of working loops
   reported in § 54.1305(h) for the study area.

   (d) Beginning April 1, 1989, the expense adjustment calculated pursuant
   to § 54.1310(c) shall be adjusted each year to reflect changes in the
   amount of high-cost loop support resulting from adjustments calculated
   pursuant to § 54.1306(a) made during the previous year. If the
   resulting amount exceeds the previous year's fund size, the difference
   will be added to the amount calculated pursuant to § 54.1310(c) for the
   following year. If the adjustments made during the previous year result
   in a decrease in the size of the funding requirement, the difference
   will be subtracted from the amount calculated pursuant to § 54.1310(c)
   for the following year.

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