~..\,;i h i - This filing revises the following tariff sheets for Hardy Telecommunications, Inc. P.S.C. W.VA. Tariff No.7 - Local:

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1 Octber 9, 2014 TELECOMMUNICATIONS advantage netwrking VIA FAX WITH HARD COPY FOLLOW-UP OVERNIGHT MAIL Ms Ingrid Ferrell 201 Brks Street Charlestn, WV Re: Hardy Telecmmunicatins, Inc - ILEC Lcal Tariff - Residential Lcal Service Rate Increase ~ \,;i h i - Dear Ms Ferrell:!_, i, FIO ;d~ This filing revises the fllwing tariff sheets fr Hardy Telecmmunicatins, Inc PSC WVA Tariff N7 - Lcal: Lcal Tariff - PSC WVA N 7 / ij c PSC WVA N 7 4'h Revised Sheet N 22 Cancels PSC WVA N 7 3rd Revised Sheet N 22 The purpse f this filing is t increase Hardy Telecmmunicatin's Basic residential lcal service rate frm $IOOO/mnth t $1300/mnth and the Cmmunity Calling residential lcal service rate frm $15 OO/mnth t $1700/mnth Alng with the increased new residential basic rate, the basic plan will nw include $300/mnth f n-charge calling within custmer's Band 1 (hme exchange) and the cmmunity calling plan will include $200/mnth f n-charge calling cvered within ur Cmmunity Plus and Premium lcal calling plans The lcal rate increase filing is a direct result f the Federal Cmmunicatins Cmmissin ("FCC) increasing the lcal rate flr fr residential service that all ILECs must meet r lse federal High Cst Lp (HCL) Universal Service Fund (USF) supprt in the amunt by which the rate flrs exceed the Cmpany's lcal rates This change mandated by the FCC has directly impacted the Cmpany's surces f revenue frm USF supprt and t avid increased penalties in high cst fund supprt the Cmpany prpses t increase ur basic and cmmunity calling lcal service rate As a cperative, the Bard f Directrs has apprved the rate increase and the Cmpany will prvide ntice t all f its affected custmers f the rate change (sample letter enclsed) The Cmpany is requesting a December 1, 2014 effective date If yu have any questins relative t this filing, please cntact me as r tqratliff@hardynetcm Sincerely, Tracey G F%tliff Directr f Finances & Supprt Service 2255 Kimseys Run Rad Lst River, W a Vice: a Fax: Suth Main Street Mrefield,WV Vice: * Fax:

2 At a Special Bard Meeting n Friday, Octber 3, 2014, the Hardy Telecmmunicatins, Inc Bard f Directrs: Reslved that the Cmpany institute a rate increase fr the Basic Calling plan; Reslved that the pricing f Basic Calling plan shall be: $13 per mnth (increase frm the current $10 per mnth rate) And will cntinue t include the first $3 wrth f lcal calling within the hme exchange (Band 1) at n additinal charge Reslved that the Cmpany institute a rate increase fr the Cmmunity Calling plan; Reslved that the pricing f the Cmmunity Calling plan shall be: $17 per mnth (increase frm the current $15 per mnth rate) But, as f the effective date, the Cmmunity Calling plan shall nw include the first $200 wrth f lcal calling within Bands 3 & 4 at n additinal charge Reslved that the effective date f the rate increases fr the Basic Calling plan shall be December 1, 2014; Reslved that the Cmpany prceed with all necessary ntificatins, filings, and tariffs in accrdance with the rules f the West Virginia Public Service Cmmissin and that the Cmpany shall: Ntify all affected custmers (thse n recrd as f Octber 1, 2014), via a letter, f the increase and explaining the reasn fr the increase; Reslved that the Bard recgnizes that these increases are being instituted in rder t nt be adversely penalized by the Universal Service Fund fr having subscribers with calling plans with rates belw the $16 per subscriber, lcal benchmark rate as established by the Federal Cmmunicatins Cmmissin (FCC), and t be implemented n Jan 1; 2015; and be it further reslved that the Bard als recgnizes that the FCC has already published a future, lcal benchmark rate f $18 by July 1,2016, and thereby feels it must cntinue t incrementally raise thse calling plan rates as needed in rder t nt adversely affect the subscribing custmers with a ne-time significant increase because it als must nt cmprmise the cperative s financial stability either by being adversely penalized by the Universal Service Fund fr having rates t far belw the published, lcal benchmark rate, and; Reslved that the President and Secretaly f the Cmpany be authrized in the name and n behalf f the Cmpany, t sign this reslutin n behalf f the Cmpany & Date

