20040512Order No 29491.pdf

Office of the Secretary
Service Date
May 12, 2004
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
ROBERT RYDER DBA RADIO PAGING
SERVICE, JOSEPH B. McNEAL DBA SUPREME COURT
AGEDA T A AND INTERP AGE OF IDAHO,DOCKET NO. 29175
AND TEL-CAR, INC.
Petitioners/Appellants,
IDAHO PUBLIC UTILITIES COMMISSION,IPUC CASE NO. USW-99-
Respondent on Appeal
and
QWEST CORPORATION,
Respondent/Respondent on Appeal.ORDER NO. 29491
On February 13 , 2004, the parties captioned above filed a Stipulated Motion with the
Supreme Court to suspend the appeal and remand this matter back to the Public Utilities
Commission. The parties maintained there was good cause to suspend the appeal, primarily so
they could consider a recent decision issued by the United States Court of Appeals for the
District of Columbia Circuit. The Motion noted that this Circuit decision addressed two federal
telecommunication issues that are encompassed in this appeal. The Motion noted that the
temporary remand would allow: (1) the Commission to reconsider its Orders in light of the
recent Circuit Court opinion; (2) the Federal Communications Commission (FCC) to address at
least one of the telecommunications issues on remand; and (3) the parties another opportunity to
settle the appeal. Stipulated Motion at 4.
On March 8, 2004, the Court suspended the appeal and remanded the matter back to
the Commission. The Court suspended the appeal until May 12, 2004
, "
at which time the due
date for filing Appellants' Brief shall be reset unless otherwise provided by an Order of this
Court. "
ORDER NO. 29491
Following the Court's remand, negotiations to settle or narrow the issues on appeal
have failed. In addition, the FCC has yet to issue any order addressing the federal issues. Given
this state of events, the Commission finds that it is appropriate to issue this scheduling Order
requiring the parties to address several questions set out below.
THE COMMISSION'S PRIOR ORDER
In November 2002 the Commission issued its final Order on Reconsideration
No. 29140 in the second part of this two-part case. The underlying proceeding was initiated
when three paging companies (Radio Paging Service, PageData, and Tel-Car, hereinafter
referred to as "the Pagers ) filed a Petition for Declaratory Order seeking relief against Qwest
Corporation s predecessor, US WEST Communications. In Order No. 29140 the Commission
found that the Pagers were entitled to refund credits from Qwest but not in the amounts they had
claimed. The Order also decided many issues including two disputed issues pertinent to the
present appeal: (1) wide area calling; and (2) transit traffic. These issues are described in greater
detail below.
1. Wide Area Calling
. "
Wide area calling" generally refers to "an arrangement or
service "that allows a paging carrier to subsidize the cost of calls from (Qwest'sJ customers to a
paging carrier s customers, when the caller and the paging company are located in different local
calling areas." Order No. 29140 at 5. Normally telephone calls from one local calling area to
another local calling area are assessed "toll" or long-distance charges. Paging carriers can create
and use a number of different wide area calling arrangements so that it would appear to callers
that toll charges will not be assessed when calling a paging company located in a different local
calling area. Id. at 37; Mountain Communications v. Qwest Corporation.These arrangements
include: 800 service, DID configurations, reverse billing or reverse toll, FX (foreign exchange),
and other possible configurations such as frame relay.Order No. 29140 at 37 quoting Order
No. 29064 at 28 citing Mountain Communications at ~ 3.
In this case, the Commission found that PageData and Tele-Car had configured their
paging systems in a manner that constituted wide area calling arrangements. Order No. 29140 at
37. "For example, Tele-Car s wide area calling arrangement allowed it to "provide toll-free
service from Hailey, Idaho to Twin Falls, Idaho without a toll charge to.. . our potential
Memorandum Opinion and Order 17 FCC Rcd 2091 (February 4, 2002), vacated and remanded sub nom.
Mountain Communications v. FCC 355 F.3d 644 (D.C. Cir. 2004).
ORDER NO. 29491
customers or subscribers or the person that would be calling (the paging customerJ.Id.
(emphasis original). In PageData s case, the Commission found that PageData "wanted to
consolidate his four points of interconnection into a single LATA-wide point of interconnection
so that (PageData' s J paging and other services could all be transported by T -1 facilities and
frame relay services." Order No. 29064 at 24 (emphasis omitted).
