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Home My WebLink About29089_mod.docBEFORE THE IDAHO PUBLIC UTILITIES COMMISSION IN THE MATTER OF THE APPLICATION OF CENTURYTEL OF THE GEM STATE, INC. AND CENTURYTEL OF IDAHO, INC. FOR APPROVAL OF A TARIFF ADVICE CONTAINING DEPOSIT REQUIREMENTS BY INCUMBENT LOCAL EXCHANGE CARRIERS FOR INTEREXCHANGE CARRIERS. ) ) ) ) ) ) ) ) CASE NO. GNR-T-02-11 NOTICE OF APPLICATION NOTICE OF MODIFIED PROCEDURE ORDER NO. 29089 On July 12, 2002, CenturyTel of the Gem State, Inc. and CenturyTel of Idaho (“CenturyTel”) filed identical tariff advices proposing to change deposit regulations related to conditions under which it may request security deposits from Interexchange Carriers (“IXCs”). The Company states that given the current financial environment, particularly in the telecommunications industry, the Company is facing greater risks for uncollectibles due to payment defaults. Accordingly, CenturyTel contends the revisions are necessary to ensure that adequate security is held as a guarantee of payment. After reviewing the tariff advices we find that they raise important policy issues that all local exchange carriers (“LECs”) and IXCs operating in Idaho should have the opportunity to file comments on. Accordingly, we shall suspend the effective date of these tariff advices. We shall also treat these advices as applications and process them by Modified Procedure under the Commission’s Rules of Procedure. See IDAPA 31.01.01.134.02 and .201-.204. Furthermore, we make the following Conclusions of Law. CONCLUSIONS OF LAW The Idaho Public Utilities Commission has jurisdiction over this matter by virtue of Idaho Code, Title 61. Pursuant to Idaho Code § 61-622, the Commission has the authority to suspend CenturyTel’s proposed tariff advices for a period of thirty (30) days plus two (2) months from the date of this Order. Pursuant to Commission Rule of Procedure 134.02 the Commission shall treat these tariff advices as an application. NOTICE OF APPLICATION YOU ARE HEREBY NOTIFIED that CenturyTel of the Gem State and CenturyTel of Idaho have filed identical tariffs proposing changes in their Access Services Tarrifs concerning deposit requirements for IXCs. YOU ARE FURTHER NOTIFIED that the proposed tariffs require that an IXC provide additional security deposits to CenturyTel at any time following the installation of service when: 1) the IXC has established a history of late payments to the ILEC; 2) the customer’s gross monthly billing has increased beyond the amount initially used to estimate a security deposit; or 3) the carrier’s credit worthiness has fallen below commercially acceptable levels as determined by an independent credit rating or reporting service. YOU ARE FURTHER NOTIFIED that CenturyTel states that the security deposit will not exceed an amount equal to the total rates and charges for two months of the IXC’s actual billing for services. The Company states that if an existing customer fails to remit a deposit required under this tariff, services to that customer may be discontinued in accordance with the terms specified in CenturyTel’s tariff. NOTICE OF MODIFIED PROCEDURE YOU ARE FURTHER NOTIFIED that the Commission has determined that the public interest may not require a formal hearing in this matter and will proceed under Modified Procedure pursuant to Rules 201 through 204 of the Idaho Public Utilities Commission's Rules of Procedure, IDAPA 31.01.01.201 through .204. YOU ARE FURTHER NOTIFIED that the Commission may not hold a hearing in this proceeding unless it receives written protests or comments opposing the use of Modified Procedure and stating why Modified Procedure should not be used. Reference IDAPA 31.01.01.203. YOU ARE FURTHER NOTIFIED that any person desiring to state a position on this Application may file a written comment in support or opposition with the Commission on or before August 22, 2002. The comment must contain a statement of reasons supporting the comment. Persons desiring a hearing must specifically request a hearing in their written comments. Written comments concerning this Application shall be mailed to the Commission and the Applicant at the addresses reflected below: Commission Secretary Idaho Public Utilities Commission PO Box 83720 Boise, ID 83720-0074 Street Address for Express Mail: 472 W. Washington Street Boise, ID 83702-5983 Pamela Donovan CenturyTel of the Gem State, Inc. 805 Broadway PO Box 9901 Vancouver, WA 98668-8701 These comments should contain the case caption and case number shown on the first page of this document. Persons desiring to submit comments via e-mail may do so by accessing the Commission's homepage located at www.puc.state.id.us under the "Comments and Questions" icon. Once at the "Comments and Questions" icon, fill in the case number as it appears on the front of this document, and enter your comments. YOU ARE FURTHER NOTIFIED that the Commission requests that the parties submitting written comments focus on two aspects of this issue: the first being the general policy question of whether or not the requirement of a deposit is good public policy, and secondly, if the Commission decides that this is good public policy, what are the implementation issues associated with it. In regard to these matters the Commission has assembled the following list of questions that it desires to receive comments on: 1) What is the level of risk that LECs are exposed to absent the requested deposit policy and how can this risk be quantified? 