20100316Petition for Reconsideration.pdf

John R. Hammond, Jr., ISB No. 5470
Batt Fisher Pusch & Alderman LLP
U.S. Ban Plaza, 5th Floor
101 S. Capitol Boulevard, Suite 500
Post Office Box 1308
Boise, ID 83701
Telephone: [phone]
Facsimile: [phone]
i"~"t.-
to'O t\ÀR \ 6 P"'\ 4: 02
Attorney for Time Warner Cable
Information Services (Idaho), LLC
Before the
IDAHO PUBLIC UTILITIES COMMISSION
Application of )
)
TIME WARER CABLE INFORMATION ) Case No. TIM-T-08-01
SERVICES (IDAHO), LLC )
)
For a Certificate of Public Convenience and ) PETITION FOR RECONSIDERATION
Necessity to Provide Competitive Facilities- )
Based Local and Interexchange )
Telecommunications Services within the )StateofIdaho )
Pursuant to Idaho Code § 61-626 and Commission Rule of Procedure 331, Time Warer
Cable Information Services (Idaho), LLC, d//a Time Warer Cable ("TWCIS"), by and through
its attorneys, submits this petition for reconsideration of the order adopted by the Commission on
Februar 23,2010 in the above-captioned proceeding (the "Order"). The Order denied TWCIS's
application for a certificate of public convenience and necessity ("CPCN") to provide statewide,
competitive facilties-based local and interexchange telecommunications services within the
State of Idaho. i
TWCIS's Application was submitted on November 14,2008. A Supplement to the
Application was submitted on November 9,2009.
ORIGINAL
The Commission should reconsider the Order because it is uneasonable, unlawfl,
erroneous, unduly discriminatory and not in conformance with the facts of record and applicable
law. As explained herein, the Order rests on the erroneous conclusions that: (i) TWCIS has not
satisfied the cumulative requirements for issuance of a CPCN under Title 61 (presumably based
on the Staffs incorrect finding that TWCIS wil not offer "basic local exchange services," and
thus is not a "telephone corporation" under Title 61 of the Idaho Code); and (ii) Title 62 of the
Idaho Code thus forecloses the Commission from granting a CPCN to TWCIS.
In fact, the record demonstrates that TWCIS has met the requirements necessar to obtain
a CPCN from the Commission, as set forth in the Idaho Code and the Commission's Rules and
Orders. In particular, TWCIS is a "telephone corporation" under Idaho law, and wil offer "basic
local exchange services," as that term is defined in Idaho Code § 62-603(1). Therefore, TWCIS
is entitled to the sae treatment that the Commission has afforded similarly situated carers in
granting their CPCN applications. Furher, while Title 62 exempts TWCIS from certain
requirements under Title 61, nothing in Title 62 forecloses the Commission from allowing
TWCIS to take advantage of benefits otherwise available to it under Titles 61 and 62. In fact,
federal and state law and policy obligate the Commission to permit TWCIS to properly exercise
such rights. Accordingly, the Commission should reconsider its findings in the Order and grant
TWCIS's Application in an expeditious maner.
2
I.
STANDARDS FOR RECONSIDERATION
Reconsideration allows a par to bring to the Commission's attention any issue
previously determined, and thereby provides the Commission with an opportunity to rectify any
mistake or omission.2 In those instances where an aggrieved pary asks the Commission to
reconsider its decision based upon the record, it may simply do so. The Commission may also
grant reconsideration by rehearing if it intends to take additional evidence or argument. If
reconsideration is granted, the Commission must complete its reconsideration within thrteen
weeks after the date for fiing petitions for reconsideration.3 Ifthe Commission grants
reconsideration, it "must issue its order upon reconsideration within twenty-eight(28) days after
the matter is finally submitted for reconsideration. ,,4
II.
ARGUMENT
'Á. The Commission's,Decision to Deny TWCIS a CPCNis Unduly
Discriminatory
As TWCIS has noted previously, the Commission recently granted CPCNs to carers
that proposed to offer services comparable to those proposed by TWCIS, and there is no
justification for taking a different approach in this case. For example, in its application for a
CPCN, ALEC Telecom, Inc. ("ALEC") proposed to "provide facilities-based and resold local
exchange and interexchange services to the extent the network and transmission facilities of its
2 Washington Water Power Co. v. Kootenai Environmental Allance, 99 Idaho 875, 591
P.2d 122 (1979).
Idaho Code § 61-626(2).
Id.
