990921_cc.doc

DECISION MEMORANDUM

TO: COMMISSIONER HANSEN
COMMISSIONER SMITH
COMMISSIONER KJELLANDER
MYRNA WALTERS
RON LAW
TONYA CLARK
LYNN ANDERSON
DON HOWELL
STEPHANIE MILLER
JOE CUSICK
DOUG COOLEY
WORKING FILE

FROM: CHERI C. COPSEY

DATE: SEPTEMBER 20, 1999

RE: APPLICATION OF CHOCTAW COMMUNICATIONS, INC. DBA SMOKE SIGNAL COMMUNICATIONS FOR A CERTIFICATE.
CASE NO. GNRT999.

On June 21, 1999, Choctaw Communications, Inc. d.b.a. Smoke Signal Communications filed an Application for a Certificate of Public Convenience and Necessity in compliance with Commission Rules of Procedures, IDAPA 31.01.01.111 and Procedural Order No. 26665. Choctaw is requesting authorization to provide prepaid local exchange service to residential customers on a resale basis pursuant to Title 61 of Idaho Code within the U S WEST (North and South) and GTE service areas in Idaho. Pursuant to Title 62 of Idaho Code, Choctaw presently provides interexchange services throughout the state of Idaho.
On August 27, 1999, the Commission ordered the matter be considered under Modified Procedure. Order No. 28105. On September 17, 1999, only Staff filed comments.
BACKGROUND
Choctaw was incorporated in Texas on August 5, 1996, as a limited liability company under Texas law. On November 30, 1998, Choctaw was converted to a Texas business corporation under Texas law. On March 26, 1999, the Idaho Secretary of State issued a Certificate of Authority to Choctaw under the Idaho Business Corporation Act. VarTec Telecom, Inc., an MTS provider in Idaho, owns eighty-one percent (81%) of Choctaw’s common stock. Choctaw states in its Application that it has no management agreements with VarTec. According to the Idaho 1999 USF Report, VarTec reported more than eleven million MTS minutes in Idaho in 1998. While VarTec apparently paid its USF assessments, Staff learned that VarTec may be delinquent with its Idaho Telecommunication Relay Service (TRS) payments and may owe more than seven thousand dollars ($7,000). On September 16, 1999, the TRS administrator, Mr. Dunbar, contacted VarTec and requested payment. If VarTec does not comply, Staff indicated it may seek an Order to Show Cause from the Commission.
STAFF COMMENTS
Staff reviewed Choctaw’s Application and concluded Choctaw understands the Commission’s rules and requirements. Based on the financial information presented to Staff and the lack of business history in Idaho, Staff required and received evidence of a $50,000 indemnity bond for Choctaw. In addition, Staff confirmed that Choctaw’s proposed notification and billing procedures comply with Idaho Customer Relations Rules IDAPA 31.41.01.202 and 304.
RECOMMENDATION
Based on Staff’s review of Choctaw’s Application, Staff concluded that Choctaw meets the requirements of the Commission’s Rules and Procedural Order No. 26665 and recommended the Commission approve the Application provided Choctaw verifies it intends to pay its state imposed assessments.
Commission Decision:
Should Choctaw’s Application for Certificate of Public Convenience and Necessity be approved?

Cheri C. Copsey
Staff: Doug Cooley

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