20050518Qwest comments.pdf

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Mary S. Hobson (ISB# 2142)
Stoel Rives LLP
101 South Capitol Boulevard - Suite 1900
Boise, ill 83702
Telephone: [phone]
Facsimile: [phone]
mshobson~stoel.com
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Adam L. Sherr
QWEST CORPORATION
1600 Seventh Avenue, Room 3206
Seattle, Washington 98191
Telephone: [phone]
Facsimile: [phone]
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF THE
INVESTIGATION OF INTRASTATE
PRESUBSCRIBED INTEREXCHANGE
CARRIER (LPIC) CHANGE CHARGES
CASE NO.: GNR-O5-
COMMENTS OF QWEST
CORPORATION
Qwest Corporation (Qwest), by and through its undersigned attorneys, and pursuant to
Order No. 29759, provides these comments concerning possible changes to the IntraLAT
Presubscribed Interexchange Carrier (LPIC) Change charges.
BACKGRO UND
On March 28 2005, the Commission issued a Notice of Investigation and Notice of
Modified Procedure, Order No. 29743 , to investigate whether the LPIC change charges
established by the Commission should coincide with the interstate PIC change charges
established by the Federal Communications Commission (FCC). In the interstate jurisdiction
Presubscribed Interexchange Carrier (PIC) change charges are imposed by local exchange
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carriers (LECs) on their end use customers when those customers change their presubscribed
interexchange carrier (IXC). These PIC change charges are contained in the LEC's federal tariff.
In its report and order released earlier this year, the FCC required incumbent LECs to
adopt separate PIC change charges for changes that are processed electronically and those that
are made manually. The FCC adopted a safe harbor of $1.25 for electronically processed
changes and $5.50 for manual changes. The FCC also required that when a customer changes its
PIC at the same time it changes its intraLA T A presubscribed interexchange carrier (LPIC),
incumbent LECs may assess only half of the federally tariffed PIC change charge. Under that
circumstance, the incumbent LEC is left to recover the remaining costs of making the change
from the intrastate jurisdiction. The FCC ordered incumbent LECs to file revised federal tariffs
by April 14, 2005.
The Commission s Order No. 29743 notes that it "has not formally established a safe
harbor rate for LPIC change charges" but that it has "a precedent of approving a rate that is
within the FCC's safe harbor or $5.00." Under its existing tariff and catalog provisions, Qwest
charges $5.00 to process a change to the LPIC. If a customer were to request simultaneous
changes of both the PIC and the LPIC, Qwest's tariff and catalog refers to the FCC tariff and
imposes a single charge at the level permitted under the interstate tariff. 2 However, once the
new rates for interstate PIC change charges become effective 3 Qwest will not be permitted to
Presubscribed Interexchange Carrier Charges WC Docket No. 02-, Report and Order, FCC 05-32 (reI.
Feb. 17 2005) PIC Change Charge Order
Qwest's Access Service Tariff for its operations in northern Idaho provides in Section 12.3.3.1.e "when
end users or PSPs simultaneously choose or change an intraLATA and interLATA primary IC, only the PIC change
charge from F.C. No., Section 13 will apply." Qwest's Access Service Catalog pertaining its southern Idaho
operations contains the same language in Section 12.3.3.1.e.
FCC extended the date on which carriers must file revised tariffs to October 17, 2005. The revised tariff
would become effective November 1 2005.
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recover more than fifty percent of the interstate tariff amount from the interstate jurisdiction.
Without a change to the Idaho tariff and catalog provisions, Qwest will be left with only half the
compensation it would receive for processing a change to the PIC on a standalone basis.
However, the issues associated with implementing-the required changes at both the interstate and
intrastate levels are as much a concern as the total level of compensation.
On April 5, 2005 , Qwest met with representatives of the Wireline Competition Bureau of
the FCC to discuss Qwest's concerns with the implementation of the FCC'PIC Change Charge
Order. In response to the requests of Qwest and other several industry participants, on April 8
2005, the FCC issued on order extending the date for filing tariffs in compliance with the PIC
Change Charge Order to October 17, 2005.
II.IMPLEMENT A TI ON CONCERNS WITH FCC ORDERED CHANGE
Implementation of the FCC'PIC Change Charge Order as it pertains to charges in the
interstate jurisdiction requires that Qwest change billing and ordering systems, redesign internal
processes, conduct testing and employee training, and coordinate federal tariff changes. It is
because of these difficulties that the FCC granted an extension of the compliance deadline to
October of this year. The following provides an overview of the kinds of steps Qwest must make
to comply with the FCC order.
The Customer Record Information System (CRIS) acts as the billing system and account
database for millions of Qwest customers. It has three regional platforms that relate back to the
original bell operating companies, i.e., Pacific Northwest Bell, Mountain Bell, and Northwestern
Bell. Each of these platforms has different structures, requiring different implementation
solutions and all have been built with the assumption that one PIC charge would apply without
regard to whether the change was made manually or electronically. To modify the system to
address the FCC's two-tiered pricing, a new field identifier ("Fill") must be created in addition
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Boise-183862.1 0029164-00012
to the existing PIC Universal Service Order Codes ("USOCs
).
These Fills will be used to
indicate whether a service order is manual or electronic. Adding new Fills to each regional
platform requires extensive IT coding and assessment.