2. Transit Traffic The Commission also recognized that FCC regulations and
controlling decisions prohibit Qwest from charging the Pagers for the delivery of Qwest-
originated traffic or for facility used to deliver Qwest-originated traffic. Order No. 29140 at 5
23. However, the Commission noted that the FCC has ruled that pagers "are required to pay for
transit traffic ' that is , traffic that originates from a carrier other than the interconnecting LEC
(in this case QwestJ but nonetheless is carried over the LEC network to the paging carrier
network." Id. at 23 quoting TSR Order at n. 70 (emphasis original).
Consistent with several FCC orders, the Commission found that Qwest was permitted
to charge the Pagers for transit traffic originated by third-party carriers. Although both the
Pagers and Qwest offered conflicting evidence, the Commission found that 24% of the Pagers
traffic was properly classified as transit traffic. Order No. 29140 at 5. Consequently, Qwest
offset the refund credits owed to the Pagers by the charges assessed for transit traffic.
THE FCC DECISION AND
THE CIRCUIT COURT OPINION
Mountain Communications is a paging carrier serving customers in three Colorado
local calling areas. Like the present case, Qwest is the provider of local service within each of
the three Colorado calling areas. Although Mountain serves all three areas, it has a single point
of interconnection (POI) with Qwest in one of the three areas as permitted by federal law.
Mountain Communications v. FCC 355 F.3d 644, 645 (D.C. Cir. 2004) citing 47 U.
~ 251 (c )(2)(B) (LECs must provide interconnection facilities with other carriers "at any
technically feasible point within the (incumbent LEC'sJ network"
).
As previously mentioned, a
call from one local calling area to another local calling area is considered a toll call. Thus, a
Qwest call from the two local calling areas to Mountain s POI in the third calling area would
TSR Wireless v. US WEST, Memorandum Opinion and Order 15 FCC Rcd 11166 (2000), aff'd sub nom. Qwest
Corporation v. FCC 252 F.3d 462 (D.c. Cir. 2001).
ORDER NO. 29491
normally be considered a toll call. A Qwest call originating from the local calling area where
Mountain s POI is located, would not be a toll call.
In the Mountain case, Qwest sought to collect fees from Mountain when a Qwest
customer in one of the two different calling areas placed a call to Mountain s POI. Although
Qwest considered these interexchange calls to be toll calls, it did not charge its own customers
for placing such calls. 355 F.3d at 645.
1. The FCC Decision. Before the FCC, Mountain argued that the FCC's regulation
at 47 C.R. ~ 51.703(b) bars Qwest from assessing the Pager charges on Qwest-originated
traffic. More specifically, this FCC regulation provides that a "LEC may not assess charges on
any other telecommunications carrier for telecommunications traffic that originates on the LEC'
network." Mountain asserted that because its local paging area3 encompasses all three Qwest
local calling areas, Qwest is not permitted to charge Mountain for Qwest-originated traffic or for
facilities Qwest uses to deliver its traffic to Mountain s single-POI. 17 FCC Rcd 2091 at ~~ 8-
, 12-13; see also TSR Order at ~ 32. Thus, Mountain insisted that Qwest should be prohibited
from charging for wide area calling and for transit traffic.
Qwest responded that it was entitled to charge Mountain for the toll charges it was
unable to assess its own customers. Id. As the Circuit Court subsequently explained:
According to Qwest, Mountain could avoid the toll charges by establishing a
POI in each of the three local calling areas-doubtless at an increased cost.
Then, if a paging call were placed from a local number to another local
number, no toll would be charged to anyone. If, on the other hand, a paging
call were made from one local calling area to another, Qwest would transport
the call to Mountain s POI-without crossing a local calling area boundary-
at which time Mountain would assume responsibility for delivering the call
across the local calling areas, presumably at Mountain s expense.
Id. at 645-46 (emphasis original).
The FCC rejected Mountain s claims. The FCC determined that by "configuring its
interconnection arrangement in this manner, Mountain prevents Qwest from charging its
customers for what would ordinarily be toll calls to access Mountain s network." Mountain
Communications v. Qwest Communications, Order on Review 17 FCC Rcd 15135 at ~ 5 (2002).
3 As a Commercial Mobile Radio Service (CMRS) provider, Mountain s local paging area is defined by the FCC as
a Major Trading Area (MTA). In the Idaho case the MTA encompasses the entire Boise LATA, i., all of southern
Idaho.
