uswt9921.dhw.doc

DONALD L. HOWELL, II
DEPUTY ATTORNEY GENERAL
IDAHO PUBLIC UTILITIES COMMISSION
PO BOX 83720
BOISE, IDAHO 83720-0074
[phone]
IDAHO BAR NO. 3366

Street Address for Express Mail:
472 W. WASHINGTON
BOISE, IDAHO 83702-5983

Attorney for the Commission Staff

BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION

IN THE MATTER OF THE INVESTIGATION INTO RATE CENTER CONSOLIDATION FOR U S WEST COMMUNICATIONS, INC. IN SOUTHERN IDAHO TO CONSERVE AVAILABLE NXX CODES. )
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CASE NO. USW-T-99-21

REPLY COMMENTS OF THE COMMISSION STAFF

COMES NOW the Staff of the Idaho Public Utilities Commission, by and through its Attorney of record, Donald L. Howell, II, Deputy Attorney General, and in response to Order
No. 28144 and the Notice of Modified Procedure filed September 7, 1999, submits the following reply comments.

BACKGROUND
Rate centers are the geographic locations used by telephone companies for calculating the charges for long distance or toll calls. Historically, there is a rate center associated with each exchange and the local exchange company (LEC) has at least one NXX (the prefix or first three digits in a seven digit telephone number) for each rate center. With competition, it is typically necessary for each new provider or competitor (CLEC) to obtain an NXX for each rate center in the area in which it provides service. A competitor providing service throughout the U S WEST Treasure Valley calling area, would obtain 18 NXX codes. As each NXX has approximately 10,000 numbers, that competitor would essentially be assigned 180,000 numbers, before it has signed up a single customer. As this example demonstrates, Idaho could run out of NXX codes long before running out of numbers. Reducing the number of rate centers reduces the number of NXX codes each new service provider requires to serve an area. This, in turn, prolongs the life of the 208 area code and avoids the expense of adding a second area code for Idaho.
The federal Telecommunications Act of 1996 gave the Federal Communications Commission (FCC) jurisdiction over all aspects of numbering, and the FCC has only delegated to the states a very narrow role dealing with area code exhaust. However, one area of state jurisdiction is the establishment of rate center boundaries and rate center consolidation. This can have a significant impact on prefix or NXX code utilization. Because of the recently approved EAS regions and the relatively slow emergence of competition, Idaho may have a window of opportunity to consolidate rate centers with minimal impact and significantly extend the life of the 208 area code.
To investigate this possibility further the Commission, on September 7, 1999, issued Order No. 28144 which opened a docket to consider the consolidation of rate centers in
U S WEST’s southern Idaho service area. The Commission requested written comments from interested parties, and specifically requested comments regarding: (1) the area of consolidation; (2) the manner of consolidation and any technical concerns; (3) implementation concerns, such as timing, costs, etc.; and (4) potential cost recovery mechanisms, if applicable.
An initial comment deadline was scheduled, followed by an opportunity for reply comments. U S WEST was the only party to file extensive comments in the initial period. (AT&T submitted a letter of general support for the concept, reserving the option of filing additional comments in the reply round.) Staff has reviewed the comments submitted by
U S WEST, and submits the following reply comments.

STAFF ANALYSIS
In its comments, U S WEST indicated it supported rate center consolidation and made specific recommendations as to how such consolidation could proceed. In general, Staff supports U S WEST’s recommendations.
Idaho’s 208 area code is now projected to last until 2006, based upon the 1999 number exhaust survey. While this is an improvement over the 2003 exhaust date determined from the
1998 survey, it is still relatively soon. Approximately two years ago, Staff estimated approximately 300 of the 800 available NXX codes were in use. By July of 1999, an additional 230 codes had been assigned. Almost one half of the remaining codes have been assigned in two years.
As rate centers are used in determining whether a telephone call is a “toll” call, consolidating rate centers typically requires increasing the size of the local calling areas. However, with the creation of the EAS regions in U S WEST South’s service area, this will not be necessary because three large local calling areas already exist.
In addition, with most carriers, including U S WEST, moving towards flat or non-distance based toll rates, larger rate center areas are expected to have no impact on toll charges for most customers. In those few cases where customers use a carrier that still has mileage-based rates, the impact is expected to average out and in most cases be minimal. The exception would be those customers on the edge of one large rate center area, making numerous calls to a nearby community that is on the edge of another large rate center area.
Staff contacted staff from the Colorado Commission, which recently consolidated rate centers in the Denver area. The Colorado staff indicated this was not a significant issue in their experience. The few individuals who contacted the Colorado Commission and complained about increased charges due to the consolidation were able to reduce their bills by either switching long distance carriers, or in most cases, simply taking advantage of the different rate plans for toll calls offered by their existing carrier. Minnesota PUC staff indicated their experience was similar.
U S WEST indicated it “did not anticipate requesting compensation” for the implementation of rate center consolidation as outlined in its comments. Based upon U S WEST’s comments, and our own investigation into this matter, Staff believes the cost of implementing rate center consolidation far outweighs the benefits. These costs, which are primarily those associated with re-programming to reflect the new rate centers, will be incurred by all service providers, with all companies facing similar costs and no company disadvantaged by the additional costs. Therefore Staff believes no specific cost recovery mechanism is necessary or appropriate.
Staff believes the Commission should consider at least some level of rate center consolidation. The primary issue remaining to be decided is the scope of the consolidation.

