HomeMy WebLinkAbout20240131Final_Order_No_36077.pdfORDER NO. 36077 1
Office of the Secretary
Service Date
January 31, 2024
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF MILLENIUM
NETWORKS, LLC’S NOTICE OF THE
ACQUISITION OF CERTAIN ASSETS OF
CTC TELECOM, INC.
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CASE NOS. MNL-T-23-01
CTL-T-23-03
ORDER NO. 36077
On May 26, 2023, CTC Telecom, Inc. (“CTC”) applied to amend Certificate of Public
Convenience and Necessity (“CPCN”) No. 348, seeking to relinquish the right to provide voice
and broadband services to residential customers in Ada County, Idaho (“Ada County”). Case No.
CTL-T-23-02 (Application at 2).1 In support of CTC’s application, Millenium Networks, LLC
(“Millenium”) filed a notice of acquisition of “substantially all” of CTC’s assets in Ada County in
Case No. MLN-T-23-01. Case No. MLN-T-23-01 (Notice of Acquisition at 1). Millenium
represented that it entered into an agreement on April 19, 2023, to acquire almost all of CTC’s
assets within Ada County (the “Transaction”). Millenium further represented that it intended to
offer local exchange services in and around Ada County, which it is already authorized to do under
CPCN No. 494. In response to Millenium’s Notice of Acquisition, Commission Staff (“Staff”)
recommended the Commission open a new case for CTC to review the asset transfer for
compliance with Idaho Code § 61-328 and previous Commission orders.
On July 12, 2023, the Commission opened a new case for CTC, provided Notice of the
Petition, established a July 27, 2023, public comment deadline and an August 4, 2023, Company
reply deadline. Order No. 35852. Subsequently, the Companies independently reached out to
Staff’s Counsel and asked for additional time to respond to the discovery propounded by Staff.
Additionally, CTC expressed concerns about the relevance of the information requested and
wished to discuss those concerns with Staff.
On July 27, 2023, Staff filed its comments, which were intended as interim comments
because discovery had not been completed.
On July 31, 2023, Staff, Counsel for Staff, Millennium, and CTC discussed Staff’s
discovery requests and the Companies’ concerns. Staff’s Counsel conferred with the Companies
1 Despite intending to withdraw voice and broadband services, CTC represented that it is providing “fixed wireless
services” in Ada County under the assumed name “Wilderness Wireless” and does not seek removal of the right to
provide that service in Ada County from the CPCN. Case No. CTL-T-23-02 (Application at 2).
ORDER NO. 36077 2
and proposed establishing new, supplemental comment and reply deadlines, to allow Staff to
consider the Companies’ anticipated discovery responses in this case.
On August 1, 2023, Staff presented a Decision Memorandum to the Commission
explaining the need to modify comment and reply deadlines in this case. The Commission granted
Staff’s request to establish supplemental public comment and new Company reply deadlines.
On August 2, 2023, the Companies filed their responses to Staff interim comments. In
their responses, they objected to Staff’s discovery requests on the ground that no provision in the
Idaho Code provides the Commission with the authority to review asset transfers between
telecommunication companies.
On August 9, 2023, the Commission issued a Notice of Supplemental Comment
Deadlines establishing a supplemental public comment deadline of August 21, 2023, and a new
Company reply deadline of August 28, 2023. Order No. 35879.
On August 21, 2023, Staff filed supplemental comments, identifying the legal authority
allegedly authorizing an inquiry into the asset transfer. The Companies replied, contesting the legal
basis Staff identified and again requesting dismissal of their respective cases inquiring into the
asset transfer.
With this Order, we dismiss both Case Nos. MNL-T-23-01and CTL-T-23-03 and direct
CTC and Millenium to take further action as outlined below.
STAFF’S INITIAL COMMENTS
Staff reviewed Millenium’s Notice of Acquisition and believed additional information
was necessary to evaluate whether the Transaction satisfies Idaho Code § 61-328 and complies
with previous Commission orders. Staff noted that it had sent—but had yet to receive responses
to—production requests seeking information on the Transaction, and it could not assess the
Transaction without the requested information. Consequently, Staff requested that the Commission
provide the Companies additional time to respond to the production requests.