ORDER NO. 29491
Consequently, the FCC held that Mountain had obtained a wide area calling service and
therefore Qwest was entitled to charge Mountain for that service. Id.
Turning to the transit traffic issue, the FCC determined that Qwest may lawfully
charge Mountain for transit traffic. Relying upon the TSR Order and the then recent Texcom
Order the FCC determined that a LEC may lawfully charge a paging carrier for the facilities
used to transport transiting traffic. Mountain Order on Review 17 FCC Rcd 15135 at ~ 2.
2. The Circuit Decision. On appeal, Mountain argued that the FCC's wide area
calling decision is at odds with the FCC's own regulation (Section 51.703(b)) and with the TSR
Wireless decision. The Circuit Court agreed. The Court observed that "the facts of TSR are
identical to" the facts presented in Mountain. Mountain 355 F.3d at 646. Despite having
identical facts, the results of the two cases "are opposite.Id. Thus the FCC's decision in the
Mountain case is "logically inconsistent with (the FCC's) TSR Decision.Id. at 647. The Court
also noted the FCC "seemingly comes into direct conflict with its own regulation , Section
51.703(b). The Court "rather easily conclude(d) that the Commission s decision on this issue is
arbitrary and capricious" and vacated the FCC's Order. Id. at 649.
Mountain also objected to Qwest's assessment of charges for transit traffic. The
Court observed that the FCC allowed "Qwest to charge for this service, but... Mountain could
seek reimbursement from the originating carrier for whatever charges (Mountain) paid to Qwest."
Mountain objected "because it does not follow the standard practice of charging the cost of calls
to the network of the party initiating the call." Id. Mountain further asserted that Qwest never
provided the necessary caller information to determine which carrier initiated the transit calls.
the Court explained, by
indicating that Mountain could charge the originating carrier, (the FCC)
suggested that Mountain was essentially correct in claiming that the
originating carrier should bear all of the transport costs. At oral argument
Qwest's counsel obviated any need for us to decide this issue by indicating
that Qwest would provide Mountain with the information necessary so that
Mountain could charge the originating carrier for reimbursement. Under those
circumstances, Mountain dropped that part of its Petition.
Texcom v.Bell Atlantic, Memorandum Opinion and Order 16 FCC Rcd 21493 at 'if'if 4-6 (Nov. 28 , 2001), reconsid.
denied 17 FCC Record 6275 (March 27, 2002). In Texcom the Commission found that the interconnecting LEC
may charge the Pager for the costs of the portion of the facilities used to transport transiting traffic from the
interconnecting LEC's network to the Pager s network. 17 FCC Rcd 6275 at 'if 4. The FCC explained that the Pager
may then seek reimbursement of transit traffic costs from the carrier that originated the transiting traffic. Id.
Mountain 17 FCC Rcd 2091 at n. 30.
ORDER NO. 29491
Id. With this background, we now turn to the facts in this appeal.
THE RECORD ON APPEAL
Relying on the FCC'Mountain Communications and TSR Orders this Commission
found that Qwest may properly charge the Pagers for facilities used for wide area calling
arrangements.Order No. 29140 at 36. The Commission quoted approvingly from the TSR
Order where the FCC found that
nothing prevents US WEST from charging its end users for toll calls
completed over a (toll route) T-1 (facility). Similarly, Section 51.703(b) does
not preclude (the Pager) and U S WEST from entering into wide area calling
or reverse billing arrangement whereby (the Pager) can "buy-down" the cost
of such toll calls to make it appear to end users that they have made a local
call rather than a toll call (to reach the Pager).
Order No. 29140 at 37 quoting TSR Order at ~ 31 (footnotes omitted).
The Commission determined that PageData and Tel-Car had configured their paging
networks in a manner that constituted wide area calling arrangements. Order No. 29140 at 37
Order No. 29064 at 27; Tr. at 145, 163. Tel-Car s witness stated his paging company used
Qwest facility to provide toll-free calling between the Qwest local exchanges of Hailey and Twin
Falls-a distance of approximately 68 miles. Tr. at 143. He explained that the facility was
acquired through negotiations with Qwest approximately 25 years earlier "with an Agreement
signed between us." Tr. at 145.
