20020821ASCENT Comments.pdf

Jean Jewell OA/A 602 -//
From:Ed HowellSentLVednesday,August21,20021:31PMTo:Jean Jewell;Ed Howell;Gene Fadness;Tonya ClarkSubject:Comment acknowledgement
WWW Form Submission:
Wednesday,August 21,200212:30:40 PM
Case:GNR-T-02-11Name:Walter BlackwellStreetAddress:1401 K Street NW,Suite 600City:ÑashingtonState:D.C.
ZIP:20005Home_Telephone:[phone]E-Mail:[e-mail]:CenturyTelmailinglistyesno:noCommentdescription:~¯
August 21,2002
Ms.Myrna J.Walters,SecretaryIdahoPublicUtilitiesCommissionP.O.Box 83720
Boise,Idaho 83720-0074
RE:Century Tel CLEC Security Deposit Obligations,Case No.GNR-T-02-ll,Order No.29089
Dear Ms.Walters:
Pursuant to the Idaho Public Utilities Commission's August 7,2002 Notice of ApplicationandNoticeofModifiedProcedure(Order No.29089),in the above-referenced docket,theAssociationofCommunicationsEnterprises("ASCENT")writes to urge you to rejectCenturyTeloftheGemState,Inc.and CenturyTel of Idaho ("CenturyTel")recent tarifffilings,an attempt to impose unilateral,arbitrary,and capricious deposit requirementsonIdahointerexchangecarriers(IXCs)to the detriment of the competitive industry and,ultimately,to Idaho consumers.
CenturyTel's tariff filings propose amendments that would enable CenturyTel to collectsecuritydepositswhenCenturyTeldeterminesthecustomer's,including an existingcustomer's,"credit worthiness"has fallen below commercially acceptable levels,when acustomer's gross monthly billing exceeds the amount initially used to determine a securitydeposit,or when an account is allegedly in arrears.Deceptively positioned as necessarytoprotectitsfinancialinterests,CenturyTel seeks to unilaterally impose,or raise,significant deposit obligations the instant there is any indication of a competitor'schangeinfinancialconditionunderawhollysubjectivestandard.CenturyTel's proposeddepositobligationsincludepotentialserviceterminationforfailuretocomply,and offertheIXCnoapparentrecoursetochallengetheimpositionofadeposit.Competitors,whorelyonthedominantcarrier's services and networks,and their subscribers,now face aloadedgunthatissettogooffattheslightestperceivedprovocation.Given currenteconomicconditions,this imposes a significant burden on competition.
As proposed,CenturyTel's deposit obligations need not be based on actual credit andpaymenthistory.CenturyTel could,under the proposed tariff conditions,impose depositrequirementdespiteacustomer's good payment history with CenturyTel.CenturyTel couldinsteadrelyonambiguouscriteria,such as whether a credit report demonstratedcommerciallyunacceptablecredit,to determine a customer's creditworthiness and depositobligations.CenturyTel also seeks to be free to collect new deposits when a customer's
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àccount is allegedly in a cars,without regard to disputeo cilling amounts.Given thetriggerschosenbyCenturyTel,almost every carrier doing business with CenturyTel will besubjecttodepositrequirements.In light of current market conditions,CenturyTel'sunilateralimpositionofunjusttermsonanunreasonablyshortnotice,apparently on anyservice,threatens competitors'operations and financial standing.
These deposit and advanced payment obligations are not confined to Century Tel.On August16,2002,the FCC suspended a similar SBC Communications,Inc.filing,finding that"substantial questions regarding the lawfulness of SBC's tariff revisions...require furtherinvestigation."A copy of the FCC's tariff suspension Order is attached.This newattempttoexercisemarketdominanceonceagaindemonstratestheincumbents'overwhelmingpowerovercompetitorsandactstofurthercripplecompetition.Ironically,in light oftheincumbents'proclivity to seek regulatory flexibility in order to "compete,"theincumbentscontinueturningtotheregulatoryenvironmenttoseekfinancialprotection toremovethemfromanyrisk.