COMPANIES’ INITIAL REPLY
Despite providing some limited responses, the Companies generally objected to Staff’s
requests for production, arguing that Idaho Code § 61-328 does not apply to transactions involving
telephone corporations. Accordingly, both Companies requested dismissal of their respective cases
reviewing the Transaction.
STAFF’S SUPPLEMENTAL COMMENTS
ORDER NO. 36077 3
Staff responded to the Companies’ argument that the Commission lacked authority to
investigate the Transaction by identifying other legal authorities that authorize an investigation
into the Transaction. Staff noted that the Commission has authority to supervise and regulate public
utilities in Idaho, and that the Companies are public utilities under Idaho Code § 61-121.
Accordingly, Staff asserted that the Commission has jurisdiction over the Companies’ business
conduct. Despite acknowledging that the Commission lacks authority to regulate the rates of
Competitive Local Exchange (“CLEC”) under Idaho Code § 62-622, Staff observed that the
Commission may determine non-economic requirements for all telephone corporations providing
basic local services, including service quality standards, filing of price lists, customer notice, and
customer relations rules. Likewise, Staff noted the Commission may resolve disputes between
telephone corporations and investigate and resolve customer complaints. See Idaho Code §§ 62-
609(3), -616. Staff cited the preceding legal authority as the basis upon which the Commission
granted the Companies’ CPCNs and designated CTC an Eligible Telecommunications Carrier
(“ETC”).
Staff further observed that, to obtain a CPCN or ETC designation, Idaho Code § 61-
528 and Order Nos. 26665 and 35126 require the submission of financial information that
establishes the utility has adequate resources to provide the proposed services. Staff asserted that,
although the Companies provided the necessary information when applying for a CPCN or ETC
designation, the Transaction and resultant change in the Companies’ provision of services in Ada
County constitute material changes that required Staff review to update records, verify compliance
with CPCN and ETC requirements, and to address public interest issues.
Regarding the application of Idaho Code § 61-328, Staff acknowledged the
Companies’ argument that the statute is inapplicable to telephone corporations. Nevertheless, Staff
noted that it generally uses the statute as a guide when evaluating asset transfers between non-
electric public utilities. See Order No. 34416 (stating that the Commission “has an established
practice of evaluating the transfer of water systems under the criteria found in Idaho Code § 61-
328”). Accordingly, Staff asserted the Commission has authority to review the Transaction and
the Companies’ refusal to adequately respond to production requests hinders that review.
COMPANIES’ REPLY TO STAFF’S SUPPLEMENTAL COMMENTS
ORDER NO. 36077 4
The Companies again each asserted that the cases opened to review the asset transfer
between them should be dismissed because the Commission lacks legal authority to conduct such
a review. Despite acknowledging the Commission’s authority to regulate public utilities in Idaho
under Idaho Code §§ 61-121, -501 the Companies contend that they are CLECs exempt from
regulation under Title 61 of the Idaho Code. In support of this contention, the Companies note that
the Telecommunications Act of 1988 (Idaho Code § 62-601, et. Seq) created a category of
telephone corporations not subject to regulation under Title 61. Without citing specific supporting
legal authority, both companies assert that they fall within this category of telephone corporations.
Idaho Code § 62-604, governs the application of the Telecommunications Act and
provides, in pertinent part:
Any telephone corporation, except any mutual nonprofit or cooperative telephone
corporation, which did not, on January 1, 1988, hold a [CPCN] issued by the
commission and, which does not provide basic local exchange service, shall, on and
after the effective date of this act, be subject to the provisions of this chapter and
shall be exempt from the provisions of title 61, Idaho Code.
Idaho Code § 62-604(1)(a). According to a plain reading of this statutory text, a telephone
corporation created after January 1, 1988, is exempt from Title 61 only if it does not provide basic
local exchange services. Consequently, if CTC or Millenium is providing basic local exchange
service, they would not be exempt from Title 61. Notably, both companies hold a CPCN (a
requirement under Title 61 but not the Telecommunications Act) that authorizes the provision of
basic local exchange services.
