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Home My WebLink About20030827Reply to Staff's Response to Reopen.pdf, (. :. i Ii C f! , " l- L.I Mary S. Hobson (ISB #2142) Stoel Rives LLP 101 South Capitol Boulevard - Suite 1900 Boise, ID 83702 Telephone: (208) 389-9000 Facsimile: (208) 389-9040 msho bson(ip,stoel. com . ~ 20Q3.J~25 PH 4:51 . , .. , .~ '. _. " Ul iLii :LS COi'JiiiSSION Adam L. Sherr (WSBA #25291) Qwest 1600 7th Avenue - Room 3206 Seattle, W A 98191 Telephone: (206) 398-2507 Facsimile: (206) 343-4040 asherr(ip,qwestcom Attorneys for Qwest Corporation BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION IN THE MATTER OF THE APPLICATION OF QWEST CORPORATION FOR PRICE DEREGULATION OF BASIC LOCAL EXCHANGE SERVICES Case No. QWE-O2- QWEST CORPORATION'S REPLY TO STAFF'S RESPONSE TO QWEST' MOTION TO RE-OPEN THE RECORD Qwest Corporation ("Qwest"), by and through its undersigned counsel, files this Reply to Staffs Response to Qwest Corporation s Motion to Reopen the Record ("Staffs Response filed August 22, 2003. Qwest's Motion to Reopen the Record seeks Commission leave to file the supplemental testimony of James M. Schmit, which describes a proposal that the Commission approve Qwest's application in the form of a provisional Pilot Project. Staff's Response misconstrues the record and, consequently, Qwest's proposal.Further, Staffs Response impugns Qwest's motives in offering its proposal and seeks to deny the Commission the opportunity to evaluate a proposal that will minimize the perceived risks for customers, while still granting Qwest the flexibility it needs to compete in the marketplace. QWEST CORPORATION'S REPLY TO STAFF'S RESPONSE TO QWEST'S MOTION TO RE-OPEN THE RECORD - Page Boise-161077.10029164-00004 THE RECORD IS ENTIRELY CONSISTENT WITH DEREGULATING BASIC LOCAL EXCHANGE SERVICES UNDER THE PROPOSED PILOT PROJECT Although Staff s Response purports to address the procedural question whether the record should be reopened to permit the filing of Mr. Schmit's testimony, much of it is devoted to making one last attempt to convince the Commission that the overwhelming and unrefuted evidence of "effective competition" from wireless providers simply does not exist Hence, Staff repeatedly references "evidence (thatJdoes not meet the statutory standard"l and "the absence of real evidence.,,2 By ignoring the record evidence and pretending that its unsupportable interpretations of the Idaho statutes have been upheld, Staff feels free to mischaracterize Qwest's proposal as an attempt to "address the deficiencies in its case.,,3 In taking this approach Staff misconstrues Qwest's proposal and its purpose. Qwest's proposal is not offered to "address the shortcomings of its case" as Staff suggests 4 but rather to make clear Qwest's commitment to exercise the regulatory freedoms to which it is entitled under Idaho Code S 62-622(3) in a manner that is entirely consistent with the public interest. Staff, in pursuit of its decision to "oppose(J Qwest's Application from the very beginning"S appears to have lost sight of what matters of public interest are actually at stake in this proceeding. As a result, Staff states , " it is incorrect to say that Staff s primary concern is that competition will not adequately constrain Qwest's pricing."6 While this may be true, it is an admission that Staff is unconcerned about the ultimate question of public interest raised by this case. Section 62-622(3) poses only one question: has competition become sufficiently effective" to replace Commission price regulation? Qwest's literally unchallenged evidence7 is that competition from wireless companies will constrain competition and therefore replace Commission regulation. Qwest's proposal, which limits Qwest's pricing freedom and subjects the company to potential Commission "claw-back " goes to the very heart of the case and demonstrates Qwest's Staff's Response , p. Id. at Id. at Id. at Id. a. Id. See e.g, Tr. , 99 168 270 271, 540. QWEST CORPORATION'S REPLY TO STAFF'S RESPONSE TO QWEST'S MOTION TO RE-OPEN THE RECORD - Page 2 Boise-1610nI0029164-00004 conviction that effective competition prevails in its seven largest exchanges. Rather than being prompted by "awareness that its evidence does not meet the statutory standard ,g Qwest's proposal is grounded in the awareness that competition is so effective that Qwest cannot expect to increase prices significantly over the foreseeable future. It is also based on