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4
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facilities-based competitive suppliers permit."s In paricular, ALEC represented that it would
offer "wholesale switching and interconnection services to other telephone service providers and
similarly-positioned wholesale business customers," and that in the future it might provide
services that fell within the category of "basic local exchange service. ,,6 The Staff supported,
and the Commission granted, ALEC's request for a CPCN.
Similarly, in its application for a CPCN, Eltopia Communications, LLC("Eltopia")
represented that it would be primarily providing high-speed data services and IP protocol-
conversion that did not require certification.7 Yet, the Sta supported, and the Commission
granted, Eltopia's application afer noting that Eltopia had the capability to provide both voice
and data services over the same tru and recognizing the company's desire to maintain the
flexibility to configure its service according to its customer's specifications.8
TWCIS's wholesale interconnection services justify grant of a CPCN based on these
decisions. The Commission does not contest TWCIS's analysis" oii this point, and does nothing'
to distinguisli,in any way these applications from thatsubmittedtby TWCiS.9 Thus, based on
these past cases, the Commission should grant TWCIS a CPCN subject to similar terms and
conditions. Accordingly, the Commission's sumar conclusion that the services that TWCIS
proposes to offer do not meet the statutory definition of "basic local exchange services" is
5 See Application of ALEC Telecom, Inc. for a Certifcate of Public Convenience and
Necessity to Provide Local Exchange and Telecommunications Services, Case No. ALE-
T -09-01, Order No. 30944 (Nov. 13, 2009).
Id. at 4-5
Application of Eltopia Communications LLC for a Certifcate of Public Convenience and
Necessity to Provide Local Exchange and Telecommunications Services, Case No. ECL-
T-07-01, Order No. 30442 (Sep. 24, 2007).
Id.
6
7
8
9 See Citizens Utilties Company v. Idaho Public Utilties Commission, Idaho, 739 P. 2d
1061, 1063,360,363 (1987).
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arbitrar and capricious (as is the conclusion, discussed below, that Idaho Code § 62-604 does
not allow for TWCIS to obtain a CPCN), and should be abandoned. Simply put, such blatant
discrimination against TWCIS canot be justified and should not be allowed to stad by the
Commission.
B. The Order Erroneously Concludes that TWCIS Fails to Satisfy the
Cumulative Requirements for a CPCN
Even apar from the Commission's disregard for such precedent, the Order is erroneous.
In the Order, the Commission finds that TWCIS's fiing does not satisfy "the cumulative
requirements for the issuance of a CPCN . . . ."10 The Commission does not clearly explain the
basis for this finding, and neither the Commission nor the Staff disputes that TWCIS has
satisfied the conditions for grant of a CPCN set fort in the Commission's Rules and Order No.
26665.11 However, the Commission does appear to agree with the Staff s conclusion that
TWCISwill not offer "basic local exchange services," and that TWCIS therefore canot be
deemed a "telephone corporation" to which a CPCN may be granted under Title 61. of the Idaho'
t,'".- ,',",".
Code.
12
There is no basis for this finding, however, as TWCIS's services do satisfy the definition
of "basic local exchange services.,,13 Contrar to the Staffs position, TWCIS is "telephone
corporation" that wil provide ''telecommuncations services" in the State of Idaho. 14 Idaho Code
§ 61-121(1) defines a "telephone corporation" as "every corporation or person, . . . providing
10
Order at 4.
See Staff Comments at 3; Order at 2. Order No. 26665 helped to streamline the process
to obtain a CPCN as outlined by Commission Rule of Procedure 111.
Order at 5.
See Supplement at 4-6.
See Idaho Code § 61-121(1) & (2).
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12
13
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'telecommunications services' for compensation in this state." Idaho Code § 61-121(2) defines
"telecommunication service" as:
(T)he transmission of two-way interactive switched signs, signals, wrting,
images, sounds, messages, data, or other information of any natue by wire, radio,
lightwaves, or other electromagnetic means (which includes message
telecommunication service and access service), which originate and terminate in
this state, and are offred to or for the public, or some portion thereof: for
compensation.
