SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 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): May 12, 1995
NYNEX CORPORATION
A Delaware Commission File I.R.S. Employer Identification
Corporation Number 1-8608 No. 13-3180909
1095 Avenue of the Americas, New York, New York 10036
Telephone Number (212) 395-2121
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Form 8-K NYNEX CORPORATION
May 12, 1995
Item 5. Other Events
STATE REGULATORY MATTERS
Massachusetts
On May 12, 1995, the Massachusetts Department of Public
Utilities ("MDPU") issued an order approving with some
modifications the Alternative Regulatory Plan ("Plan")
proposed by New England Telephone and Telegraph Company
("New England Telephone") to govern its Massachusetts
intrastate operations. The principal components of the
Plan are as follows:
(1)New England Telephone will be regulated under a
price framework through August 2001.
(2)Pricing rules will limit New England Telephone's
ability to increase both overall average prices and
specific rate elements for most services, including
a ceiling on the weighted average price of all
tariffed services based on a formula of inflation
minus a productivity factor plus or minus exogenous
changes that affect New England Telephone's annual
revenues by at least $3 million. The productivity
factor adopted by the MDPU is more stringent than
that recommended by New England Telephone and may
be increased if quality of service standards are
not met.
(3)There will be no restriction on New England
Telephone's earnings.
(4)Certain residence exchange rates will be capped
through August 2001.
(5)There will be an increase of $2.50 monthly in the
credit on exchange services for Lifeline customers.
(6)There will be rate reductions for switched access
services.
The MDPU found, without judging the reasonableness of
the investments, that New England Telephone could
proceed with its investment commitments for the public
telecommunications network, including commencing the
deployment of a broadband network in Massachusetts.
The MDPU ordered that New England Telephone's first
annual price cap filing be made by July 1, 1995, for
effect September 15, 1995. The filing must include
explicit cost floors for each of New England
Telephone's services. Prices for all services must
exceed their respective cost floors by the second
annual price cap filing.
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Form 8-K NYNEX CORPORATION
May 12, 1995
Item 5. Other Events (Continued)
STATE REGULATORY MATTERS
Maine
On May 15, 1995, the Maine Public Utilities Commission
("MPUC") issued Orders in its investigation of
alternatives to traditional rate of return regulation
for New England Telephone and in a related earnings
investigation. The MPUC adopted a price cap plan for a
five-year term, with the provision for a five-year
extension after review by the MPUC. There will be no
restriction on New England Telephone's earnings.
Overall average prices and specific rate elements for
most services will be limited by a price cap formula of
inflation minus a productivity factor plus or minus
certain exogenous cost changes. The productivity
factor adopted by the MPUC is more stringent than that
recommended by New England Telephone. New England
Telephone is to make its first annual price cap filing
on December 1, 1996. The MPUC also established a
service quality index with penalties to apply if
service quality categories are missed. Penalties would
take the form of customer rebates and are subject to
annual limits of $1 million per service quality
category and $10 million overall.
In the related earnings investigation, the MPUC ordered
that New England Telephone's revenues be reduced by
$14.4 million annually. The MPUC stated that New
England Telephone may use up to $4 million of the
reduction "to reduce rates and/or provide additional
services or equipment to libraries and schools." The
MPUC also ordered a one-time customer credit of $2.8
million. The MPUC ordered that New England Telephone
file tariffs by June 1, 1995 to implement the customer
credit and $10.4 million of the overall reduction. New
England Telephone is to file its proposal with respect
to providing up to $4 million to Maine libraries and
schools by June 15, 1995.
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Form 8-K NYNEX CORPORATION
May 12, 1995
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, thereunto duly authorized.
NYNEX CORPORATION
By Morrison DeS. Webb
Morrison DeS. Webb
Executive Vice President,
General Counsel and Secretary
May 24, 1995