the conviction that the Commission will not find that the manner in which Qwest will proceed under the freedoms accorded by section 62-622(3) raises public interest concerns that justify exercise of "claw- back." Staffs Response is correct that Mr. Schmit's testimony is not directed at meeting the requirements of section 62-622(3). The evidence demonstrating Qwest's compliance with Idaho statute is already in the record. The purpose of Qwest's proposal is offer customers and the Commission added assurance that granting Qwest's application will be in the public interest. THE COMMISSION'S PROCEDURAL RULES DO NOT PRECLUDE REOPENING THE RECORD Staffs Response attempts to create the impression that reopening the record to allow submission of Mr. Schmit's supplemental testimony somehow violates the Commission procedures. Staff is incorrect. Staff fails to cite any Commission rule or precedent that supports the position that Qwest is precluded from supplementing the record prior to the Commission s rendering a final decision. Instead, Staff argues that because Qwest's Application requested broader relief than is now being sought under the Pilot Project, the Commission cannot consider the Pilot Project proposal. its face, this argument is illogical. If Qwest's original Application was sufficient to invoke the Commission s jurisdiction to grant unfettered price deregulation, it must certainly be adequate to invoke jurisdiction for consideration of the more narrow issue of Qwest's voluntary offer to exercise the pricing freedoms provided under section 62-622(3) under the terms contained in the supplemental testimony. Rather than being "inconsistent" with Qwest's Application, the proposal merely limits the potential impact of price deregulation on customers while increasing the Commission s ability to exercise oversight of Qwest as it operates in the competitive market. Moreover, as Qwest made clear in its Motion, Qwest is not trying to prevent the parties from having the opportunity to comment on the Pilot Project. In fact, the Motion specifically Id. at Staff erroneously suggests that Qwest is seeking "to broaden the issues.!d. at QWEST CORPORATION'S REPLY TO STAFF'S RESPONSE TO QWEST'S MOTION TO RE-OPEN THE RECORD - Page 3 Boise-I 61077.1 0029164-00004 stated that "Qwest will agree with any reasonable procedure to allow the parties to understand this proposal and to voice their views."lo Staff did not comment on this aspect of Qwest' Motion. Instead, Staff tries to convince the Commission that Qwest has failed to meet some standard of justification for reopening the record. Contrary to Staff s suggestion, however, the Commission s rules do not require that a party seeking to supplement the record meet the judicial standard for provision of a new trial. 11 Obviously such a standard would not be appropriate because supplementing the record is not remotely similar to seeking a new trial. Qwest is not asking that the Commission disregard the previous record. Instead of attempting to borrow from judicial rules that have no bearing on the procedural issue presented here, the Commission will find better guidance in Rule 13 of the Commission Rules of Practice and Procedure: These rules will be liberally construed to secure just, speedy and economical determination of all issues presented to the Commission. Unless prohibited by statute, the Commission may permit deviation from these rules when it finds compliance with them is impracticable, unnecessary or not in the public interest. Qwest respectfully submits that granting its Motion secures the 'just, speedy and economical" determination of the "issues presented to the Commission.This is because the issue here is not simply whether Qwest's original application will be granted or denied, but rather how Qwest will operate in the increasingly competitive basic local exchange markets in which it does business. Denying Qwest's Application , as Staff advocates, will not determine that central issue-it will merely delay determination and force Qwest, the Commission and interested parties to take it up again in another docket. Although granting Qwest's Motion to Reopen the Record does not assure that such a result will be avoided, it offers the Commission and the parties the opportunity to assess a proposal that, Qwest believes, resolves the ultimate issue while minimizing the perceived risks for customers and for the Commission. Qwest is unaware of any Commission rule or