15
TWCIS wil provide statewide, competitive, facilities-based wholesale and retail local
intrastate telecommunications services for compensation within the State ofIdaho.16 Such
services may include point-tooopoint, private line, access and transport services, for which the
Company intends to seekcompensation.17 More specifically, TWCIS's Local Interconnection
Service wil enable two-way interconnection between the facilities of TWCIS's customers and
the public switched telephone network ("PSTN"). This service wil be offered on a wholesale
basis to facilities-based providers of interconnected VoIP services, and will provide for, among
other things, two..way interactive switched voice comiuncations that will be transported and
terminated in Idaho. Local Interconnection Service also wil provide TWCIS's interconnected
VoIP provider customers with access to domestic and international toll services, operator
services, telephone number resources, 911 calling, and related services and features. This
service, in addition to the other services TWCIS intends to offer in Idaho, all fall within the
15 Idaho Code § 61-121(2) (emphasis supplied); see also Idaho Code § 62-603(13). In
specifying that "telecommunications services" must be offeredto or for the public, "or
some portion thereof," this section strongly suggests that the Legislature intended to
include services provided directly to the public as well as those provided to other carriers
and ultimately delivered services to end users. TWCIS is proposing to do both in the
State of Idaho.
See Application at p. 2, 5.
Id.
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statutory definition of "telecommunication service" under the Idaho Code. Accordingly, there
should be no question that the Company is a "telephone corporation" as defined by Idaho law.
Furher, as TWCIS has explained, and contrar to the Staffs assertions, TWCIS's Local
Interconnection Service satisfies the definition of "basic local exchange services.,,18 TWCIS also
may later introduce additional retail telecommunications services in Idaho that also qualify as
"basic.,,19 Therefore, to the extent that the actual provision of basic local exchange service at the
time a CPCN is granted is required under Title 61, TWCIS has satisfied that requirement.
However, as discussed above, it does not appear based on Commission precedent that the actual
provision of "basic local exchange service" is a prerequisite to being granted aCPCN. Rather,
Staff and the Commission have recognized in other CPCN cases that a certificate may be granted
to a carrer that does not yet offer any basic local exchange service.
C. The Order Erroneously Concludes that Competitive Telecommunications
Carriers May.Not Seek aCPCN
As TWCIS has explained, the Commission has broad authority under the Idaho Code to
"do all things necessary to car out the spirit and intent of the provisions of ths act,,,20 including'
taking the actions necessar to ensure that Title 62 does not have the perverse effect of depriving
a carier of the core inputs it requires to provide competitive local exchange service. Thus, while
TWCIS continues to believe that its proposed services are "basic local exchange services" under
Idaho law, and that it is therefore entitled to obtain a CPCN under Title 61, nothing in the Idaho
Code would preclude the grant of a CPCN to TWCIS even if the Commission were to reach a
different conclusion. To the contrar, the Commission should apply Idaho law in a maner that
18 Idaho Code § 62-603(1).
See Application at 4.
Idaho Code § 61-501.
19
20
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advances the strong public policy interests that favor granting TWCIS's application, as
authorizing TWCIS to operate as a CLEC will enable it to bring the benefits of facilities-based
competition and advanced services to Idaho consumers. Indeed, by obtaining certificates from
many other states, TWCIS's affiiates are now benefiting consumers in many 'areas of the
country; there can be no legitimate reason for withholding such authority in Idaho alone.
In the Order, the Commission does not disclaim its broad authority under the Idaho Code,
but does conclude that "the inclusion of conditional language followed by the word 'shall' in
Idaho Code § 62-604 strongly suggests that the legislative intent was to remove any discretion as
to whether a telephone corporation could opt to be governed by Title 61.,,21 Asa result, the
Commission finds that it may not grant TWCIS's Application.22 Respectfully, there are several
critical flaws with this analysis:
By the Commission's own reasoning, Section 62-604 is inapplicable to TWCIS. By its
terms, Idaho Code § 62-604, applies only to the extent that a carer is a ''telephone corporation"
under Idaho law. ,The Staffs analysis, which the Commission appears to adopt, concludes that
TWCIS is not a "telephone corporation.,,23 Accordingly, if TWCIS were not a "telephone
corporation," there would be no basis for using Idaho Code § 62-604 to preclude TWCIS from
seeking a CPCN.
Exemption from Title 61 requirements does not foreclose TWCISfrom taking
advantage of Title 61 benefits. The plain language of Idaho Code § 62-604 provides that
TWCIS "shall be exempt" from the provisions of Title 61. The mere fact that a pary is exempt
from a set of provisions does notforeclose that party from taking advantage of those provisions
21
22
23
Order at 4.
Id.
See Order at 2, 5.
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when it is beneficial to do so. In fact, to "exempt" a pary simply is "to free (that pary) from an
obligation, a duty, or a liability to which others are subject.,,24 Nothing in that definition, or
Idaho Code § 62-604, requires an exempt pary to forego, or precludes the Commission from
facilitating, benefits or advantages otherwise available to similarly situated entities.
