20010611Decision Memo.doc

DECISION MEMORANDUM

TO: COMMISSIONER KJELLANDER
COMMISSIONER SMITH
COMMISSIONER HANSEN
JEAN JEWELL
RON LAW
LYNN ANDERSON
LOU ANN WESTERFIELD
TONYA CLARK
DON HOWELL
RANDY LOBB
JOE CUSICK
DOUG COOLEY
GENE FADNESS
BEV BARKER
WORKING FILE

FROM: LISA NORDSTROM

DATE: JUNE 11, 2001

RE: IN THE MATTER OF THE APPLICATION OF TELERA COMMUNICATIONS CORPORATION, INC. FOR A CERTIFICATE OF PUBLIC CONVENIENCE AND NECESSITY TO PROVIDE LOCAL EXCHANGE TELECOMMUNICATIONS SERVICES. CASE NO. GNR-T-00-35

On October 18, 2000, Telera Communications, Inc. filed an Application for a Certificate of Public Convenience and Necessity to provide local exchange service within the State of Idaho. In the Notice of Application and Modified Procedure (Order No. 28728) issued on May 11, 2001, the Commission solicited comments regarding Telera’s Application. No comments were received other than those submitted by Commission Staff.
THE APPLICATION
Telera Communications is a Delaware corporation with headquarters in Campbell, California. It is a wholly owned subsidiary of Telera, Inc., a privately-held technology corporation that specializes in combining telecommunications with application software to allow customers access to the Internet or e-mail from any telephone. Telera Communications obtained a Certificate of Authority from Idaho's Secretary of State on July 21, 2000. Although it does not maintain an office in Idaho, Telera does have a registered in-state agent.
Telera’s Application requests authorization to provide resold local exchange services throughout the State of Idaho within the service areas currently served by incumbent local exchange carriers (ILECs). However, Telera does not intend to operate in ILEC service areas that are eligible for a small or rural carrier exemption pursuant to Section 251 of the federal Telecommunications Act of 1996. Its Application and sample tariff state Telera’s intention to provide specific forms of intrastate local exchange services and interexchange services targeted primarily to business customers.
Telera indicates that it will initially provide service through resale agreements with Qwest and Verizon. If market conditions allow, Telera may build its own facilities. Some of the resale services Telera intends to provide are: local dial tone for businesses at flat rates, 1+ outbound long distance service, calling cards, directory assistance, high-speed data services, and feature services such as call forwarding and Caller ID. Finally, Telera contends that it has the necessary technical and financial ability to provide service in Idaho and has stated its intent to comply with Idaho Rules and Laws.
STAFF COMMENTS
Based on its review of Telera’s Application, Staff found that the Company's filing satisfied all the requirements of the Commission’s Rules and Procedural Order No. 26665. Staff noted that although the Company intends to operate in the same Idaho areas as Qwest and Verizon, Telera has not yet obtained any interconnection agreements in Idaho. However, Staff believes the Company understands and agrees to comply with the Commission’s Rules and requirements.
Although the Company does not propose to require advanced deposits from its customers, Staff recommends that the Company post a $25,000 bond payable to the Idaho Public Utilities Commission. Based on the financial information presented, an estimated number of potential customers, and its lack of operating history in Idaho, Staff believes this bond will help protect customers until Telera establishes a service track record. Staff also recommends that this bond remain on file for Telera's first year of service in Idaho.
In sum, Staff recommends approval of the Application for a Certificate of Public Convenience and Necessity contingent upon the Company's posting of a $25,000 bond.
COMMISSION DECISION
1. Should Telera’s Application for a Certificate of Public Convenience and Necessity be approved?
2. If so, should Telera be required to post a $25,000 bond?

Lisa Nordstrom

Staff: Doug Cooley

M:GNRT0035_ln

DECISION MEMORANDUM 1