(a) A LEC may recover the incremental costs necessary for the implementation of toll dialing parity. The LEC must recover such costs from all providers of telephone exchange service and telephone toll service in the area served by the LEC, including that LEC. The LEC shall use a cost recovery mechanism established by the state.
(b) Any cost recovery mechanism for the provision of toll dialing parity pursuant to this section that a state adopts must not:
(1) Give one service provider an appreciable cost advantage over another service provider, when competing for a specific subscriber (i.e., the recovery mechanism may not have a disparate effect on the incremental costs of competing service providers seeking to serve the same customer); or
(2) Have a disparate effect on the ability of competing service providers to earn a normal return on their investment. [61 FR 47350, Sept. 6, 1996]