20050620Final Order No 29806.pdf

Office of the Secretary
Service Date
June 20, 2005
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF THE INVESTIGATION
0 F INTRAST ATE PRESUBSCRIBED
INTEREXCHANGE CARRIER (LPIC) CHANGE CHARGES
CASE NO. GNR-05-
ORDER NO. 29806
On March 28, 2005 , the Commission issued a Notice of Investigation and Notice of
Modified Procedure, Order No. 29743, to investigate whether the intraLATA primary
interexchange carrier (LPIC) change charges established by the Commission should coincide
with the prescribed interexchange carrier (PIC) change charges established by the Federal
Communications Commission (FCC). Additionally, the Commission requested information
from Idaho ILECs on their capabilities and actual usage levels of electronic processing for
PIC/LPIC changes. Comments were filed by Qwest Corporation, Verizon Northwest Inc.
Citizens Telecommunications Co., CenturyTel, and Commission Staff. With this Order the
Commission implements a safe harbor pricing schedule for LPI C change charges that coincides
with the FCC's PIC change charges.
BACKGROUND
On March 15, 2005, the FCC issued a Report and Order (47 C.R. Chapter I, CC
Docket No. 02-, FCC 05-32) revising its PIC charge policies. On April 8 , 2005 , the FCC
extended its previously set deadline for the filing of revised federal tariffs for interstate PIC
change charges from April 14, 2005 to October 17, 2005 in response to petitions from many
local carriers expressing difficulties complying with the April 14 deadline. PIC change charges
are federally tariffed charges imposed by incumbent local exchange carriers (ILECs) on end-user
subscribers when these subscribers change their long distance carriers. The Report and Order
requires ILECs to create separate PIC change charges based on the method used to process the
request. Based on cost information submitted in the record of the proceeding, the Report and
Order adopts safe harbors below which PIC change charges will be considered reasonable.
These safe harbors are $1.25 for electronically processed PIC changes and $5.50 for manually
processed PIC changes. Additionally, ILECs must also revise their federal tariffs to reflect a rate
ORDER NO. 29806
that is equal to 50 percent of the full PIC change charge rate when a customer requests a PIC
change in conjunction with an LPIC change.
The FCC's previous safe harbor was set at $5.00. Under the safe harbor, companies
could tariff a charge of up to $5.00 without providing cost studies. If a carrier desired to tariff a
higher charge, it had to provide cost support to justify the higher amount. The FCC's new safe
harbor applies only to PIC changes for interstate long distance. IntraLA T A PIC (LPIC) change
charges are tariffed at the state level. Although the Commission has not formally established a
safe harbor rate for LPIC change charges, it has established a precedent of approving a rate that
is within the FCC's safe harbor of $5.00 without requiring the company to submit detailed cost
support. When the new rates for interstate PIC change charges become effective there will be a
lack of consistency between the charges for changing PICs and LPICs.
The Commission opened this docket to investigate whether the LPI C change charges
established by the Commission should coincide with the PIC change charges established by the
FCC. Additionally, the Commission requested information from Idaho ILECs on their
capabilities and actual usage levels of electronic processing for PIC/LPIC changes.
SUMMARY OF COMMENTS/RECOMMENDA TIONS
Qwest recommended and requested that the Commission refrain from requiring any
changes to intrastate tariffs until the FCC grants or denies Qwest's pending Petition for
Reconsideration regarding the 50% rule from the FCC Order. Additionally, Qwest requested
that, in the event the Commission orders changes, it also grant the affected LECs a reasonable
period of time to implement any changes to their billing and other internal systems that may be
required.
Verizon stated that it had no objection to the Commission mirroring the FCC's PIC
change charge Order, but requested that the Commission make a decision as soon as possible as
it is currently modifying its systems to implement the new FCC rates by October 1. Verizon also
requested that if the Commission decides to mirror the FCC safe harbor rates, that it be allowed
to modify its state access tariff to refer to the rates in the FCC Tariff No. 14.