2) Would it be proper to have state requirements regarding these proposed security deposits that track those that may be endorsed by the FCC? 3) If an IXC is providing both intrastate as well as interstate interexchange services, would having a state standard and an FCC standard be problematic? 4) Should small LECs be treated the same as large LECs concerning usage of the terms of this proposed tariff? Commission experience has shown that access revenues represent a larger portion of overall revenues for small LECs than for large LECs. With that in mind, are small LECs at greater risk than large LECs, thereby justifying different treatment? 5) Does the current WorldCom bankruptcy filing demonstrate the need for this policy or the futility of implementing it? 6) Is it appropriate to require a deposit from an IXC that has no history of late payments regardless of its credit rating? 7) Would this requirement become a self-fulfilling prophecy if a financially struggling company were required to pay a two-month deposit? 8) If the Commission were to find that the proposed deposit policy was in the public interest, what is the proper trigger for determining credit worthiness? 9) Under the second proposed condition in the tariff, where a carrier’s billing increases beyond the amount initially used to estimate a deposit, what size increase will trigger a deposit? How big of an increase should trigger a deposit? Also, over what period will this increase be determined: should it be a one-month increase or a longer term, such as a three-month average? 10) If a required deposit is not paid, how will disconnection be accomplished? How will end users be transitioned to a new provider and how will that provider be determined? Should customers be polled to see what their preferences are or should they be allocated based on the current distribution of carriers? What will be done to ensure that the transition is done in accordance with the Commission’s Customer Relations Rules? 11) Are there possible alternatives to requiring a deposit from IXCs? Is a surety bond a reasonable alternative? While the Commission believes that these questions provide an excellent basis for discussion, it does not consider them to be exhaustive. The Commission therefore encourages parties to feel free to address other areas of concern regarding these proposed tariffs. YOU ARE FURTHER NOTIFIED that if no written comments or protests are received within the deadline, the Commission will consider the matter on its merits and enter its Order without a formal hearing. If comments or protests are filed within the deadline, the Commission will consider them and in its discretion may set the matter for hearing or may decide the matter and issue its Order on the basis of the written positions before it. Reference IDAPA 31.01.01.204. YOU ARE FURTHER NOTIFIED that the deadline for the Applicants to file written reply comments with respect to their Application in this case is August 29, 2002. YOU ARE FURTHER NOTIFIED that the Application has been filed with the Commission and is available for public inspection during regular business hours at the Commission offices. YOU ARE FURTHER NOTIFIED that all proceedings in this case will be held pursuant to the Commission's jurisdiction under Title 61 of the Idaho Code and that the Commission may enter any final Order consistent with its authority under Title 61. YOU ARE FURTHER NOTIFIED that all proceedings in this matter will be conducted pursuant to the Commission's Rules of Procedure, IDAPA 31.01.01.000 et seq. O R D E R IT IS HEREBY ORDERED that the proposed tariff advices are suspended for a period of thirty (30) days plus two (2) months from the date of this Order, or until such time as the Commission may issue an Order accepting, rejecting or modifying them. IT IS FURTHER ORDERED that these tariff advices shall be treated as applications and be processed under our rules of Modified Procedure. IPAPA 31.01.01.201-204. IT IS FURTHER ORDERED that the Commission does hereby solicit written comment on this Application from the public, Applicant and Commission Staff in accordance with the foregoing schedule. DONE by Order of the Idaho Public Utilities Commission at Boise, Idaho, this day of August 2002. PAUL KJELLANDER, PRESIDENT MARSHA H. SMITH, COMMISSIONER DENNIS S. HANSEN, COMMISSIONER ATTEST: Jean D. Jewell Commission Secretary O:GNRT0211_jh NOTICE OF APPLICATION NOTICE OF MODIFIED PROCEDURE ORDER NO. 29089 -1- Office of the Secretary Service Date August 7, 2002