20230828MNL Reply to Supplemental Comments.pdf

MILLENNIUM NETWORKS,LLC’S REPLY TO SUPPLEMENTAL COMMENTS PAGE 1 OF 7
Elizabeth A. Koeckeritz, ISB No. 7670
Charlotte V. Cunnington, ISB 11967
GIVENS PURSLEY LLP
601 West Bannock Street
P.O. Box 2720
Boise, Idaho 83701-2720
Office: [phone]
Fax: [phone]
[e-mail]
Attorneys for Millennium Networks, LLC
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF MILLENNIUM
NETWORKS, LLC’S NOTICE OF THE
ACQUISITION OF CERTAIN ASSETS OF
CTC TELECOM, INC.
Case No. MNL-T-23-01
CTL-T-23-03
MILLENNIUM NETWORKS,LLC’S REPLY
TO SUPPLEMENTAL COMMENTS
Millennium Networks, LLC (“Millennium” or “Company”) respectfully submits the
following Reply Comments in response to Supplemental Comments filed by the Idaho Public
Utilities Commission Staff (“Staff”) on August 21, 2023.
BACKGROUND
On May 26, 2023, Millennium filed a notice with the Idaho Public Utilities Commission
(the “Commission”) that it had acquired certain assets of CTC Telecom, Inc. (“CTC”) within Ada
County, Idaho. The notice was provided to the Commission in support of CTC’s request to the
Commission for an Amended Certificate of Public Convenience and Necessity (“CPCN”).
Staff decided that it needed more information to determine if the purchase of the assets met
the requirements of Idaho Code § 61-328 and requested Commission to open a new case for CTC
(reference June 27, 2023 Decision Memo). The Commission opened Case No. CTL-T-23-03 on
RECEIVED
Monday, August 28, 2023 3:54:07 PM
IDAHO PUBLIC
UTILITIES COMMISSION
MILLENNIUM NETWORKS,LLC’S REPLY TO SUPPLEMENTAL COMMENTS PAGE 2 OF 7
July 12, 2023 in Order No. 35852, under which Staff then requested detailed financial information
concerning the transaction through separately issued requests for production.
Company responded to Commission Staff’s request for more information by objecting to
Commission’s review of the asset purchase on the grounds that Commission lacks the authority to
request the information under Idaho Code § 61-328. The companies involved in the asset purchase
are telecommunications companies and competitive local exchange companies (CLECs), and as
such, they are not electric utilities subject to Commission authority under Title 61-328 of the Idaho
Code.
On August 21, 2023, Commission Staff responded to Company’s Reply to Comments and
restated its position and its request for documents pertaining to the asset purchase.
These comments are provided in response to Commission Staff’s Supplemental
Comments.
COMPANY REPLY TO SUPPLEMENTAL COMMENTS
1.Investment of Authority
Staff argues that the Commission has jurisdiction to regulate the business conduct of
Company because Company is a public utility providing utility services under Idaho Code § 61-
121, and Idaho Code § 61-501 vests the Commission “with the power and jurisdiction to supervise
and regulate every public utility in the State of Idaho.” Supplemental Comments, p. 3.
Company agrees that Idaho Code § 61-501 vests the Commission with the power and
jurisdiction to supervise and regulate every public utility in the State of Idaho. However, that power
and jurisdiction is subject to the limitations set forth in Idaho Code § 62-622, which expressly
disallows rate-regulation by the Commission of competitive carriers holding CPCNs. By way of
background, Section 62-622 of the Idaho Code was adopted in response to the federal
Telecommunications Act of 1988 (Act). The Act was introduced to deregulate certain
MILLENNIUM NETWORKS,LLC’S REPLY TO SUPPLEMENTAL COMMENTS PAGE 3 OF 7
telecommunications companies after Congress found that it was in the public interest to encourage
competition. Idaho Code § 62-602 reflects these policy changes: “The legislature further finds that
the telecommunications industry is in a state of transition from a regulated public utility industry
to a competitive industry.” With the intent of deregulating certain telecommunications companies,
CLECs were specifically carved out from the scope of Title 61 regulation, except for some
noneconomic matters. Company falls within the definition of a telecommunications company not
subject to Title 61.
As such, the Commission is limited to “determin[ing] the noneconomic regulatory
requirements for all telephone corporations providing basic local exchange service or designated
as an eligible telecommunications carrier pursuant to Sections 62-610A through 62-610F, Idaho
Code, including, but not limited to, such matters as service quality standards, provision of access
to carriers providing message telecommunications service, filing of price lists, customer notice
and customer relation rules.” Idaho Code § 62-622(5).
Staff’s First Production Request includes items that go to the heart of rate regulation,
including the Asset Purchase Agreement, work papers, including formulas, used to determine the
sales prices, and the accounting treatment of the purchase. See First Production Request of the
Commission Staff, Request Nos. 1, 6, 10, 11 and 12. This type of financial information is directly
related to rate regulation and has no relation to noneconomic requirements such as customer
relations rules.
2.Company’s CPCN
Staff further asserts that the Commission’s authority under Idaho Code § 61-528, which is
the authority that granted the Commission to approve Company’s CPCN designation, is the same
authority that permits Staff to request discovery on the asset purchase. However, the scope of the
MILLENNIUM NETWORKS,LLC’S REPLY TO SUPPLEMENTAL COMMENTS PAGE 4 OF 7
discovery request far exceeds the required information Commission required from Company for
Company to initially obtain its CPCN. Compare Case No. MNL-T-09-01 with Case No. MNL-T-
23-01.