Frontier stated that action by the Commission to mirror federal PIC change charges
with the LPIC change charge is unnecessary and should not be implemented.
CenturyTel simply provided information regarding actual usage levels of electronic
processing for PIC/LPIC changes.
ORDER NO. 29806
Staff recommended that the Commission adopt as a safe harbor the same pricing
structure for LPIC change charges as adopted by the FCC for interstate PIC change charges , and
require that all incumbent local exchange carriers file changes to LPIC charges in the appropriate
Idaho tariffs to become effective at the same time as changes to interstate PIC charges that are
filed at the federal level.
FINDINGS
We find a safe harbor pricing structure for LPI C change charges that is consistent
with, and mirrors, the FCC's safe harbors for PIC change charges to be reasonable and prudent.
The FCC's Order was based upon cost information submitted in the record of its proceeding.
We have not been presented with any information that would be contradictory to establishing the
same price levels as a safe harbor for LPIC change charges. Requiring detailed cost submissions
of each carrier to individually set each LPIC change charge would be unduly burdensome for
both the companies and the Commission. Thus, we find that adoption of a safe harbor approach
where carriers may tariff LPIC change charges that are equal to or less than the safe harbor rate
without detailed cost studies, to be reasonable. However we note that although we are
establishing safe harbor pricing levels for LPIC changes, carriers still have the option to submit
cost studies showing their costs exceed the safe harbor limits and to request higher rates.
Although we understand that Qwest has petitioned the FCC for reconsideration of
that portion of its Order that deals with the authorized 50% charge when a customer requests a
change to the PIC as well as the LPIC, we are not inclined in this instance to wait for additional
Orders or statements from the FCC. It is important for companies in our jurisdiction to have
advance notice of our decision in order to revise their state tariffs and make any other changes or
adjustments that may be required to implement the new LPIC change charges. Additionally, the
FCC found that when a PIC change and an LPIC change are submitted simultaneously, only a
single charge is allowed. Thus, it required the tariffs to include a rate that is 50% of the regular
charge in these instances. In order for the company to recover the remaining 500/0 of its cost, it is
necessary, as anticipated by the FCC's Order, to recover that amount from the state jurisdiction
through the state tariffs.
Although we recognize Staffs suggestion that special customer notification and/or
education may be necessary because the way a customer requests changes may effect the charges
that result, we are not ordering any special customer notification or education. A special notice
ORDER NO. 29806
regarding LPIC and PIC change charges, and how the request to change either, or both, effects
the charge to be imposed, would likely result in more confusion than clarity for customers.
ORDER
IT IS HEREBY ORDERED that the intrastate/intraLATA primary interexchange
carrier (LPIC) change charge shall coincide with the FCC's PIC change charge safe harbor
pricing structure. LPIC change charges at or below the safe harbor pricing structure will be
considered reasonable. The safe harbors are $1.25 for electronically processed LPIC changes
and $5.50 for manually processed LPIC changes. Additionally, when a customer requests an
LPIC change in conjunction with a PIC change, the company shall charge a rate that is equal to
500/0 of the full LPIC change charge rate, for both electronic and manual changes.
IT IS FURTHER ORDERED that all incumbent local exchange carriers shall file the
appropriate changes in their Idaho tariffs to become effective at the same time as the changes that
they must file in their federal tariffs, no later than October 17, 2005.
IT IS FURTHER ORDERED that no special customer notice or education, other than
that normally given pursuant to Commission Rules, is ordered or required.
THIS IS A FINAL ORDER. Any person interested in this Order 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. Within seven (7) days after any person has petitioned for
reconsideration, any other person may cross-petition for reconsideration. See Idaho Code 9 61-
626.
ORDER NO. 29806
DONE by Order of the Idaho Public Utilities Commission at Boise, Idaho this :l..Of+-
day of June 2005.
MARSHA H. SMITH, COMMISSIONER
ATTEST:
~tDJe D. Jewell
mission Secretary
O:GNRT0501 dw3
ORDER NO. 29806