CenturyTel's proposed deposit obligations are overly broad,unjustified,and unreasonable.They stand to impose significant and unwarranted financial burdens on competitors,and inparticularonthesmallercompanieswhorepresentthecoreofASCENTmembers.TheseobligationsfurtherstandtoprovideCenturyTelwithafinancialwindfallatcompetitors'expense.This Commission should not allow CenturyTel to pursue such deposit requirementsthroughtheuseofabroad,ambiguous,and heavy handed approach.
Sincerely,
ASSOCIATION OF COMMUNICATIONSENTERPRISES
Walter G.Blackwell
Walter G.Blackwell
President
Attachment
Federal Communications Commission DA 02-2039BeforetheFederalCommunicationsCommissionWashington,D.C.20554
In the matter of
Ameritech Operating Companies Tariff FCC No.2NevadaBellTelephoneCompaniesTariffFCCNo.1PacificBellTelephoneCompanyFCCTariffNo.1SouthernNewEnglandTelephoneCompaniesTariff FCC No.39SouthwesternBellTelephoneCompanyFCCTariffNo.73
Transmittal No.1312TransmittalNo.20
Transmittal No.77
Transmittal No.772
Transmittal No.2906
ORDERAdopted:August 16,2002 Released:August 16,2002
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By the Division Chief,Pricing Policy Division:
I.INTRODUCTION
1.Pursuant to section 204 (a)(3)of the Communications Act of 1934,asamended,1 the Ameritech Operating Companies (Ameritech),the Nevada BellTelephoneCompanies
(Nevada Bell),the Pacific Bell Telephone Company (Pacific Bell),the SouthernNewEnglandTelephoneCompanies(SNET),and the Southwestern Bell TelephoneCompany(SWBT)filed
Transmittal Nos.1312,20,77,772,and 2906,respectively,revising certainprovisionsoftheirinterstateaccesstariffs,FCC.Nos.2,1,1,39,and 73,respectively,to become effective August17,2002.2 Because these telephone companies are all part of SBCCommunications,Inc.,they will be referred to collectively throughout thisorderas"SBC."SBC's tariff revisions wouldamendthesectionsofitstariffsregarding security deposits to allow SBC torequiresecuritydepositsincircumstancesnotcoveredbyitsexistingtariffs.The revisions also would addprovisionsregardingadvance payment for services.2.SBC's current tariffs allow it to require security deposits from acustomerthathasalatepaymenthistoryorlacksestablishedcredit.TherevisionspermitSBCtorequirea
two-month deposit or prepayment if a customer has a late payment history ornoestablished
1 47 U.S.C.§204(a)(3).
2 Ameritech Operating Companies,Nevada Bell Telephone Company,Pacific BellTelephoneCompany,Southern
New England Telephone Companies,and Southwestern Bell Telephone Company,Transmittal Nos.1312,20,77,772,and 2906,respectively,Tariffs FCC.Nos.2,1,1,39,and 73,respectively,(filed August 2,2002).
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Federal Communications Commission DA 02-2039
2credit,and the customer has "impaired credit worthiness.""Impaired creditworthiness"is defined as meeting one of the following criteria:(1)thecustomer's or its parent's senior debt
securities are below investment grade as defined by the Securities andExchangeCommission;(2)the customer's or its parent's senior debt securities
are rated the lowest investment graderatingcategorybyanationallyrecognized statistical rating organization and
are put on review by the rating organization for a possible downgrade;(3)ifthecustomerdoesnothavesecuritiesratedbycreditratingagencies,the customer is rated "fair"or below in acompositecreditappraisalaspublishedbyDunandBradstreet,or received a"high risk"Paydex score aspublishedbyDunandBradstreet;(4)the customer or its parent informs SBC
or publicly states that it is unable to pay its debts;or (5)the customer
or its parent is in voluntary or involuntarybankruptcy.SBC would require deposits or prepayments from customers withimpairedcreditworthinessonlyiftheirmostrecentinterstateaccessbillstotal$1 million or more.3 The tariff
revisions also provide that customers who have "impaired credit worthiness"but
no history of late payment or lack of established credit have a choice ofpayingaone-month security deposit
or prepaying for one month of service.4 Such customers also must pay theirbillsin21daysratherthan30days.