Staff argues that because the Company originally provided financial information to obtain
its CPCN, that it must now continue to provide financial information. However, the information
required to be provided by Company to obtain its CPCN is substantively different than the financial
information requested by Staff at this time. Procedural Order No. 26665 governs the information
that may be requested in order to obtain or amend a CPCN. When it first applied for its CPCN,
Company provided financial information sufficient to establish that it possessed adequate financial
resources to provide the proposed services. See Case No. MNL-T-09-01, Application. It was also
required to provide initial tariff and price sheets. See Order 26665 p. 6, p. 12. This is the extent of
financial information required by the Commission for a company to obtain its CPCN. The
Commission accepted the information provided by Company and issued its CPCN. The specific
financial information now requested by Staff goes beyond the scope required of CPCN applicants
or holders.
In fact, to amend its CPCN, the Company would only be required to provide: the date on
which it proposes to begin construction or provide service, a map showing where the applicant is
proposing to provide service, a statement that it will comply with Commission rules, and proposed
tariff and price sheets.1 See Order 26665, p. 15. Further, on June 23, 2023 the Company filed its
tariff revisions with the Commission, reflecting an issue date of June 23, 2023 and requested an
effective date of August 1, 2023. On July 28, 2023, the Company received confirmation of the
1 Because Company’s CPCN is statewide, it does not intend to amend its CPCN due to its acquisition of CTC’s Ada
County wireline assets.
MILLENNIUM NETWORKS,LLC’S REPLY TO SUPPLEMENTAL COMMENTS PAGE 5 OF 7
Commission’s acceptance for filing of its revised tariff, reflecting an effective date of August 1,
2023.
Staff makes its request for production based on the argument that by entering into the asset
transfer agreement, Millennium has materially changed its financial position. This assertion is
incorrect. Millennium has simply gained assets, which, as discussed above, is not subject to
Commission oversight or review. The Company has responded to Staff’s requests by providing
details of the transaction which the Company believes are adequate, while not necessarily required
by statute, that Commission Staff can ascertain for public interest concerns. Of note, no public
comments were received (or at least posted) during the Commission-ordered comment period.
3.Idaho Code § 61-328
Staff relies upon Idaho Code § 61-328 for its jurisdiction to examine the asset transfer. As
previously discussed in Company’s Reply to Comments, filed August 2, 2023, this section of the
Code applies to electric utilities only and provides the Commission the authority to approve, by
order, the sale of property by an electric public utility or electrical corporation. Idaho Code § 61-
328. In its Supplemental Comments, Staff argues that this statute can be relied upon as a guide to
consider (1) whether the transaction would follow the public interest; (2) whether the cost of and
rates of supplying service would be increased because of the transaction; and (3) whether the
transferee has the bona fide intent and financial ability to operate and maintain the system in the
public service.
However, the Idaho Supreme Court has been clear that the Commission does not have the
discretion to expand its statutorily-given jurisdiction holding that:
The Idaho Public Utilities Commission has no authority other than
that given to it by the legislature. It exercises a limited jurisdiction
and nothing is presumed in favor of its jurisdiction . . . . As a general
rule, administrative authorities are tribunals of limited jurisdiction
MILLENNIUM NETWORKS,LLC’S REPLY TO SUPPLEMENTAL COMMENTS PAGE 6 OF 7
and their jurisdiction is dependent entirely upon the statutes
reposing power in them and they cannot confer it upon themselves,
although they may determine whether they have it. If the provisions
of the statutes are not met and compliance is not had with the
statutes, no jurisdiction exists.
Washington Water Power Co. v. Kootenai Env't All., 99 Idaho 875, 879, 591 P.2d 122, 126 (1979)
(citing Arrow Transp. Co. v. Idaho Public Utilities Comm'n, 85 Idaho 307, 379 P.2d 422 (1963)).
Nothing in Idaho Code § 61-328 confers jurisdiction over a CLEC. Simply put, Staff is
impermissibly conferring upon the Commission a power that is beyond its limited jurisdiction.
Staff asserts that because Idaho Code § 61-328 was used in a water utility proceeding, that
it is applicable to this matter. Whether Idaho Code § 61-328 can properly be applied to a water
utility matter is beyond the scope of this response; however, both water companies and electric
companies are rate-regulated utilities and are substantively different from CLECs.
Company reiterates that neither the referenced code nor any other Idaho Code provision
provides the Commission with the authority to review the asset sale.
CONCLUSION
Because Idaho Code § 61-328 is inapplicable to the Company and to the purchase
transaction of a telecommunications company and there is no corresponding code that would
provide the Commission authority over this type of transaction, Millennium, again, respectfully
requests that the Commission Staff inquiry into this matter be dismissed.
Dated this 28th day of August, 2023.
GIVENS PURSLEY LLP
By
Elizabeth A. Koeckeritz
Attorneys for Millennium Networks, LLC
MILLENNIUM NETWORKS,LLC’S REPLY TO SUPPLEMENTAL COMMENTS PAGE 7 OF 7
CERTIFICATE OF SERVICE
I hereby certify that on August 28, 2023, I caused to be served a true and correct copy of
the foregoing document to the person(s) listed below by the method indicated:
Jan Noriyuki, Commission Secretary
Idaho Public Utilities Commission
11331 W. Chinden Blvd., Bldg. 8, Suite 201-A
Boise, ID 83714
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CTC Telecom, Inc.
Cynthia A. Melillo
Cynthia A. Melillo PLLC
8385 W. Emerald Street
Boise, ID 83704
CTC Telecom, Inc.
Richard Wiggins
P.O. Box 88
130 Superior Street
Cambridge, ID 83610
Michelle Motzkus
Legal & Reg Admin
Millennium Networks LLC
P.O. Box 226
Freedom, WY 83120
Claire Sharp
Deputy Attorney General
Idaho Public Utilities Commission
P.O. Box 83720
Boise, ID 83720
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_________________________________________
Elizabeth A. Koeckeritz