20170329final_order_no_33732.pdf

Office of the Secretary
Service Date
March 29,2017
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF THE SURCHARGE )
FOR THE IDAHO TELECOMMUNICATIONS )CASE NO.GNR-T-17-03
SERVICE ASSISTANCE PROGRAM )
__________________________________
)ORDER NO.33732
Each year,the Administrator of the Idaho Telecommunications Service Assistance
Program (ITSAP)files a report detailing the activities and status of the program during the
previous year.ITSAP provides eligible recipients with a reduction in the cost of residential basic
local exchange telephone service.Funds for the program are raised through a 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 in conjunction with federal programs to “grant limited federal ‘lifeline’
contributions to low-income customers.”See Idaho Code §56-901(1).
Idaho telephone companies provide assistance in the form of a monthly discount of
$2.50 to eligible applicants.Idaho Code §56-902.To be eligible to receive reimbursement for
providing low-income benefits (ITSAP and the federal Lifeline assistance),a company must be
designated as an eligible telecommunications carrier (ETC)by a state commission.47 C.F.R.§
54.20 l(a)(l).ITSAP benefit applicants must be the head of a household and meet narrowly
targeted eligibility criteria established by the Department of Health and Welfare.Idaho Code §
56-903.
THE 2016 ITSAP ANNUAL REPORT
In the annual report filed March 8,2017,the ITSAP Administrator reported a 17%
decrease in wireline access lines,a 2%decrease in wireless access lines,and a 42%decrease in
the number of ITSAP recipients,from the previous year.The average number of wireline access
lines per month reported to the Administrator was 363,888,compared to 435,822 in 2015.The
average number of wireless access lines per month was 1,384,720 compared to 1,414,763 in
2015.Overall,there was a decrease of about 101,976 in the total number of average monthly
lines subject to the ITSAP surcharge —1,748,608 lines per month compared to 1,850,584 in
2015.The average number of reported ITSAP recipients per month decreased from 6,693 in
2015 to 3,880 in 2016.
ORDER NO.33732 1
The gross surcharge revenue for the year was reported at $235,421,of which $42,812
(18%)was assessed on wireline services,and $195,610 (82?/o)was assessed on wireless services.
The administrator explained that ETCs remit net surcharge revenue,which is gross surcharge
revenue less any assistance credits provided to eligible recipients and the ETC’s administrative
costs.Net surcharge revenue collected and deposited in 2016 totaled $201,503.
Telecommunications companies received $126,830 in disbursements for ITSAP
credits paid to eligible recipients,compared to $226,245 in 2015.Disbursements for company
administrative costs decreased from $33,089 in 2015 to $23,235 in 2016.
The Administrator’s fees and expenses were $8,827 for 2016.The Administrator
reported a fund cash balance at the end of 2016 of $1,354,852.
2017 BUDGET AND TRENDS
The ITSAP Administrator projected that funding requirements for 2017 will continue
to decrease.The Administrator estimated that the ITSAP recipient reimbursements to qualifying
companies for 2017 will be about $101,156,and that expenses will be $20,925 for costs
associated with administration of the program,including a triennial audit and legal fees.
To establish the 2017 budget,the Administrator estimated that the number of access
lines subject to the surcharge will be about I ,725,778 per month,and the average number of
ITSAP recipients will be about 2,681 per month.Based on this data,the Administrator projected
the funding requirements for 2016 will be about $122,081.
In 2015,the surcharge rate was reduced to $0.01 per access line.Nonetheless,the
decline in credit recipients has caused the fund to continue growing each year.The
Administrator believes it is impractical to reduce the surcharge rate below $0.01,and thus
recommended eliminating the rate for all wireline and wireless access lines until the next annual
budget review.The Administrator confirmed that the fund balance would remain more than
sufficient to reimburse companies for assistance credits provided,and still preserve an adequate
balance for unexpected occurrences.The estimated balance for end-of-year 2017 is projected at
about $1,232,771.
Staff reviewed the 2016 annual report,the 2017 budget,and the 2017 funding
recommendation.Staff agreed that a further reduction of the surcharge rate is impractical and
supports the recommendation to suspend surcharge rates for all wireline and wireless access lines
ORDER NO.33732
for budget year 2017.Staff therefore recommended that the Commission approve the
Administrator’s 2017 budget and proposal to suspend the surcharge rates for budget year 2017.
COMMISSION FINDINGS
The Commission has reviewed the Administrator’s 2016 annual report,proposed
2017 budget,and Staff’s review.We find that the Administrator’s recommendations are fair,
just and reasonable,and that it would be impractical to reduce the surcharge rate.We further
find it appropriate to suspend the surcharge rate for budget year 2017,and find that doing so will
not deplete the fund of a sufficient balance,even in the event of unanticipated program changes.
Accordingly,we accept the Administrator’s 2016 annual report and proposal to suspend the
monthly ITSAP surcharge rate for budget year 2017,and we approve the Administrator’s 2017
budget.We further find that all reporting companies should continue to file regular reports with
the Administrator.Accordingly,we direct the Administrator to send a notice to reporting
companies of their ongoing reporting requirement,and that the suspension of surcharge rates is
for budget year 2017 only,subject to further review and determination by this Commission.
ORDER
IT IS HEREBY ORDERED that the Commission accepts the Administrator’s 2016
annual report and 2017 budget.
IT IS FURTHER ORDERED that the monthly ITSAP surcharge rate shall be
suspended,effective May 1,2017,until the next annual budget review.
IT IS FURTHER ORDERED that the Administrator shall send a notice to reporting
companies that their reporting requirements are ongoing and that the surcharge rate suspension is
for budget year 2017,subject to further review by the Commission.
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 §6 1-626.
ORDER NO.33732 3
DONE by Order of the Idaho Public Utilities Commission at Boise,Idaho this
day of March 2017.
PAUL KJE ER,PRESIDENT
ERIC ANDERSON,COMMISSIONER
ATTEST:
//
Diane M.Hanian
Commission Secretary
O:GNR-T-I 7O3djh
ORDER NO.33732 4