The Companies asserted that possessing a CPCN does not subject them to
comprehensive regulation under Title 61 and that, if it did, the Telecommunications Act would be
meaningless. Additionally, CTC asserted that the information Staff seeks related to the Transaction
is unlikely to result in further lawful action by the Commission. In support of this argument, CTC
states that its request to remove territory from its CPCN can be granted regardless of its financial
condition. Nor does it have to meet any service quality standards for territory it is no longer
serving. According to CTC, the Commission lacks the authority to unwind the Transaction, nor
can it force CTC to continue providing services. Thus, in CTC’s view, if the Commission did find
that it lacked the financial ability to provide service because of the Transaction or that the
Transaction was not in the public interest, the only option available to the Commission would be
to remove the territory affected by the Transaction from its CPCN.
ORDER NO. 36077 5
COMMISSION FINDINGS
The Commission has jurisdiction over the issues in this case under Title 61 of the Idaho
Code including, Idaho Code §§ 61-501, 502, and -503. Based on our review of the record, we find
it reasonable to dismiss the cases opened to review the asset transfer between CTC and Millenium,
CTL-T-23-03 and MNL-T-23-01 respectively.
These cases were opened for the purpose of reviewing the Transaction for compliance
with Idaho Code § 61-328. No provision of Idaho Code § 61-328 authorizes commission review
of asset transfers between telecommunication companies. Accordingly, we find it reasonable to
dismiss CTL-T-23-03 and MNL-T-23-01, which were both opened to review the asset transfer
between CTC and Millenium.
However, our decision to dismiss these cases does not conclude our analysis. Both CTC
and Millenium have a CPCN, and CTC is designated an ETC. See Order Nos. 28059 (granting
CPCN No. 348 to CTC); 30867 (granting ETC designation to CTC); 31027 (granting Millenium
CPCN No. 494). To obtain a CPCN or ETC designation, telecommunication companies must
submit financial information sufficient to establish that they have financial resources to provide
the proposed services. See Idaho Code § 61-528; Order Nos. 26665 and 35126. Additionally, the
Commission has the authority to rescind an order granting a CPCN or ETC designation if the
telecommunications company no longer satisfies the criteria to obtain them. See Idaho Code § 61-
624.
Based upon Millenium’s representation that it acquired “substantially all” of CTC’s
assets in Ada County and the Companies’ responses to Staff’s production request in these cases,
we find that it is prudent to review whether Millenium still satisfies the requirements to hold CPCN
No. 494 in a separate case. Similarly, we find sufficient reason to question whether CTC still
satisfies the requirements to hold CPCN No. 348 and ETC designation and to warrant investigation
of those issues in a separate case. Accordingly, we find it reasonable to direct CTC and Millenium
to each file a separate petition and supporting evidence demonstrating they still satisfy the criteria
for a CPCN. Additionally, we find it reasonable to direct CTC to include with its petition evidence
that it still satisfies the criteria for ETC designation.
ORDER
IT IS HEREBY ORDERED that Case Nos. CTL-T-23-03 and MNL-T-23-01 are
dismissed.
ORDER NO. 36077 6
IT IS FURTHER ORDERED that CTC Telecom, Inc. and Millenium Networks, LLC
each file a separate petition and supporting materials demonstrating they still satisfy the criteria
for a CPCN. Further, CTC Telecom, Inc. shall include with its petition evidence that it still satisfies
the criteria for ETC designation.
THIS IS A FINAL ORDER. Any person interested in this order (or in issues finally
decided by this order) may petition for reconsideration within twenty-one (21) days of the service
date of this order with regard to any matter decided in this order. Within seven (7) days after any
person has petitioned for reconsideration, any other person may cross-petition for reconsideration.
See Idaho Code §§ 61-626 and 62-619.
DONE by Order of the Idaho Public Utilities Commission at Boise, Idaho this 31st
day of January 2024.
______________________________________
ERIC ANDERSON, PRESIDENT
_______________________________________
JOHN R. HAMMOND, JR., COMMISSIONER
_______________________________________
EDWARD LODGE, COMMISSIONER
ATTEST:
Monica Barrios-Sanchez
Commission Secretary
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