20000519Comments.doc

DONALD L. HOWELL, II
DEPUTY ATTORNEY GENERAL
IDAHO PUBLIC UTILITIES COMMISSION
PO BOX 83720
BOISE, IDAHO 83720-0074
[phone]
IDAHO BAR NO. 3366

Street Address for Express Mail:
472 W WASHINGTON
BOISE ID 83702-5983

Attorney for the Commission Staff

BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION

IN THE MATTER OF THE APPLICATION OF CONVERGENT COMMUNICATIONS SERVICES, INC. FOR A CERTIFICATE OF PUBLIC CONVENIENCE AND NECESSITY.
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CASE NO. CVT-T-99-1

COMMENTS OF THE
COMMISSION STAFF

COMES NOW the Staff of the Idaho Public Utilities Commission, by and through its Attorney of record, Donald L. Howell, II, Deputy Attorney General, and in response to the Notice of Application and Notice of Modified Procedure issued in Order No. 28354 on April 28, 2000, submits the following comments.

BACKGROUND
On November 8, 1999, the Commission received an Application from Convergent Communications Services, Inc. (Convergent) for a Certificate of Public Convenience and Necessity (CPCN) to provide local exchange telecommunications services within the State of Idaho. Convergent’s Application stated that it desired to initially provide resold service, but may eventually use its own facilities, to serve both residential and business customers currently being served by U S WEST and GTE. The Application included a listing of a wide range of basic and advanced services that the Company indicated it intended to provide. The Company indicated it would be initiating negotiations for interconnection agreements.

STAFF FINDINGS
Staff has reviewed the information provided by Convergent in its Application and the additional material provided to support that Application, and believes it satisfies the requirements of the Commissions Rule of Procedure 111, IDAPA 31.01.01.111 and Procedural Order
No. 26665, issued November 7, 1996, which sets out the necessary information to be included with an application for a certificate.
Convergent, headquartered in Englewood and incorporated in Colorado, is a relatively new corporation, first capitalized in 1996. It is a wholly owned subsidiary of Convergent Communications, Inc., a publicly held corporation listed on the NASDAQ stock exchange. The Application indicated it was providing service in 16 cities around the nation in 1999, and expected to add an additional 34 cities to it nationwide network in 2000.
The Application included a prospectus for the Company which included financial data for 1997, 1998 and the first quarter of 1999. Although the Company had not yet reached profitability, it was experiencing significant increases in revenues. The Company recently announced it had arranged a financing package that provided an additional $175 million to fund its continued expansion, and it has not had difficulty in previous efforts to raise capital. Therefore, Staff believes the Company has access to sufficient capital resources to provide the proposed services.
The Company provided summaries of the resumes of the key management Staff that included numerous years of experience in the telecommunications industry. Staff is satisfied the Company has sufficient technical capability to provide the proposed services.
Convergent specifically indicated in its Application it will comply with all Commission rules. It has provided an illustrative tariff with its Application that demonstrates an understanding of tariffing requirements and processes.

STAFF RECOMMENDATION
Staff recommends a Certificate of Public Convenience and Necessity to provide competitive local exchange service in the service areas of U S WEST and GTE be provided to Convergent Communications Services, Inc.

DATED at Boise, Idaho, this day of May 2000.

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Donald L. Howell, II
Deputy Attorney General
Technical Staff: Wayne Hart

DH/WH/gdk/umisc/comments/cvtt991.wh

STAFF COMMENTS 1 MAY 19, 2000