3 HARDY TELECOMMUNICATIONS, INC PSC NO 7 4th Revised Sheet N 22 Cancels 3rd Revised Sheet N 22 RATES Basic Residence One Party Access** Cmmunitv Callinq Residence One Party Access*** Cmmunity Plus Residence One Party Access Premium Residence One Party Access NETWORK ACCESS LINE SERVICES Mnthlv Flat Rate $1300 (1) $2200 $1700 (1) $2500 $21 $5000 $2800 $6000 Lcal Service Usaqe Mnitrinq $ 500 Peak Time* Usaqe Charqes Fr All Plans, When ADplicable Band 1" Minute Additinal Minutes 1 $0043 $ $0052 $ $0060 $ $0069 $ $0086 $0057 Band 1 (Hme Exchange) - Lst River Band 2 (1-10 miles) - Mrefield Band 3 (11-16 miles) - Wardensville Band 4 (17-22 miles) -Augusta, Burlingtn, Maysville, Petersburg, Rmney Band 5 ( 23+ miles) - Brandywine Peak time usage is 9:00 am t 9:00 pm Mnday thrugh Friday Usage during ff peak time, anytime ther than peak time, is discunted 70 percent ** Basic residential calling plan rate includes $300 I m f calling within Band 1 (hme exchange) at n charge (N) *** Cmmunity Calling residential calling plan rate includes $200 I m f calling within Bands 3 and 4 at n charge (N) Issued by authrity f an rder f the Public Service Cmmissin f West Virginia in Case N T-T, dated Octber 31, 2012 Issued: Nvember 30,2014 D Sctt Sherman Effective: December 1,2014 General ManagerKEO

4 TELECOMMUNICATIONS Nvember 1,2014 Custmer Name Custmer Address City, State, ZIP Dear (Custmer Name): Because the Federal Cmmunicatins Cmmissin is increasing minimum lcal rates fr basic telephne service, we are writing this letter t infrm yu that we will he instituting a rate increase fr ur Basic and Cmmunity Calling service plans effective December 1, 2014 The new rate fr Basic will be $13 a mnth, up frm $10; the new rate fr Cmmunity Calling will be $17 a mnth, up frm $1 5 The FCC has set a lcal benchmark rate f $1 6 per mnth fr Basic service effective January 1,2015 Simply put, Hardy Telecmmunicatins will cntinue t lse federal Universal Service Fund mney even after this increase, because ur Basic calling rate will still be $3 less per mnth than the federal benchark rate Hardy will be penalized fr having a Basic calling plan rate that is belw the FCC rate Despite a rate increase tw years ag, Hardy is paying a penalty right nw with lst Universal Service Fund mney because the FCC already has a higher benchmark rate than Hardy s current rate With yet anther FCC increase cming in January, the Hardy bard f directrs decided that it wuldn t be financially feasible t pay still mre increased penalties and lse even mre federal funding The $3 per mnth increase in the Basic calling plan rate is designed t balance the financial status f the cmpany with cncern fr ur custmers and the burden that an increase can create That is why we will cntinue t pay sme penalty and nt raise rates t equal the FCC lcal benchmark rate While yur ttal telephne bill currently is mre than the Basic charge f $10, many f the charges n yur bill are mandated fees and charges that d nt g t Hardy, but instead are passed n t the prper gvernment agency The FCC des nt cunt these mandated fees and charges in determining cmpliance with its new regulatins The new Basic residential calling rate will cntinue t include $3 wrth f calling within yur hme exchange at n charge Members in the 897 exchange, fr example, have $3 wrth f free calling t thers in the 897 exchange; members in the 434 exchange have $3 wrth f free calling t thers in the 434 exchange, and s n The new Cmmunity Calling residential calling rate will nw include $2 wrth f lcal calling t Hardy service areas cvered under the Cmmunity Calli 2255 Kimseys Run Rad Lst River, WV Vice: * Fax: Suth Main Street * Mrefield, WV Vice: Fax:

5 calling plans Regular per-minute charges will apply after the first $2 wrth f lcal calling In the past, the Cmmunity Calling plan did nt include any free calling t ther Hardy service areas We d like t further explain the reasn fr this change The FCC and the funding mechanisms thrugh which Hardy receives Universal Service Fund reimbursements have set natinal benchmark rates fr lcal telephne service The FCC benchmark rates are increasing t $16 n January 1,2015 If a cmpany is nt charging that minimum amunt fr lcal telephne service, the cmpany lses funding Hardy s rates currently are belw thse benchmarks, and the FCC s cming rate hike will increase that difference In essence, the federal gvernment has tld Hardy that it is nt charging enugh fr basic telephne service in rder t cntinue t receive full USF supprt Therefre, ur funding will be further reduced unless ur rates are increased t be mre in line with the federal benchmarks Hardy has made the decisin t still pay a penalty in reduced funding even after this increase, because ur rates will still be belw the FCC benchmarks Our hpe is that this will ease the burden fr custmers The FCC has publicly stated plans fr still mre increases in the lcal benchmark rate, and the cmpany will have t cntinue t mnitr thse As we nted earlier, many f the charges n yur current telephne bill are mandated gvernment fees and charges Hardy currently charges $10 fr the Basic calling plan That amunt is increasing t $1 3 Hwever, many f the ther charges n a typical Hardy bill - Subscriber Res Line Charge, Hardy Cunty 91 1 Surcharge, Federal Excise Tax, Federal Universal Service Fund, Telecmmunicatins Relay Service - are mandated charges and Hardy simply passes them n t the apprpriate gvernment agency These charges typically add $10-$13 t the ttal Hardy bill The FCC des nt cunt these additinal charges in its lcal benchmark rates Therefre, Hardy s current rate f $10 falls belw the FCC s natinal lcal benchmark The rts f the Universal Service Fund trace back t the Cmmunicatins Act f 1934, when the federal gvernment established a plicy that all Americans, regardless f where they live, are entitled t mdem, affrdable telephne service All citizens wh have telephne service pay a USF charge That mney is then distributed t help reimburse cmpanies wh prvide telephne service in high-cst areas In recent years, hwever, the gvernment has cntinually cut that funding, resulting in Hardy Telecmmunicatins receiving several hundred thusand dllars less than in previus years Hardy Cunty is a high-cst area due t lw ppulatin and challenging terrain In a city, a cmpany can have thusands f custmers in a square mile Hardy Telecmmunicatins has areas with tw custmers per square mile Many larger telecmmunicatins cmpanies wn t prvide service in such rural areas Our cperative was frmed fr exactly that reasn, because the larger prviders had n interest in serving an area with s few custmers There just aren t enugh custmers t make up fr the expenses f prviding service in such a muntainus area, and it is unrealistic t expect custmers t pay the full csts That was the idea behind Universal Service, t reimburse thse csts t a cmpany like Hardy, but nw the gvernment is

6 requiring that increased minimum charges be assessed in rder t receive full USF funding Hardy is raising its rates t be mre in line with thse required minimum charges but still is knwingly keeping its rates belw that minimum, seeking t maintain a balance between csts t ur custmers and lsses in federal funding due t being penalized We strive t keep ur rates as lw as pssible, and we aplgize fr any incnvenience this increase might create We appreciate yur business and yur patience as we cmply with these new federal regulatins If yu have any questins, please cntact either ur Lst River ffice at r ur Mrefield ffice at Sincerely, Hardy Telecmmunicatins Bard f Directrs Greg Zirk, President Hardy General Manager D Sctt Sherman Hardy Telecmmunicatins is an equal ppstuniq prvider and emplyes