U S WEST recommended six consolidated rate center clusters, which would replace 42 current rate centers. Those six consolidated rate centers are as follows:

a. Boise, Emmett, Kuna, Idaho City, Melba, Meridian, Middleton, Star
b. Glenns Ferry, Mountain Home
c. Hailey, Ketchum
d. American Falls, Bancroft, Downey, Grace, Lava Hot Springs, McCammon, Montpelier, Pocatello, Preston, Soda Springs
e. Idaho Falls, Rexburg, Rigby, Ririe, Roberts, Shelley
f. Bliss, Buhl, Castleford, Eden/Hazelton, Gooding, Hagerman, Jerome, Kimberly, Murtaugh, Twin Falls, Shoshone/Dietrich, Wendell.

The following exchanges, because of unique EAS arrangements, would not be included in
the rate center consolidation: Blackfoot, Burley, Caldwell, Nampa, New Plymouth, Payette, and Weiser.
The primary determinant in U S WEST’s recommendation is that all rate centers within a proposed cluster currently have exactly the same local calling area. This is important, as the rate center is used in the determination of whether a call is toll or local, and in the calculation of the amount of toll. The current billing system used by all carriers would not function properly if calls from any location outside of a rate center to one location inside the rate center were considered local calls, while calls to another location in the rate center were considered toll calls. Therefore, all exchanges included within a single rate center must share the same local calling area.
The Company indicated that any EAS granted after the rate centers have been consolidated must be granted to the entire consolidated rate center. If Boise and Idaho City are consolidated into a single rate center, it would no longer be appropriate to grant an EAS to Idaho City without also granting EAS to Boise.
U S WEST raised the issue of pending EAS petitions that may affect the calling areas of some of the communities included in the six clusters recommended by U S WEST. Staff concurs with the concerns of the Company, and recommends delaying a decision in this case until after decisions are reached in each of these pending cases. Each of these cases is well underway and should be resolved in sufficient time to avoid any significant impacts from delaying the decision in this case. Staff recommends the Commission request additional comments regarding the extent of consolidation that would be appropriate at the conclusion of these cases.

The pending cases include:
GNR-T-97-4 Richfield to Magic Valley Region
GNR-T-99-2 Bruneau-Grandview to Treasure Valley Region
Both of the above to be resolved in Case Nos. CGS-T-99-04 and CEN-T-99-03.

GNR-T-99-11 Midvale/Cambridge/Council/Lowman EAS to
Treasure Valley Region
The above to be resolved in Case Nos. CAM-T-99-02 and MID-T-99-01.

A second issue is the impact of rate center consolidation on 911 emergency response systems. After consolidation, there will most likely be more than one Public Safety Answering Point (PSAP) in each rate center. For the overwhelming majority of calls to 911, this should not present a problem. The Automatic Number Identifier (ANI) information provided with each call allows the system to route the call to the appropriate PSAP. However, under rare circumstances some calls do not contain the information necessary for the proper routing of the calls. These calls are routed by what is referred to as “default routing.” Each new telephone service provider (typically a CLEC) will need to establish a unique trunk group to each default PSAP in a rate center. With more than one default PSAP in a rate center, every new competitor will experience higher costs after consolidation than without consolidation because of this requirement.
U S WEST claimed this issue has not “blunted the benefits of rate center consolidation in Arizona, Minnesota or Colorado.”
Staff agrees that this issue should not be a deterrent to rate center consolidation. However, state law and/or the Commission’s rules may need to be revised to clarify who is responsible for the costs of any system enhancements or changes made specifically to ensure that 911 calls are routed properly.

SUMMARY
In general, Staff supports the recommendations of U S WEST and the consolidation of 42 U S WEST rate centers into six, eliminating 36 rate centers. However, due to the potential impact of the decision in pending EAS cases, Staff recommends a decision in this case be delayed until
after those EAS cases are concluded. Staff recommends the Commission seek additional comment on the extent of consolidation that is appropriate in light of the decisions in those EAS cases.

Dated at Boise, Idaho, this day of December 1999.

________________________
Donald L. Howell, II
Deputy Attorney General

Technical Staff: Wayne Hart

DH:WH:gdk:i/umisc/comments/uswt9921.dhw
REPLY COMMENTS OF THE
COMMISSION STAFF 1 DECEMBER 9, 1999