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SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): December 24, 1993
NYNEX CORPORATION
A Delaware Commission File I.R.S. Employer Identification
Corporation Number 1-8608 No. 13-3180909
335 Madison Avenue, New York, New York 10017
Telephone number (212) 370-7400
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Form 8-K NYNEX Corporation
December 24, 1993
ITEM 5. Other Events.
In the first phase of a proceeding that was instituted to consider
the possible development of a performance-based regulation plan for
New York Telephone Company (the "Company"), on December 24, 1993 the
New York State Public Service Commission ("NYSPSC") issued an Order,
pending a full opinion, for a reduction in the Company's rates of
$170 million, to be effective January 1, 1994. The reduction is
intended to reduce the Company's intrastate revenues by $141 million
annually. In addition, the NYSPSC Order determined that an
additional $159 million of current revenues are to be made available
"for the ultimate benefit of customers and the Company's competitive
position through earnings incentives for short-term service
improvements and a longer term plan for performance-based earning
incentives and network improvements". That plan will be pursued in
a second phase of the proceeding.
The Order did not make a final finding on return on equity. Subject
to the Company's achieving net productivity gains, the rates adopted
by the Order would, according to the Order, allow the Company an
opportunity to earn above a 10.8% return on equity. There will also
be equal sharing between shareholders and ratepayers of any earnings
above 12% return on equity.
A full opinion explaining the basis of the Order will be issued
shortly. It is expected that this opinion will also address the
Company's treatment of deferred expenses related to various early
retirement programs. It is probable that the opinion will require
the Company to incur a charge to income in 1993 of $49 million
after-tax. This charge represents a reversal of a portion of the
Company's deferred regulatory asset related to pension costs. These
costs, which the Company previously expected to recover through the
regulatory process, were deferred, and the asset was created, under
the provisions of Statement of Financial Accounting Standards No. 71
- Accounting for the Effects of Certain Types of Regulation.
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Form 8-K NYNEX Corporation
December 24, 1993
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
NYNEX Corporation
By P. M. Ciccone
P. M. Ciccone
Vice President and Comptroller
January 12, 1994
