20060310final_order_no_29997.pdf

Office of the Secretary
Service Date
March 10, 2006
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF REVIEWING THE
ADMINISTRATOR'S 2005 ANNUAL
REPORT AND ESTABLISHING THE
FUNDING LEVELS TO SUPPORT THE
TELECOMMUNICATIONS RELAY
SERVICE (TRS) PROGRAM
CASE NO. GNR-06-
ORDER NO. 29997
On January 20, 2006, the Idaho Telecommunications Relay Service (TRS)
Administrator submitted his calendar year 2005 Annual Report to the Commission. The TRS
program allows citizens who are hearing or speech impaired to engage in telephone
communications "in a manner functionally equivalent to that of individuals without hearing or
speech impairments.Idaho Code ~ 61-1301. Pursuant to TRS Rules 202 and 205, the
Commission reviews the Administrator s Annual Report and determines the appropriate funding
levels necessary to meet the program s expenses on a prospective basis. IDAPA 31.46.02.202
and 205. In this Order we accept the Administrator s 2005 Report and reduce the TRS
contributions effective April 1 , 2006 as set out in greater detail below.
THE 2005 ANNUAL REPORT
The Administrator reported that the relay center handled 362 086 minutes of traffic in
calendar year 2005. This represents an 11 % decrease from calendar year 2004. The relay center
operated by Hamilton Telecommunications converts or "relays" oral conversations to text-type
and vice versa. The relay center also provides speech-to-speech and Spanish-to-Spanish relay
services. Disbursements from the TRS fund to Hamilton in 2005 also decreased by about 11 %
from 2004. In-state relay traffic is reimbursed by Idaho s TRS fund while the National
Exchange Carrier Association (NECA) reimburses Hamilton for interstate calls that are placed
via the relay service. Hamilton provides traditional relay services at $1.31 per conversation
minute.
1. Expenses. TRS expenses for 2005 total $427 583. The Administrator reported
that disbursements to Hamilton were $366 120. The administrative fees and expenses for the
reporting year were $61,463. Administrative expenses were higher in 2005 due to issuance of
ORDER NO. 29997
the Request for Proposal (RFP) for the relay service, re-negotiation of the new service contract
awarded to Hamilton, and the third-party independent audit of the TRS fund.
2. 2005 Revenues and Allocations. During 2005, the total number of telephone
access lines reported to the TRS Administrator was approximately 665,850. The number of
intrastate toll minutes for 2005 totaled approximately 286 206 000 minutes. The amount of toll
minutes decreased by 1.38% from the prior year. The table below shows 2005 TRS contribution
sources and amounts.
2005 Revenue Sources
Local Service Providers
($.
04/month/line)
MTS/W A TS Providers
($.
0007/min)
Amount Percentage of Total
$319 006 61%
TOTAL
200 340
142
$519,488
39%
Interest Earned on Funds
100%
The 2005 year-end balance of the TRS fund was $359 000.
3. Proposed 2006 Budget.The Administrator projected an annual operating budget
for 2006 of $409 130. The budget includes an estimated 10% decrease in relay usage reflecting
user migration to Internet and video relay services.
The Administrator s Report also contained one note of caution. The Administrator
reminded the Commission that if the Federal Communications Commission (FCC) requires
states to pay for other relay-related services (such as Internet and video relay), the TRS fund will
be quickly depleted. If this were to occur, he calculated that immediate and substantial revenues
would be needed to replenish the fund.
4. Proposed TRS Funding Levels. Based upon the proposed budget for 2006, the
Administrator presented the Commission with three funding alternatives. His first alternative
would be to maintain the current assessment levels of $.04 per month per access line and $.0007
per minute per intrastate MTS/W A TS service. Maintaining current assessment levels would
produce a reserve balance of approximately $459 000. The Administrator s second alternative
would be to continue the current assessment level for access lines but reduce the intrastate
MTS/W A TS per minute contribution from $.0007 to $.0003. This would produce a reserve
balance of approximately $359 000.
ORDER NO. 29997
Finally, the Administrator s third option would be to reduce both assessment levels.
Reducing the monthly rate to $.02 per access line and the intrastate MTS/W A TS per minute rate
to $.0006 would produce a reserve balance of approximately $281 000.
STAFF RECOMMENDATION
Following its review of the Administrator s Report, the Staff recommended the
Commission adopt the Report and the Administrator s projected budget for 2006. Staff also
concurred with the Administrator s recommendation that existing TRS contribution levels may
be reduced. Based upon the continuing reduction in TRS minutes and the 2005 year-end
balance, the Staff proposed another funding option for the Commission s consideration. Staff
proposed that the access line rate be reduced to $.03 per month and that the intrastate
MTS/W A TS per minute rate be reduced to $.0003. Reducing the access line and per minute
contributions would provide an estimated reserve balance of approximately $270 000.
DISCUSSION
In this Order, we formally adopt the Administrator s 2005 Annual Report. Based
upon our review of the Report, we find that the 2005 expenses are reasonable. Idaho citizens
continue to be well served by the Administrator and the relay services provided by Hamilton
Telecommunications. TRS services include "711" dialing and Spanish language services.
The Commission also finds that the 2006 budget projection of $409 130 is reasonable
based upon the anticipated expenses of the TRS program. The Commission further finds that the
projected revenue together with the current fund balance should be sufficient to meet 2006
expenses.
Based upon our reView of the Annual Report, the Administrator s contribution
alternatives and the Staff s recommendations, we find that it is just and reasonable to reduce the
TRS contributions from their current funding levels. The TRS contributions shall be set at $.
per access line per month and $.0003 per intrastate MTS/W A TS minute. The Commission
further finds that the projected 2006 allocation between local service and toll service (61 % and
39%, respectively) is just and reasonable given the estimates in the number of access lines and
toll minutes. The reduction in TRS contribution levels shall be effective April 1 , 2006.
ORDER NO. 29997
ORDER
IT IS HEREBY ORDERED that the TRS funding obligation of telephone
corporations providing local service in Idaho be reduced from the existing level to $.03 per
month per access line.
IT IS FURTHER ORDERED that the TRS funding obligation for telephone
corporations providing intrastate MTS/W A TS service be reduced from the existing level to
0003 per intrastate billed minute.
IT IS FURTHER ORDERED that the reduced TRS contribution levels become
effective on April 1 , 2006.
IT IS FURTHER ORDERED that the TRS Administrator continue to monitor
expenditures and revenues. Any time he believes that revenues will not cover expenditures, he is
to immediately notify the Commission so that we may evaluate whether changes in the existing
TRS funding obligations are necessary.
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. GNR-06-
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. GNR-06-Within seven (7) days after any person has petitioned for
reconsideration, any other person may cross-petition for reconsideration. See Idaho Code ~~ 61-
626 and 62-619.
ORDER NO. 29997
DONE by Order of the Idaho Public Utilities Commission at Boise, Idaho this IOrA
day of March 2006.
MARSHA H. SMITH, COMMISSIONER
ATTEST:
bls/O:GNRT0601 dh
ORDER NO. 29997