3.SBC's revisions also provide that,if a customer subject to a two-monthdepositrequirementfailstopayitsbillsontime,SBC would shorten from 30daysto15daysthenoticeperiodforittorefusetoprocessneworders,including Primary InterexchangeCarrier(PIC)orders from end users,or to discontinue service.If a customersubjecttoaone-month depositrequirementfailstopayitsbills on time,this notice period would beshortenedto10days.5 Similarly,if a customer fails to pay a requireddepositwithin21days,SBC could refuse toprocessordersorterminateserviceaftera 10-day notice period.6 Last,the revisions would allow SBC to refuse to process new orders or to terminateserviceaftera15-day notice period if acustomerfailstomakerequiredpaymentsto the Universal Service Fund.74.As justification for these revisions,SBC states that it has participatedin53bankruptciesinthepasttwoyears.8 SBC estimates that WorldCom owesitmorethan$300
million,"most of which ...could be lost in bankruptcy proceedings."95.On August 9,2002,AT&T Corp.(AT&T);WorldCom,Inc.(WorldCom);andcounselfortheAssociationforLocalTelecommunicationsServices(ALTS),theCompetitive
Telecommunications Association (CompTel),Grande Communications Networks,Inc.,Ionex Telecommunications,Inc.,KMC Telecom Holdings,Inc.,NuVox,Inc.,SageTelecom,Inc.,Talk America,Inc.,and XO Communications,Inc.;and counsel for theAssociationofCommunicationsEnterprises(ASCENT),ATX Communications,Inc.,Focal Communication
3 See,e.g.,Southwestern Bell Telephone Company Tariff FCC No.73,Transmittal No.2906,Original Pages 2-55.2and2-55.3.4See,e.g.,d.,Original Page 2-55.3.5See,e.g.,id.,6 th Revised Page 2-20 and 2-21.6See,e.g.,id.,Original Page 2-55.4 7See,e.g.,id.,1 st Revised Page 2-22.8
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See,e.g,id.,Desc tion and Justification at ,9See,e.g.,id.at 7-8.
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Federal Communications Commission DA 02-2039
3Corp.,Level 3 Communications,LLC,Pac-West Telecomm,Inc.,US LEC Corp.,and U.S.TelePacific Corp.filed petitions to reject,or,in the alternative,to suspend and investigate all theSBCtariffs.10 Sprint Corporation (Sprint)filed a petition to reject,or,in the alternative,to suspend and investigate the Ameritech,Pacific Bell,SNET and SWBT tariffs.11 MPowerCommunicationsCorp.(MPower)filed a petition to reject,or,in thealternative,to suspend and investigate the Ameritech,Pacific Bell,and SWBTtariffs.12 Nextel Communications,Inc.(Nextel)filed a petition to reject,or,in the alternative,to suspend andinvestigatetheSWBTtariff.13 On August 16,2002,SBC filed its reply.14SBCfileditsreplyonedaylaterthanrequiredbyourrules,15 and,therefore,filed a motion to accept its late-filed reply.16 In this Order we grant the petitions of AT&T,WorldCom,ALTS,Sprint,MPower and Nextel so far as theyaskustosuspendandinvestigateSBC's tariffs,and we suspend for fivemonthsandsetforinvestigationSBC's revisions to its interstate accessTariffsFCCNos.2,1,1,39,and 73.WealsograntSBC's motion to accept its late-filed reply,because,as we aresuspendingSBC's tariffs,no party is prejudiced by our grant of this motion.
