19990916Decision Memo.doc

DECISION MEMORANDUM

TO: COMMISSIONER HANSEN
COMMISSIONER SMITH
COMMISSIONER KJELLANDER
MYRNA WALTERS
RON LAW
TONYA CLARK
LYNN ANDERSON
DON HOWELL
STEPHANIE MILLER
JOE CUSICK
DOUG COOLEY
BEV BARKER
WORKING FILE

FROM: CHERI C. COPSEY

DATE: SEPTEMBER 16, 1999

RE: CENTURYTEL OF IDAHO, INC. REVISION TO IDAHO RURAL EXCHANGE CARRIERS TARIFF NO. 2 – EQUAL ACCESS RECOVERY CHARGE – CASE NO. CEN-T-99-2.

On July 13, 1999, CenturyTel of Idaho, Inc. filed a revision to its Idaho Rural Exchange Carriers Tariff No. 2 adding an equal access recovery charge (EARC). The EARC adds the terms, conditions and rates for providing intraLATA toll dialing parity in Idaho pursuant to the Commission’s Order No. 28066. On August 5, 1999, the Commission issued a, the Notice of Application and Notice of Modified Procedure. Order No. 28112.
On August 26, 1999, the Commission Staff filed Comments recommending the Tariff Advice be approved. No other person filed Comments.
CenturyTel proposes that incremental expenses relating to intraLATA toll dialing implementation (EARC) be recovered through a surcharge of $0.006873 per originating intraLATA access minute imposed on the participating intraLATA interexchange (IXC) companies over a 24-month period beginning August 13, 1999.
BACKGROUND
CenturyTel offers local telephone exchange service in the Idaho exchanges of Leadore and Salmon. On April 22, 1999,. CenturyTel filed an Application with the Commission for an Order approving its intrastate, intraLATA toll dialing parity implementation plan. On June 8, 1999, in Case No. CEN-T-99-1, the Commission approved CenturyTel’s Application as modified. See Order 28066.
On July 13, 1999, CenturyTel of Idaho, Inc. filed a revision to its Idaho Rural Exchange Carriers Tariff No. 2 adding an equal access recovery charge (EARC). The EARC adds the terms, conditions, and rates for providing intraLATA toll dialing parity in Idaho pursuant to the Commission’s Order No. 28066. CenturyTel proposed that incremental expenses relating to intraLATA toll dialing implementation (EARC) be recovered through a surcharge of $0.006873 per originating intraLATA access minute imposed on the participating intraLATA interexchange (IXC) companies over a 24-month period beginning August 13, 1999. In response, the Commission suspended the Tariff Advice for a period of thirty (30) days, or until such time as the Commission may issue an Order accepting or rejecting or modifying the Tariff Advice. Order No. 28112.
There are costs associated with implementing dialing parity and local exchange carriers are allowed to recover those costs, called Equal Access Recovery Charges (EARC), from the participating interexchange carriers. The Commission did not address the amount of the EARC in Order No. 28066. This proposed revision to the Idaho Rural Exchange Carriers Tariff No. 2 sets forth the proposed EARC in conformance with Order No. 28066.
STAFF RECOMMENDATION:
Staff supported CenturyTel’s proposed dialing parity costs and method for recovery. Staff believes that, in accordance with FCC 96-333 and DA 98-2534, CenturyTel’s method of recovery from all intraLATA toll providers is competitively neutral and that these incremental costs would not have been incurred “but for the implementation of dialing parity.” Because dialing parity creates equal access to intraLATA toll, Staff believes that cost recovery based on intraLATA toll usage is reasonable. Staff accepted the 24-month recovery period but recommended a review period at the end of the first year to determine the effectiveness and, if necessary, to adjust the recovery rate.
Therefore, Staff recommended approval of CenturyTel of Idaho, Inc.’s Application which modifies its local exchange tariff to include intraLATA equal access and the introduction of an equal access recovery charge (EARC). In addition, Staff recommended that CenturyTel’s cost recovery method include an adjustment period at or near the end of the first year of recovery.
Commission Decision
Should the revision to Idaho Rural Exchange Carriers Tariff No. 2 approved?

Cheri C. Copsey

Staff: Doug Cooley

M:cent992_cc2.doc
Toll dialing parity, also referred to as “1 plus equal access” or carrier presubscription, allows a customer to pre-select a carrier for intrastate, intraLATA toll calls and then access his chosen carrier simply by dialing 1 plus the telephone number.

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