20050408Final Order No 29751.pdf

Office of the Secretary
Service Date
April 8, 2005
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF THE REDUCTION TO
THE SURCHARGE FOR THE IDAHO
TELECOMMUNICATIONS SERVICE
ASSISTANCE PROGRAM ORDER NO. 29751
CASE NO. GNR- T -05-
The Idaho Telecommunications Service Assistance Program (ITSAP) provides
recipients with a reduction in costs of residential basic local exchange telephone service for
eligible customers. Funds for the program are raised through an ITSAP surcharge on all end-
user business, residential and wireless access service lines. The Commission determines the
uniform statewide monthly surcharge, and the Idaho Department of Health and Welfare
administers the program, working with federal programs to "maximize federal 'lifeline' and 'link
' contributions to Idaho s low-income customers.Idaho Code 9 56-901(1). The ITSAP
Administrator provides an annual report to the Commission to enable the Commission to
determine the appropriate level of the ITSAP surcharge.
On March 22, 2005, the ITSAP Administrator filed a revised annual report for the
fiscal year ending December 31 , 2004. Gross revenues from ITSAP surcharges for the year
totaled $1 962 758, approximately one-half of which was assessed on local wireline services;
wireless customers contributed approximately one-half. Disbursements to eligible subscribers
increased by 6% over the previous year to $1 273,466. Approximately 30 700 customers were
receiving ITSAP support by the end of the year, which is an increase of almost 10% from 2003.
Administration costs paid to telephone companies and the ITSAP Administratpr s fees also
increased, but the ITSAP fund contained a balance at the end of the year of $312 992.
The Administrator s report also noted a fairly significant increase in the number
wireless access lines over the previous year, increasing to approximately 642 000. The number
of residential local access lines decreased slightly to approximately 482 000 and the average
reported number of business lines decreased slightly to approximately 198 000. The average
total number of lines increased overall by about 66 800, however, an increase of nearly 5%, to
approximately 1 321 000.
The Administrator estimates the 2005 surcharge funds will remain relatively stable
and also estimated the number of ITSAP recipients will increase by approximately 6%. The fund
ORDER NO. 29751
Administrator expects telephone company administration costs to increase by approximately 5%
and the ITSAP Administrator fees and expenses to increase by approximately 10%.
The current surcharge level is $.12 on each end-user business, residential and
wireless access service line. The surcharge level was increased to its current level in March
2003. At that time, an increase in the surcharge was necessary because the fund balance was
declining and the surcharge level was insufficient to meet the funding requirements for all
eligible households. With the surcharge level at $.12 per line, and an increase in access lines on
which the surcharge is applied, the reserve balance in the ITSAP fund has significantly
increased. The Administrator therefore recommended that the surcharge rate be reduced to $.
per month per access line. At that rate, the Administrator projected a year-end fund balance for
2005 of approximately $464 287. Staff reviewed the Administrator s report and recommended
the Commission adopt the Administrator s recommendation to reduce the ITSAP surcharge to
07 per access line per month.
Based on the ITSAP Administrator report and Staff recommendation, the
Commission has determined to decrease the ITSAP surcharge from $.12 per access line per
month to $.07 per access line per month. The Administrator s report shows the fund balance is
continuing to increase, and reducing the surcharge level to $.07 should result in sufficient funds
to meet the 2005 funding requirements for all eligible households, while reducing the ITSAP
reserve balance to a reasonable level.
ORDER
IT IS HEREBY ORDERED that the ITSAP surcharge is decreased from $.12 to $.
per access line per month on all end-user business, residential and wireless access services. The
ITSAP surcharge amount of$.07 per access line shall be effective May 1 2005.
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. 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. 29751
DONE by Order of the Idaho Public Utilities Commission at Boise, Idaho this fl~
day of April 2005.
ATTEST:
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Commission Secretary
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ORDER NO. 29751
PAUL KJELL DER, PRESIDENT
SHA H. SMITH, COMMISSIONER
ENNIS S. HANSEN, COMMI SIONER