II.DISCUSSION
6.We find that petitioners raise substantial questions regarding thelawfulnessofSBC's tariff revisions that require further investigation.Theyquestionwhethertherevisions
violate a Commission prescription,are unjust,unreasonable,and discriminatoryinviolationof
10 Ameritech Operating Companies,Nevada Bell Telephone Company,Pacific BellTelephoneCompany,Southern
New England Telephone Companies,and Southwestern Bell Telephone Company,Transmittal Nos.1312,20,77,772,and 2906,respectively,Tariffs FCC Nos.2,1,1,39,and 73,respectively,Petition of AT&T Corp.(Aug.9,
2002)(AT&T Petition);WorldCom Petition to Reject or,in the Alternative,Suspend and Investigate (Aug.9,2002)(WorldCom Petition);Petition to Rejector,Alternatively,to Suspend and Investigate of ALTS,CompTel,GrandeCommunicationsNetworks,Inc.,Ionex Telecommunications,Inc.,KMC TelecomHoldings,Inc.,NuVox,Inc.,Sage Telecom,Inc.,Talk America,Inc.,and XOCommunications,Inc.(Aug.9,2002)(ALTS Joint Petition);Petition to Reject or Suspend And Investigate Proposed Tariff Revisions ofASCENT,ATX Communications,Inc.,Focal Communications Corp.,Level 3Communications,LLC,Pac-West Telecomm,Inc.,US LEC Corp.,and U.S.Telepacific Corp.(ASCENT Joint Petition).11AmeritechOperatingCompanies,Pacific Bell Telephone Company,Southern NewEnglandTelephoneCompanies,and Southwestern Bell Telephone Company,TransmittalNos.1312,77,772,and 2906,respectively,
Tariffs FCC Nos.2,1,39,and 73,respectively,Petition of Sprint toRejectorAlternativelySuspendandInvestigate(Aug.9,2002)(SprintPetition).
12 Ameritech Operating Companies,Pacific Bell Telephone Company,andSouthwesternBellTelephoneCompany,Transmittal Nos.1312,77,and 2906,respectively,Tariffs FCC Nos.2,1,and73,respectively,Petitions of MPower Communications Corp.to Reject orAlternativelySuspendandInvestigate(Aug.9,2002)(MPower Petitions).
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13 Southwestern Bell sephone Company,Transmittal J.2906,Tariff FCC No.73,Petition of NextelCommunications,Inc.to Reject or Alternatively Suspend and Investigate (Aug.9.2002)(Nextel Petition).14AmeritechOperatingCompanies,Nevada Bell Telephone Company,Pacific BellTelephoneCompany,Southern New England Telephone Companies,and SouthwesternBellTelephoneCompany,Transmittal Nos.1312,20,77,
772,and 2906,respectively,Tariffs FCC Nos.2,1,1,39,and 73,respectively,SBC Opposition to Petition to Reject or,in the Alternative,Suspend and Investigate (Aug.16,2002).
15 47 C.F.R.§1.773(b).16 Ameritech Operating Companies,Nevada Bell Telephone Company,Pacific BellTelephoneCompany,Southern
New England Telephone Companies,and Southwestern Bell Telephone Company,Transmittal Nos.1312,20,77,772,and 2906,respectively,Tariffs FCC Nos.2,1,1,39,and 73,respectively,SBC Motion for Acceptance of Late-Filed
Reply (Aug.16,2002).
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Federal Communications Commission DA 02-2039
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sections 201(b)and 202(a)of the Act,and whether the language of therevisionsisvagueandambiguousinviolationofsections61.2 and 61.54 oftheCommission's rules.17 PetitionersfurtherquestionwhetherSBChas demonstrated substantial cause for a materialchangebyadominantcarrierinaprovisionofatermplan.18 Finally,certain petitioners claim that SBC'srevisionsconflictwithprovisions of the bankruptcy code.19 For thesereasons,we conclude that substantial questions regarding the lawfulness ofSBC's FCC Tariffs Nos.2,1,1,39 and 73,Transmittal Nos.1312,20,77,772,and 2906,respectively,require furtherinvestigation,and we suspend them for five months.The specific issues thatwillbethesubjectoftheinvestigationwillbeidentifiedinanupcomingdesignationorderandmayinclude,but notbelimitedto,the issues identified in this paragraph.We may also,byorder,identify discrete issues that do notwarrantfurtherinvestigation.III.EX PARTE REQUIREMENTS
7.This investigation is a permit-but-disclose proceeding and is subject totherequirementsofsection1.1206(b)of the Commission's rules,47 C.F.R.