As TWCIS has explained, it is not seeking certification for the purose of subjecting
itself to burdensome regulations, but rather is seeking a CPCN because, in its experience,
incumbent LECs will refuse to interconnect with an entity that does not hold a CPCN granted by
the relevant state commission, and TWCIS likewise would be unable to obtain other essential
inputs and assistance from entities that administer numbering and call-routing processes.
TW CIS's ability to interconnect with other carrers is a fundamental requirement of its proposed
business activities, the foreclosure of which would be contrar to the public interest, as well as
federal and state law. Idaho Code § 62-604 does not compel TWCISto forego, or the
,Commission to deny, this vital prerequisite to providing competitive telecommunications
. services.
The Commission ignores the clear legislative intent behind Idaho Code § 62-604. The
Commission attempts to divine the legislative intent behind Idaho Code § 62-604 by analyzing
its structure, yet inexplicably ignores the actual legislative history of this section, and portions of
Title 62 that clearly express the legislature's intent (e.g., Idaho Code § 62-602, "Legislative
Intent"). AsTWCIS explained in its Supplement, the legislative history of Title 62 shows that its
primar purose was to allow certificated, rate-regulated telephone corporations to elect whether
to remain rate regulated for telecommunications services other than basic local exchange service
24 See Exempt, THE AMERICAN HERITAGE DICTIONARY OF THE ENGLISH LANGUAGE (4th Ed.,
retrieved Mar. 9,2010).
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(such as for interLATA services).2s Nothing in that legislative history remotely suggests that
Idaho Code § 62-604 was intended toforeclose competitive cariers from obtaining a CPCN, or
deny such carers the ability to make an election similar to rate-regulated carers generally
subject to far more restrictive regulation. 26
Moreover, Idaho Code § 62-602 clearly establishes thatthe legislatue's intent in
adopting Section 62-604 was to encourage effective competition, and to give the Commission the
authority to empower competitive providers to enter local markets for communications services.
As noted previously by TWCIS, the Commission's interpretation ofIdaho Code § 62-604 would
have precisely the opposite effect-a fact that the Order does nothing to dispute. In light of this
history, the Commission's discussion oflegislative intent is manfestly flawed.
The Commission ignores its independent authority to grant TWCIS a. CPCN under
Title62. The Commission ignores the factthat Title 62 grants it authority that is independent of
whether Title 61 is applicable to a given carer. For example, Idaho Code § 62-615 grants the
Commission "full power and authority to implement the federal telecommunications act of 1996
. . . ." As TWCIS notes, a competitive carier can vindicate its federal rights-including the right
to interconnect with other carriers-only if it first receives a CPCN (a point that the Commission
does not dispute). Thus, Idaho Code § 62-615 affords the Commission clear authority to grant
TWCIS the requested CPCN, notwithstading its interpretation ofIdaho Code § 62-604.
25
See Statement of Purose RS21609CI, Telecommunications Regulatory Reform, H.B.
687 (1988); Statement of Purpose RS 14965, H.B. 224 (2005).
Notably, Idaho Code § 62-604 allows a telephone corporation that held a CPCN prior to
January 1, 1988 to either remain regulated under Title 61 or elect to exclude all, or part of
its telecommuncations services from regulation under that title. Presumably, then, a
telephone corporation could elect to remain regulated under Title 61 even for services
that would not qualify as "basic local exchange service." TWCIS should enjoy a similar
level of flexibility.
26
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For these reasons, the Commission should reconsider the Order, find that it has the
authority to grant TWCIS the requested CPCN, and proceed to do so.
D. The Order Conflcts with Well-Defined Federal Law and Policy, and Would
Be Subject to Preemption if Not Reconsidered
In each of its prior pleadings, TWCIS has noted that denying TWCIS's request for a
CPCN would create a barer to entr in violation of federal law and contrar to clear federal and
state policies in favor of greater intrastate competition. As TWCIS has explained, it is seeking a
CPCN because, in its experience, incumbent LECs will refuse to interconnect with an entity that
does not hold a CPCN granted by the relevant state commission. Furher, the denial of a CPCN
may leave TWCIS without the ability to obtain telephone numbers, route calls, and obtain
whatever other inputs are necessary to operate as a CLEC?7 For instace, when a carer
requests telephone number blocks, that entity's status as a holder of a CPCN is verified by the
numbering authority before number blocks are assigned. Similarly, TWCIS will not be able to
be listed in the Local Exchange Routing Guide, which is essential to routing local calls, without
an Operating Company Number, which is issued by the National Exchange Carer Association
and is only provided to entities that hold CPCNs. A CPCN is required before such an
identification code wil even be issued. Nor wil TWCIS be able to obtain company codes that
identify it and permit it to pay and collect access charges for the traffc it intends to cary or to be
listed in industr databases that are necessar for the provision 'of service to customers.