precedent that justifies narrowing the range of possible solutions to a difficult case or cutting off potentially fruitful discussion, simply Qwest s Motion to Reopen the Record , p. Staff's Response , p. IDAPA 31.01.01.013. QWEST CORPORATION'S REPLY TO STAFF'S RESPONSE TO QWEST'S MOTION TO RE-OPEN THE RECORD - Page 4 Boise-161077.1 0029164-00004 because the record has been "closed." In addition, since the "status quo" of Commission price regulation is maintained while the discussion continues, it is not surprising that Staff has failed to cite a single public interest justification for opposing Qwest's Motion. Qwest respectfully requests that the Commission grant its Motion to Reopen the Record to allow a discussion of the proposed Pilot Project. Submitted this 26th day of August, 2003. Qwest Corporation A '((;;/h Mary S. Ho Stoel Rives LLP Adam L. Sherr Qwest Attorneys for Qwest Corporation QWEST CORPORATION'S REPLY TO STAFF'S RESPONSE TO QWEST'S MOTION TO RE-OPEN THE RECORD - Page 5 Boise-161O77.10029164-00004 CERTIFICATE OF SERVICE I hereby certify that on this 26th day of August, 2003, I served the foregoing QWEST CORPORATION'S REPLY TO STAFF'S RESPONSE TO QWEST'S MOTION TO RE- OPEN THE RECORD upon all parties of record in this matter as follows: Jean Jewell, Secretary Idaho Public Utilities Commission 472 West Washington Street Boise, ill 83720-0074 Phone: (208) 334-0300 Fax: (208) 334-3762 i i ewellvp,puc. state.id. us Weldon Stutzman, Deputy Attorney General Idaho Public Utilities Commission 472 West Washington Street O. Box 83720 Boise, ill 83702 Telephone: (208) 334-0300 Facsimile: (208) 334-3762 W stutzmc(V,puc.state.id. us Executed protective agreement Marlin D. Ard Willard L. Forsyth Hershner, Hunter, Andrews, Neill & Smith LLP 180 East II th Avenue O. Box 1475 Eugene, OR 97440-1475 Attorneys for Verizon Executed protective agreement John Gannon, Esq. 1101 West River - Suite 110 Boise, ill 83702 Telephone: (208) 433-0629 Attorney for Meierotto, Padget, Herrick Neal ---..L Hand Delivery U. S. Mail Overnight Delivery Facsimile Email Hand Delivery U. S. Mail Overnight Delivery Facsimile Email Hand Delivery U. S. Mail Overnight Delivery Facsimile Email ---..L Hand Delivery U. S. Mail Overnight Delivery Facsimile Email QWEST CORPORATION'S REPLY TO STAFF'S RESPONSE TO QWEST'S MOTION TO RE-OPEN THE RECORD - Page 6 Boise-161O77.1 0029164-00004 Dean J. Miller McDevitt & Miller LLP 420 West Bannock Street O. Box 2565 Boise, ill 83701 Telephone: (208) 343-7500 Facsimile: (208) 336-6912 i oe~mcdevitt -miller. com Attorneys for World Com, Inc. Attorneys for AT&T Attorneys for Time Warner Telecom Executed protective agreement Hand Delivery U. S. Mail Overnight Delivery Facsimile Email Dean Randall Verizon Northwest Inc. 17933 NW Evergreen Parkway Beaverton, OR 97006-7438 dean.randal1~verizon. com Executed protective agreement Hand Delivery U. S. Mail Overnight Delivery Facsimile Email Mary Jane Rasher 10005 South Gwendelyn Lane Highlands Ranch, CO 80129-6217 Telephone: (303) 470-3412 mirasherc(V,msn.com Hand Delivery U. S. Mail Overnight Delivery Facsimile Email Adam Sherr Qwest 1600 7th Avenue - Room 3206 Seattle, W A 98191 Telephone: (206) 398-2507 Facsimile: (206) 343-4040 asherr~qwest.com Hand Delivery U. S. Mail Overnight Delivery Facsimile Email Clay R. Sturgis Moss Adams LLP 601 West Riverside - Suite 1800 Spokane, WA 99201-0663 Hand Delivery ---..L U. S. Mail Overnight Delivery Facsimile Email Brian Thomas TimeWarner Telecom 223 Taylor Avenue North Seattle, W A 98109 Brian. Thornasc(V,twtelecom.com Hand Delivery ---..L U. S. Mail Overnight Delivery Facsimile Email QWEST CORPORATION'S REPLY TO STAFF'S RESPONSE TO QWEST'S MOTION TO RE-OPEN THE RECORD - Page 7 Boise-161O77.1 0029164-00004 Susan Travis World Com, Inc. 707 I ih Street - Suite 4200 Denver, CO 80202 Telephone: (303) 390-6333 Susan.a. Travisc(V,worldcom.com Conley E. Ward, Jr. Givens Pursley LLP 277 North 6th Street - Suite 200 O. Box 2720 Boise, ill 83701-2720 Telephone: (208) 388-1200 Facsimile: (208) 388-1300 cew~givenspursley.com Attorneys for Idaho Telephone Association Executed protective agreement Hand Delivery U. S. Mail Overnight Delivery Facsimile Email Hand Delivery ---..L U. S. Mail Overnight Delivery Facsimile Email ~4/ ~41L'. Brandi L. Gearhart, P S Legal Secretary to Mary S. Hobson Stoel Rives LLP QWEST CORPORATION'S REPLY TO STAFF'S RESPONSE TO QWEST'S MOTION TO RE-OPEN THE RECORD - Page 8 Boise-161077.1 0029164-00004