In addition to CRIS, Qwest must also modify the Regional Subscription System (RSS),
which is the primary subscription and account database used for electronic business-to-business
commerce between the IXCs and Qwest. Qwest will be required to modify rates in its Billing
and Receivables Tracking (BART) carrier billing system to apply electronic charges for RSS-
submitted orders. On the other hand, Qwest will also have to uniquely identify orders that are
submitted from the Carrier Service Bureau (CBS) to apply manual rates. To successfully
implement this change to the rate structure, new programming logic will have to be created and
tested to meet the new requirement that manual and electronic changes will produce different
charges.
Making the necessary changes to the Qwest system will be time-consuming and involve
multiple layers of testing and internal certification. Training materials must be prepared and
customer service representatives working in all segments of the business must be trained to
properly operate the systems in light of the new PIC change charge structure.
As Qwest will discuss in more detail in the following section, the implementation
procedures described here will become even more burdensome if the FCC does not reconsider its
fifty percent rule" i., the provision that the LECs may only charge fifty percent of the
federally tariffed rate (whether manual or electronic) when customers simultaneously change
both their PIC and LPIC. This provision will require additional changes to billing systems and
processes apart from those necessary to make the interstate rate structure change and will require
wholesale replacement of state tariffs.
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III.RECONSIDERATION OF THE FIFTY PERCENT RULE
On April 14, 2005 , Qwest filed a Petition for Reconsideration of the FCC'PIC Change
Charge Order. In its petition Qwest asked that the FCC modify its Order to abandon the policy
of splitting the federal rate in half where simultaneous PIC and LPIC changes are requested.
Under the Qwest proposal, the requirement that state regulators establish individual cost-
recovery mechanisms to cover the intrastate portion of the costs would be eliminated. This
change would allow state tariffs to continue to reference the federal rate in situations in which
the customer simultaneously requests a change to both the PIC and the LPIC.
Modification of the PIC Change Charge Order in the manner suggested by Qwest will
achieve the FCC's objectives but impose fewer administrative costs and regulatory burdens for
affected companies, including Qwest. Under this proposal Qwest would not be required to
further modify its billing systems to levy a state-specific charge. Training for customer service
employees could be streamlined if separate state charges will not be levied when there is a
simultaneous PIC/LPIC change. In addition, Qwest and others will avoid the need to change
their intrastate tariffs and catalog provisions, which currently refer to the federal charge.
Qwest's recommendation in its FCC petition would establish an efficient policy that
would maintain federal rates for federal PIC changes and state rates for LPIC changes.
Furthermore, for rate-regulated LECs this Commission maintains jurisdiction over whether there
should be an increased or different charge to cover the intrastate costs associated with a
simultaneous PIC/LPIC change. Qwest's methodology would accomplish the federal regulatory
objective of preventing over-recovery ofLEC costs while preventing the excessive expense that
the current FCC order would create.
This Commission has also requested that ILECs supply information on the actual usage
of electronic processing for PIC/LPIC changes. While Qwest does not have Idaho-specific
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numbers, Qwest estimates the volume of electronic requests to be almost 20% of all requested
PIC/LPIC changes.
IV.RECOMMENDATION
These comments have focused on the status of the PIC/LPIC change charge issue at the
interstate level. While the FCC will ultimately decide whether to abandon its fifty percent rule
Qwest believes it is beneficial for this Commission to understand Qwest's position on this FCC
policy change because of its effect on the intrastate jurisdiction. As noted the FCC has granted
an extension of the compliance date for its order to allow the affected companies to modify their
billings and other internal systems, train their employees and amend their interstate tariffs.
Qwest is hopeful that in this interim period the FCC will also grant its Petition for
Reconsideration.
In the meantime, Qwest respectfully requests that this Commission refrain from requiring
any changes to intrastate tariffs and catalogs until the FCC grants or denies Qwest's petition.
Qwest further recommends that the Commission grant affected LECs a reasonable period of time
to implement any changes to their billing and other internal systems that may be required in the
event that separate state and federal PIC/LPIC charges are required in those cases where
customers simultaneously change their inter- and intrastate carriers.
Respectfully submitted this 18th day of May, 2005.
Qwest Corporation
~~~~
Mary S. obson
Stoel Rives LLP
Adam Sherr
Qwest
Attorneys for Qwest Corporation
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CERTIFICATE OF SERVICE
I hereby certify that on this 18th day of May, 2005 , I served the foregoing COMMENTS
OF QWEST CORPORATION upon all parties of record in this matter as follows:
Jean Jewell, Secretary
Idaho Public Utilities Commission
472 West Washington Street
O. Box 83720
Boise, ill 83720-0074
i i ewell~JJuc. state.id. us
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Weldon Stutzman
Idaho Public Utilities Commission
472 West Washington Street
O. Box 83720
Boise, ill 83720-0074
Telephone: [phone]
weldon.stutzman~puc.Idaho. gov
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Joe Cusick
Idaho Public Utilities Commission
472 West Washington Street
O. Box 83720
Boise, ill 83720-0074
Telephone: [phone]
ioe.cusick~puc.ldaho.gov
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~~~
Brandi L. Gearhart, PLS
Legal Secretary to Mary S. Hobson
Stoel Rives LLP
COMMENTS OF QWEST CORPORATION - Page 7
Boise-183862.l 0029164-00012