Providing the local interconnection services that TWCIS intends to offer therefore involves much
more than simply obtaining an interconnection agreement with an incumbent LEC. Without a
27 See, e.g., Telephone Number Requirements for IP-Enabled Services Providers, Report
and Order, 22 FCC Rcd 19531, at ir 12 (2007) (noting thatNANPA "provides numbers
only to entities that are licensed or certificated as carers under the (Federal
Communications) Act.").
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CPCN, TWCISwil not be able to obtain several inputs that are essential to its ability to offer
service.
Neither the Staff nor the Commission itself has ever disputed this point, or that such an
outcome would be contrar to the public interest. Yet, the Commission fails to recognize the
real-world consequences of the Order and the adverse impact that its findings wil have on
TWCISand, ultimately, consumers. In short, the Commission's choice is not between granting
TWCIS a CPCN or allowing it to operate on a deregulated basis without one, but rather between
granting TWCIS a CPCN and impairing its ability to operate at all.
For ths reason, the Order as it stands erects a clear barer to TWCIS's ability to enter the
Idaho market, and as such is subject to preemption under federal law (a point that the
Commission fails to address). As TWCIS noted in its Supplement, a key pilar in Congress's
effort to open local telecommunications markets to competition was its enactment of Section 253
of the Federal Communications Act, which provides that "(n)o State or local statute or regulation
. ..: may prohibit or have the effect of prohibiting the ability of any entity to provide any
interstate or intrastate telecommunications service.,,28 Thus, any interpretation of Titles 61 and
62 of the Idaho Code that would thwar a competitive carier's ability to enter the Idaho market
by interconnecting with incumbent carers would be subject to preemption under Section 253.19
28
29
47 U.S.C. § 253(a).
The FCC has made clear that wholesale telecommunications carrers are entitled to obtain
interconnection to the same degree as retail carriers. See, e.g., Time Warner Cable
Request for Declaratory Ruling that Competitive Local Exchange Carriers may Obtain
Interconnection under Section 251 of the Communications Act of 1934, as Amended, to
Provide Wholesale Telecommunications Services to VoIP Providers, Memorandum
Opinion and Order, 22 FCC Rcd 3513 (WCB 2007). Accordingly, deprivingTWCIS of
that federal right, which is essential to its ability to provide telecommunications services,
would squarely conflct with Section 253.
12
More generally, and even apar from the dictates of Section 253, the strongly pro-competitive
principles of federal and state law counsel against any such reading.3o
In order to ensure consistency between Commission action and federal and state law and
policy, the Commission should reconsider the Order and grant TWCIS the requested CPCN.
CONCLUSION
For the reasons set forth herein, TWCIS is entitled to reconsideration of the Order, and
grant of a CPCN to provide competitive facilities-based local and interexchange
telecommunications services within the State of Idaho.
WHEREFORE, TWCIS respectfully requests that the Commission:
1. Reconsider the order it adopted on Februar 23, 2010 in this proceeding;
2. Process TWCIS's Application by Modified Procedure under the Commission's
Rules of Procedure;
3. Grant TWCIS's request for a CPCN to provide competitive facilities-based loca.l
and interexchange telecammuncations services within th~ State of Idaho; and,
4. Grant such other relief as it deems necessar and appropriate.
Dated this 16th day of March, 2010.
. Hamond, Jr.
isher Pusch & Alderman LLP
torney for Time Warner Cable
Information Services (Idaho), LLC
30 Cf, e.g., United States Telecom Ass'n v. FCC, 359 F.3d 554, 576 (D.C. Cir.2004)
(stating thatthe goal of promoting facilities-based competition must guide the FCC's
implementation of the Communications Act).
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CERTIFICATE OF SERVICE
I HEREBY CERTIFY that on this!& -Iy of March, 2010, a tre and correct copy of
the foregoing document was served on the following individuals by the method indicated below:
Jean Jewell
IDAHO PUBLIC UTILITIES COMMISSION
472 W. Washington St.
PO Box 83720
Boise ID 83720-5983
Neil Price
Deputy Attorney General
IDAHO PUBLIC UTILITIES COMMISSION
472 W. Washington St.
PO Box 83720
Boise ID 83720-5983
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