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Home My WebLink About20091020Comments.pdf--c:z-(!-cio ~ Conley Ward (Idaho State Bar # 1683) Cyntha A. Melilo (Idaho State Bar # 5819) GIVNS PURSLEY LLP 601 Banock Street, Suite 200 P.O. Box 2720 Boise, ID 83701-2720 Telephone: (208) 388-1200 Facsimile: (208) 388-1300 RECEIVED 1869 Gel" 2.0 PM 4: 24 \OAHOF!U~\t,\ÇC'I""N Uí\Ul1ES COrAM\S.',u . Attorneys for Idaho Telecom Allance BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION IN THE MATTER OF THE ANNAL REVISION OF THE UNIVERSAL SERVICE FUN SURCHARGES TO BECOME EFFECTIV OCTOBER 1, 2009 Cas No. GNR- T-û5 Order No. 30894 COMMENTS On September 2, 2009, the Idaho Public Utilities Commission (the "'Commission") issued Order No. 30894 in (the "'Order") and its Notice To USF Recipients That Funding Levels Must Be Adjusted (the Notice") in the above-entitled case. The Notice invited comments on the Commission's proposal to incrase residential rates for eight telecommuncations companes curently receiving Idaho Univeral Serce Fund ("'USF") support and fuer prposing to dec USF distbutions to each company in an amount equal to the revenues that would be generted by the rate increaes. In response to the Orer and Notice, the Idaho Telecm Allance ("ITA") files these Coments, by and thugh its attorneys of rerd, Givens Puley LLP, on bef of its membe, which include the telecmmuncations companes require to rase thei loc redential rates. For the rens stated her the ITA respefuly reuests that the Commsson red its prposa to require the USF repients to incre reidential loc exchage raes an rece thei USF draws. WR COMMS TO ORDER NO. 30894 - i 674248_4.DO COMMENTS Idaho Code Secon 62-610 provides, inter alia, that in order to quaify for Idaho USF distrbutions, an eligible telecmmuncations caer's residential local exchange rate must equal or 125 pecent of the weighted statewide averge rate. According to the Adminstrtor, the 2009 weighted statewide averge rate increaed frm $19.47 per month to $20.61 pe month. Thus, the 125 percent theshold rate eligibilty requirement incred from $20.61 to $25.76 per month. See Order at 2. Since all of the recipient companes' local rates are more than 3 pecent below this theshold reuirement, the Administrtor recommended that all eight companes be ordered to increase their residential basic local exchange rate to $25.76 per month. See IDAPA 31.46.01.106. The basic problem with the Administrator's recommendation is that it overtates the actul weighted statewide averge residential rate by an unown amount. It is ITA's undertanding, based upon converations with Commission staff, that the weighted statewde average rate was deterined by simply multiplying the posted tarff or price list rates times each company's line counts, with no consideration given to promotional discounts, crits or bundled ' line discunts. The fact is, however, that such discounts are widely used and heavily promoted by Qwest and Verzon, who collecvely account for almost 84% of the tota residential lines in Idaho. Orer at 2. Qwest, for instance, heas its monthy statements with a prminent asseron that customer ca "'save ever month" when local exchange serce is bunled with other telecmmuncations sece. See Exhbit 1, attched. Unforately, the ITA canot quatify the precise impact of discunts on the ac weighted sttewde average rate beus the necesar inforation to make th apprate cacuations is deeed pret. Assuing, however, that the "'save ever moth" clai is WR COMMENS TO ORDER NO. 30894 - 2 674248_ 4.DO factu, and fuher assuming that some customer in fact select one or more bundling options, it is a mathematical cerainty that the Administrator's calculation, which relies solely on posted, non-discounted rates, overtates the weighted statewide averge rates that customer are in fact paying. Using these overstated rates to arficially force the USF recipients' rates higher poses a real hardship for both the companes and thei customer. In the curent economic climate, any increase in local exchange rates creates a signficant compettive disavantage for the affeced company. As the Commission is well aware, wiline telecommuncations