§1.1206(b),as revised.
Persons making oral ex parte presentations are reminded that memorandasummarizingthepresentationsmustcontainasummaryofthesubstance of thepresentationandnotmerelyalistingofthesubjectsdiscussed.More than a one-or two-sentencedescriptionoftheviewsandargumentspresentedisgenerallyrequired.20Otherrulespertainingtooralandwrittenpresentationsarealsosetforthinsection1.1206(b).IV.ORDERING CLAUSES8.ACCORDINGLY,IT IS ORDERED that,pursuant to section 204(a)of theCommunicationsActof1934,as amended,47 U.S.C.§204(a),and throughtheauthority
delegated pursuant to sections 0.91 and 0.291 of the Commission's rules,47C.F.R.§§0.91 and 0.291,Transmittal Nos.1312,20,77,772,and 2906,respectively,Tariffs FCC Nos.2,1,1,39,and 73 of the Ameritech Operating Companies,the Nevada Bell TelephoneCompany,the Pacific Bell Telephone Company,the Southern New England TelephoneCompanies,and the
Southwestern Bell Telephone Company ARE SUSPENDED for five months and aninvestigationISINSTITUTED.
9.IT IS FURTHER ORDERED that the Ameritech Operating Companies,the NevadaBellTelephoneCompany,the Pacific Bell Telephone Company,the Southern NewEnglandTelephoneCompanies,and the Southwestern Bell Telephone Company SHALLFILEasupplementwithinfivebusinessdaysfromthereleasedateofthisorderreflectingthesuspension.They should cite the "DA"number on the instant order as theauthorityforthefiling.
10.IT IS FURTHER ORDERED that the Motion for Acceptance of Late-FiledReplyfiledbySBCCommunications,Inc.IS GRANTED.
17 47 U.S.C.§201(b),47 C.F.R.§§61.2,61.54.See,e.g.,AT&T Petition at 11-16;.Nextel Petition at 4-7;MPowerPetitionsat1-6.18See,e.g.,ALTS Joint Petition at 16-17;Sprint Petition at 6-7.19See,e.g.,WorldCom Petition at 8-9;ALTS Joint Petition at 10.20See47C.F.R.§1.1206(b)(2),as revised.
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Federal Communications Commission DA 02-2039
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11.IT IS FURTHER ORDERED that the petitions to reject,or,in thealternative,to suspend and investigate filed by AT&T Corp.;WorldCom,Inc.;counsel for the Association forLocalTelecommunicationsServices,the Competitive Telecommunications Association,Grande Communications Networks,Inc.,Ionex Telecommunications,Inc.,KMC TelecomHoldings,
Inc.,NuVox,Inc.,Sage Telecom,Inc.,Talk America,Inc.,and XOCommunications,Inc.;Sprint Corporation;MPower Communications Corporation;andNextelCommunications,Inc.;and theAssociationofCommunicationsEnterprises,ATX Communications,Inc.,FocalCommunicationCorp.,Level 3 Communications,LLC,Pac-West Telecomm,Inc.,USLECCorp.,and U.S.TelePacific Corp.,ARE GRANTED to the extent indicated herein and otherwiseAREDENIED.
FEDERAL COMMUNICATIONS COMMISSIONTamaraL.Preiss Division Chief,Pricing Policy DivisionWirelineCompetitionBureau
Transaction ID:8211230.40Referredby:http://www.puc.state.id.us/scripts/polyform.dll/ipucUserAddress:216.58.210.210UserHostname:216.58.210.210
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