20150313Decision Memo.pdf

DECISION MEMORANDUM
TO:COMMISSIONER KJELLANDER
COMMISSIONER REDFORD
COMMISSIONER RAPER
COMMISSION SECRETARY
LEGAL
WORKING FILE
FROM:GRACE SEAMAN
DATE:MARCH 13,2015
RE:2014 IDAHO TELECOMMUNICATIONS RELAY SERVICE ANNUAL
REPORT;CASE NO.GNR-T-15-02.
BACKGROUND
Each year the Administrator of the Idaho Telecommunications Relay Service (TRS or
relay)files a report detailing the activities and status of the program during the previous year.
The Administrator also determines the funding requirements for the following year and submits a
recommended budget with the annual report.
In 1992,the Idaho Legislature established the Telecommunications Relay Service Act
(TRS Act)in accordance with the federal Title IV of the American with Disabilities Act.The
TRS enables 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 §61-130 1.Under the Idaho TRS Act,all telephone
corporations providing local or long-distance service (not including cellular or V0IP)must
provide TRS as set forth in the program and pay into the TRS Fund based upon an allocation
methodology adopted by the Commission.Idaho Code §61-1305.Pursuant to TRS Rule 202,
the Commission sets the TRS funding levels each year based upon the Administrator’s Annual
Report.IDAPA 3 1.46.02.202.
The Idaho TRS service provider,Hamilton Telecommunications (Hamilton),operates the
relay center where oral conversations are converted or “relayed”to text-type and vice versa.The
relay center also provides speech-to-speech,Spanish-to-Spanish,video,and Internet relay
services.
DECISION MEMORANDUM 1 MARCH 13,2015
THE 2014 ANNUAL REPORT
On January 29,2015,the TRS Administrator,Mr.Dunbar,submitted the 2014 TRS
Annual Report and the 2015 TRS Budget for Commission approval.The Administrator reported
that the relay center handled 32,254 minutes of conversation during calendar year 2014
compared to 38,724 minutes in 2013,a 14%decrease.Most of the conversation minutes were
associated with Captioned Telephone service (CapTel)’calls.During the last year,the number
of CapTel telephones increased by 8%and the total CapTel usage increased by 24%to 30,947
minutes.
Disbursements from the TRS fund to Hamilton in 2014 increased from $92,131 in 2013
to approximately S 108,394 in 2014.In-state traditional relay and CapTel services are
reimbursed by Idaho’s TRS fund,while the firm of Rolka Loube Saltzer Associates,LLC
(RLSA)reimburses 1-lamilton for out-of-state relay calls as well as intrastate InterneE relay and
Internet video relay service usage.The 2014 average answer time by Hamilton improved from
an excellent .4 seconds to .24 seconds.
1.2014 Expenses.The TRS expenses for 2014 totaled $147,243.The Administrator
reported that disbursements to 1-lamilton were S 108,394.The administrative fees and expenses
for the reporting year were $38,849 and the end-of-year fund balance was $299,491.
2.2014 Revenues and Allocations.The TRS fund is supported by assessments on local
exchange telephone service (residential and business)access lines and on billed intrastate long
distance minutes.The total number of intrastate long distance minutes reported by the telephone
companies in 2014 decreased by 21%from approximately 221,794,300 in 2013 to approximately
175,545,800 in 2014.The average monthly number of telephone lines reported also decreased
by 4%from 398,843 in 2013 to 382,843 in 2014.The 2014 annual contribution to the TRS fund
was $126,426,a decrease ofSl2,63l (9%)from 2013.Local exchange services contributed
$91,728 (73%)and MTS/WATS contributed $34,678 (27%).In Commission Order No.32999,
the per-line and per-minute assessments for 2014 were maintained at $0.02 and $0.0002,
respectively.A comparison of the 2014 revenue from the previous year is as follows:
CapTel allows hard-of-hearing users to hear the conversation as well as read the words on the phone’s built-in
screen.A trained operator “re-voices”the conversation from a caller into the voice recognition technology that
converts the words into a text message and provides the CapTel user with a more natural conversation.