companes are steadily losing customer to competitors, priarly wireless carer. As the Order notes, Idaho residential local exchange lines decreased last year by nearly 11 percent, and the USF recipients are cerainly not immune to these statewide trends. An unjustified rate increase can only exacerbate these trends, resulting in even more customer abandonig wireline serce. Ths has negative consequences not only for the companies and customer involved, but also for the State USF. Since the regulated USF recpients are entitled by law to a fai opprtty to ear their Commission detered revenue requirement, reductons in line counts and resultat revenue losses create a negative feedback loop that, all other thigs being equal, push both rates and USF fuding and distrbutions higher stil. There is simply no reason for the Commission to promote ths result based solely on a calculation of the weighted statewide averge that is known to be both inaccute and overtated. Fortately, there is a statutory remedy at hand. Idaho Code Secton 62-605(e) spfically states that "'the residential an business basic loc exchange rates in effec on Julyl, 2005, shall constitute" the basis for the cacuation of the weighted statewde averges uness and until the Commssion deterines that subseuent rates should be us. In light of the obvious WRTT COMMS TO ORDER NO. 30894 - 3 674248_ 4.DO flaws in the Admistrtor's deterination of the curent statewide weighted average rates, and in considertion of the hardship rate increases would pose for both the companes and their customer, the ITA requests that the Commission contiue to use the residential and business basic local exchange rates in effect on July 1, 2005 as the basis for calcuating the weighted statewide average rates. The ITA fuer requests that the Commission rescid its Notice of Septembe 2, 2009 and leave curent residential rates and USF draws in effect. ~RESPECTFULLY SUBMITED ths .J day of October 2009. GIVENS PURSLEY LLP t il (l l! cynta A. Melilo Attorneys for Idaho Telecom Allance WRTT COMMS TO ORDER NO. 3089 - 4 674248_ 4.DO CERTIFICATE OF SERVICE ~ I hereby ceify that on the ,20 day of Octobe 2009, a tre and correct copy of the foregoing was sered upon the following individua(s) by the meas indicated: Origial and Seven Copies Filed: Jean D. Jewell, Secetar Idaho Public Utilities Commission 472 West Washigton Strt Boise, Idaho 83720-0074 o D~ D D U.S. Mail, postage prepaid Expres Mail Hand Deliver Facsimile Elecnic Mail ~aJ1 Cyntla A. Melilo WRTT COMM TO ORDER NO. 30894 - 5 6742483.DO EXHIBIT 1 , -y _,'~~'-"'._'_._'_"'_""~_'__"~'"'_''_~''''.''_'''.~M'''........_._... _...-- Qwest-' $pifi! GI Søf'litfl i Account Number: Bil Date: August 25,2009 Customer Service: 1 aOO~244-1111 Repair: 1 800~573-1311 Q~.~.~i~~. :_.......... ..........___.._.__9.~~~!:.i?~!!.~_......._..._..................... ......_ ............ ................_...... ..... ...._... ........_ ... INCLUDED IN YOUR STATEMENTø ,-"'~Thank you for being a Qwest customer J Save every month when you bundle qualifying local package, long dístal'Ie, high-peed Internet, digital TV and wielss servces. Contact us for a FRee ACCOUNT REViE to find out how much you can save by bundlng with Qwest. Some services not availale in aU areas. Calli 800.471.8325. Phone Soiice .'. i .~II ! ~J eTiOi Intornat Wireless TV Service $&rvÌC& SørvlC& Call or iiisit qwest.com 10 109m more! ~.. ~ § r--pr;~¡ou;.~Balance \ $37.16 - Payment Aug. 13 $37.16 .--.. :: Balance $.00 + Total New Charges $39.66 Due by Sep. 13, 2009 :: Total Amount Due $39.65 Thank You! Pkm fo. ter her lind mlrn lhe poioii belo with ¥Oil' ¡ioyme.1 2 6 Qwest:.~"Ii;"~¡. To cli yo bilùig addss. 0011 us at 1 60244-1111 Account: . ~ ,;.,. ".. ~ Paymnt Due Date: Sepembe 13, 200Total Amnt Due: $39.65 Amount Enclosed: See reverse of this page to enro In ~.' 811omatic payment, paperøss billing or a summar billng statemntl AV 01 021738 Oa044H 73 A**5DGT i '~Ilt iliiilt II11II 111i1\' 11t1111'1'11.11.11 l '11,11111111'llili11 Qwest POBox 29040 Phoenix, AZ 8&038.904 111l11i111'1,1I IIIII ii 11".1111111111 1lIlillllnllllllllll'lllll 61 0320&922353100183 2927082509 000000000000 000000396507