(1) Revenues derived from nonexempted, regulated telecommunications services, whether
essential or nonessential, shall not be used to subsidize or otherwise give advantage
to any person providing an exempted service. The commission shall require a provider of any exempted service to keep separate
accounts, to allocate cost in accordance with procedures established by the commission,
and may require other acts that will assist the commission in enforcing this section. Any person requesting an exemption or providing a service exempted pursuant to KRS 278.512 shall have the burden of proof to show compliance with this requirement.
(2) (a) Except as provided in subsection (2)(b) of this section, any telecommunications
utility that willfully violates subsection (1) of this section shall be subject to
a penalty no greater than the revenue requirement effect of moneys determined to have
been misallocated in the violation. For the purpose of calculating the penalty under this section, the commission shall
not use a period longer than five (5) years.
(b) A local exchange carrier with fewer than thirty-five thousand (35,000) access
lines who willfully violates subsection (1) of this section shall be subject to the
penalties prescribed in KRS 278.990(1).
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