HomeMy WebLinkAbout19990630.docDECISION MEMORANDUM
TO: COMMISSIONER HANSEN
COMMISSIONER SMITH
COMMISSIONER KJELLANDER
MYRNA WALTERS
RON LAW
TONYA CLARK
STEPHANIE MILLER
LYNN ANDERSON
JOE CUSICK
RANDY LOBB
CAROLEE HALL
TERRI CARLOCK
ALYSON ANDERSON
DAVID SCOTT
WORKING FILE
FROM: DON HOWELL
DATE: JUNE 30, 1999
RE: U S WEST’S REQUEST TO RECOVER ITS CAPITAL COST FOR IMPLEMENTING THE EASTERN IDAHO LOCAL CALLING AREA
CASE NO. USW-T-99-9
On May 21, 1999, U S WEST Communications filed a request seeking recovery of its one-time capital costs associated with providing extended area service (EAS) in eastern Idaho. More specifically, the Company seeks to recover $145,968 for implementing EAS between the U S WEST eastern Idaho calling region and the Fremont Telephone exchanges of Ashton, Island Park, and St. Anthony.
BACKGROUND
In Order No. 26672 issued November 1, 1996, the Commission authorized U S WEST to implement three regional calling areas in its southern Idaho service territory. In implementing these regional calling areas, the Commission authorized U S WEST to recover its necessary capital investments for network facilities or improvements to implement EAS from funds remaining in the revenue sharing plan. Order Nos. 26672 and 27100. In Order No. 27633, the Commission reaffirmed its prior decision authorizing U S WEST to recover its reasonable and prudent capital investments for implementing EAS from the remaining revenue sharing funds.
THE APPLICATION
U S WEST has calculated that the construction jobs and capital costs necessary to implement EAS between the eastern Idaho calling region and the Fremont exchanges total $145,968. As part of its Application, the Company has supplied spreadsheets identifying allocated costs associated with these EAS projects. In addition, the Company has also outlined its procedures for segregating the costs associated with implementing EAS. U S WEST observed that reimbursing the Company for its capital costs results in no additional capital costs being included in Title 61 rate base because the installed plant is “fully expensed.” The Company noted that its original estimate for capital expenditures in this matter was approximately $120,000.
STAFF ANALYSIS
The Staff has reviewed the Company’s Application and believes that U S WEST’s request is reasonable. The Company seeks reimbursements for its capital costs associated with implementing EAS in a manner consistent with prior Commission Orders. U S WEST calculated its EAS capital costs as a percentage or portion of upgrading its facilities to accommodate increased EAS local traffic. Staff believes that such calculation is reasonable based upon the specific facts of this case but suggests the in that future the Company provide better tracking data and the underlying bases for its allocation assumptions. After reimbursing U S WEST its current request, there is approximately $4.2 million remaining in revenue sharing funds.
COMMISSION DECISION
Does the Commission adopt the Staff’s recommendation that the USF Administrator be directed to reimburse the Company $145,968 for its eastern Idaho capital EAS costs?
Donald L. Howell, II
Deputy Attorney General
bls/M:uswt999_dh
The revenue sharing plan was a multi-year program, which was terminated in 1996. See Order No. 26355 at 1-3. At the termination of the revenue sharing program, there was a balance in ratepayer sharing funds of approximately $7 million. In Order No. 27100, the Commission authorized U S WEST to use remaining revenue sharing funds to defray its capital costs in implementing EAS between its own exchanges or among EAS routes with other local exchange companies. At the time, the Commission anticipated that the remaining sharing funds would be depleted through the process of implementing EAS. The remaining sharing funds were deposited with the Commission’s Universal Service Fund (USF) Administrator. Order No. 27100 at 53. In this matter, U S WEST requests that the Commission direct its USF Administrator to reimburse the Company for its EAS capital costs.
DECISION MEMORANDUM 3