29056.doc

BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION

IN THE MATTER OF AN INCREASE TO THE SURCHARGE FOR THE IDAHO TELECOMMUNICATIONs SERVICE ASSISTANCE PROGRAM. )
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CASE NO. GNR-T-02-10

ORDER NO.  29056

In 1998 the Idaho Legislature amended the Idaho Telecommunications Service Assistance Program (ITSAP) statutes, codified at Idaho Code, Title 56, Chapter 9. Funds raised through the ITSAP surcharge are used to help defray the cost of residential basic local exchange telephone service for eligible customers. The program, which is administered by the Department of Health and Welfare, works in conjunction with federal programs to “maximize federal ‘lifeline’ and ‘linkup’ contributions to Idaho’s low-income customers.” Idaho Code § 56-901(1).
Following the changes made to the ITSAP legislation, the Commission issued Order No. 27608 to implement the changes and to establish the surcharge level, which was set at $0.13 per line per month on all end user business, residential and wireless access services. At that rate the ITSAP account developed a substantial surplus and in May 1999, the Commission reduced the surcharge from $0.13 per access line to $0.05 per access line per month. The Commission intended to eliminate the ITSAP surplus over time, recognizing that in the future it may be necessary to increase the surcharge.
The Commission did not issue an order during 2000 to change the ITSAP surcharge level. In December 2001, however, it became necessary to increase the surcharge level to $0.08 per line per month. The Administrator’s report for the fiscal year ending September 30, 2001, projected that the ITSAP fund balance, at the existing surcharge level, would show a negative balance of $269,916 by September 30, 2002. The fund Administrator recommended the surcharge level be increased from $0.05 to $0.08 per line per month. The Commission subsequently issued Order No. 28914 to increase the level to the amount recommended by the fund Administrator, effective February 1, 2002.
The quarterly report submitted by the fund Administrator for the quarter ending March 31, 2002, shows the ITSAP fund balance continuing to decline. The cash balance in the fund at March 31, 2002, was $7,780, and the net revenue for the quarter was -$155,705. The fund Administrator recommended the surcharge be increased to $0.10 per line per month effective July 1, 2002, and at that level, projects a balance in the fund of $203,000 by March 31, 2003. Staff reviewed the quarterly report filed by the fund Administrator and also recommends the surcharge level be raised to $0.10 per line per month. Staff noted that the amount of ITSAP funds needed is difficult to predict for several reasons, including the growth in the number of low-income households that are eligible to receive the ITSAP credit.
Based on the ITSAP Administrator’s report, the Commission accepts the recommendation to increase the ITSAP surcharge from $0.08 per access line per month to $0.10 per access line per month. The fund Administrator’s report shows the fund balance continuing to decline sharply, and unless the surcharge level is increased, there will be insufficient funds to meet the funding requirements for all eligible households. It is necessary that the surcharge be at a level that is sufficient to retain a reasonable balance in the ITSAP fund to ensure its stability and availability to eligible customers.
O R D E R
IT IS HEREBY ORDERED that the ITSAP surcharge is increased from $0.08 to $0.10 per access line per month on all end user business, residential and wireless access services. The new ITSAP surcharge amount of $0.10 per access line shall be effective July 1, 2002.
THIS IS A FINAL ORDER. Any person interested in this Order (or in issues finally decided by this Order) or in interlocutory Orders previously issued in this Case No. GNRT0210 may petition for reconsideration within twenty-one (21) days of the service date of this order with regard to any matter decided in this Order or in interlocutory Orders previously issued in this Case No. GNRT0210. Within seven (7) days after any person has petitioned for reconsideration, any other person may cross-petition for reconsideration. See Idaho Code § 61-626.

DONE by Order of the Idaho Public Utilities Commission at Boise, Idaho this
day of June 2002.

PAUL KJELLANDER, PRESIDENT

MARSHA H. SMITH, COMMISSIONER

DENNIS S. HANSEN, COMMISSIONER

ATTEST:

Jean D. Jewell
Commission Secretary

vld/O:GNRT0210_ws

ORDER NO. 29056 1

Office of the Secretary
Service Date
June 25, 2002