DECISION MEMORANDUM 2 MARCH 13,2015
TRS Revenue Contributions 2014 2013
Local exchange service providers $91,728 $94,966
MTS/WATS providers 34,678 44,090
Interest earned on funds 31 31
Total $126,437 $139,087
3.Proposed 2015 Budget.The Administrator projects an annual operating budget of
$151,100.The 2015 budget reflects a stable traditional relay usage in 2015.The budget
estimate also includes the cost of a triennial audit that was conducted in the fourth quarter of
2014.If assessment rates remain unchanged,the Administrator calculates the 2015 end-of-year
fund balance will remain near its current level.
4.Proposed 2015 TRS Fundina Levels.Based on the proposed budget for 2015 and the
end-of-year reserves,the Administrator recommends that the Commission maintain the
assessment rates at the current level for local exchange lines at S.02 per month and $0002 per
intrastate MIS/WATS billed minute.This will maintain a cushion if unexpected expenses or
program changes occur.
TRS-Related FCC Activities
In the past two years,the FCC has issued Orders that may significantly impact the TRS
program and merit careful monitoring by the states.These are discussed below.
1.Internet Protocol Captioned Telephone Sen’ice (IP CTS).The FCC oversees and
funds a nationwide TRS program.which compensates carriers that provide out-of-state TRS calls
over traditional wireline facilities,as well as Voice over Internet Protocol (VoIP)services.2 One
form of relay service that uses VoW is the IP CTS.At the National Association of Relay
Administrators (NASRA)conference last fall,an FCC representative,reiterated that the FCC is
reassessing the transfer of fiscal and operational responsibility for IP-CTS from the FCC to the
states.3 Idaho does not administer IP CTS and does not have funding nor processes in place
should the FCC transfer responsibility of this program to state jurisdictions.
2 Report and Order and Further Notice of Proposed Rulemaking,In the Matter ofMisuse ofInternet Protocol
Captioned Telephone Service and Telecommunications Relay Services and Speech-to-Speech Services for
Individuals with Hearing and Speech Disabilities,CO Docket No.13-24 and CO Docket No.03-123 (FCC 13-118),
rd.August 26,2013 (FNPRM).
Id.at para.4.
DECISION MEMORANDUM 3 MARCH 13,2015
2.TDM3-to-IP Transition Experiments.The FCC adopted a framework for approving
trials,or experiments for preserving traditional communications-related values,such as public
safety,consumer protection,competition,and universal access,as networks complete the
transition from legacy circuit-switched,copper technology to an IP-based packet-switched fiber
and wireless networks.These experiments will include changes to the TRS,which will have a
direct impact on the Idaho relay.Idaho’s traditional TDM relay system and the associated
equipment are not compatible with a IP-based,packet-switched network.Additionally,Idaho
has an aging population of TRS users that may not be comfortable switching to IP-compatible
equipment.Thus,it is important for all state jurisdictions to monitor the results of the
experiments and provide performance feedback should the FCC require state TRS networks to
partially or fully transition to the IP TRS model.
STAFF’S RECOMMENDATION
Staff has reviewed the Administrator’s Report and believes the expenses are reasonable.
Staff believes the Idaho citizens continue to be well served by the Administrator and the relay
services provided by Hamilton Telecommunications.Staff also believes that the 2015 budget
projection of$151,I00 is acceptable based on the anticipated TRS expenses.The projected
revenue together with the current fund balance should be sufficient to meet 2015 expenses,
including any unforeseen events.Staff,therefore,agrees with the Administrator’s
recommendation to maintain the TRS contributions at the current funding levels of $0.02 per
access line per month and 50.0002 per intrastate MTS/WATS minute.
Time-Division Multiplexing (TDM)is primarily used for digital signals,but can also accommodate analog
multiplexing.This is the technology generally considered when referencing the Public Switched Telephone
Network (PSTN),an aggregate of the world’s circuit-switched telephone networks.
DECISION MEMORANDUM 4 MARCH 13,2015
COMMISSION DECISION
1.Does the Commission wish to accept the Administrator’s recommendation to
maintain the current TRS assessment rates adopted in Order No.32768?
2.Does the Commission wish to accept the annual report and adopt the Administrator’s
budget for 2015?
f?LLG /]C&j4-
Grace Seaman
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DECISION MEMORANDUM 5 MARCH 13,2015