In PageData s case, it originally had four points of interconnection (POls) with Qwest
but later sought to consolidate its four POls into a single POI in Boise on or about August 1998.
Order No. 29140 at 38; Pager Exhibits 111 (pp. 10, 25 , 30), Exhibit 112; Tr. at 164. The
Commission found that PageData had entered into a wide area calling arrangement when it
requested frame relay facilities to transport its network traffic to the single POI. Order Nos.
29140 at 39; 29064 at 27.
Turning to the issue of transit traffic, the Commission found it was appropriate for
Qwest to charge the Pagers for traffic originated by other carriers. The Commission decision
regarding transit traffic was based upon the various FCC Orders. Order Nos. 29064 at 4-
29140 at 5, 23-33. After reviewing conflicting evidence, the Commission found that 24% of the
traffic Qwest delivered to the Pagers was properly classified as transit traffic. Order No. 29140
ORDER NO. 29491
at 23. Consequently, Qwest was allowed to offset the amount of credits it owed the Pagers with
the transit traffic charges.
DISCUSSION
As the events described above indicate, the Commission s findings regarding wide
area calling and transit traffic were primarily based upon FCC Orders. As noted above, the
Court of Appeals for the District of Columbia Circuit vacated the FCC'Mountain
Communications Order on the wide area calling issue and remanded the case back to the FCC.
The Court did not decide the issue of transit traffic because Qwest agreed to provide the
necessary information "so that Mountain could charge the originating carrier for
reimbursement." Mountain 355 F.3d at 649. It was undisputed that Qwest need not absorb
transit traffic costs. Id. The unanswered question was whether Qwest should charge the
originating carrier, or whether Qwest should provide the call detail to the Pagers who could in
turn seek reimbursement from the originating carriers.
The Commission finds it is appropriate for the parties to provide additional briefing
regarding the wide area calling and transit traffic issues. More specifically, the parties are
directed to submit briefs or memoranda that address the following questions:
Wide Area Calling
1. For each Pager, provide the total amount of wide area calling charges (e., 800
, DID, etc.) assessed by Qwest. Describe with specificity the exact wide area calling service
(if any) that each Pager utilized.
2. Based upon the Record, did any of the Pagers voluntarily enter into a "buy-down
agreement" (e., 800, FX, etc.) with Qwest so that Qwest would not assess toll charges on its
customers ' calls to a Pager located in another local calling area? See 355 F.3d at 648.
Qwest should prepare an exhibit that shows the amount of charges it assessed each
Pager individually (if any) for wide area calling arrangements or services. The calculation of the
amounts at issue for wide area calling shall also include an itemization of the applied interest.
Interest should be calculated up to July 1 , 2004.
Transit Traffic
3. Describe in detail the call data provided to Qwest by the originating wire line or
wireless carrier for all transit traffic to each Pager during the relevant time periods.
ORDER NO. 29491
4. Given Qwest's offer to provide transit traffic data to Mountain, is Qwest in a
position to provide transit traffic data to the Pagers in this case?
5. If such traffic transit data is no longer available, is it appropriate to credit the
Pagers for transit traffic?
6. During the relevant time periods, what percentage of transit traffic was wireline;
what percentage was wireless?
7. As noted in Order No. 29140 at pages 40-, the Commission authorized Qwest
to create three large-regional local calling areas (Magic Valley, Treasure Valley and eastern
Idaho) in 1996.These regions were implemented in February, April, and May 1997
respectively. In Order No. 27633 the Commission approved a cost recovery methodology for
Qwest when local calling (EAS) was authorized between a non-Qwest exchange and a Qwest
local calling region. Would this cost recovery mechanism support a reduction in the amount of
non-compensation transit traffic? If so, by what amount?
Qwest shall calculate the amount of transit traffic charged to each Pager during the
relevant time periods. The calculation shall include an itemization of interest through July 1
2004.
Qwest shall first respond to the questions set out above and supply the necessary
credit calculations regarding each question. Qwest shall supply its response within 14 days of
the date of this Order.Once Qwest has filed its response, then the Pagers will have
opportunity to respond to the questions and reply to Qwest's information/calculations no later
than 28 days from the date of this Order.
ORDER
IT IS HEREBY ORDERED that the parties respond to the questions stated above.
Qwest shall provide its responses and credit calculations no later than 14 days from the date of
this Order.
IT IS FURTHER ORDERED that once Qwest has filed its responses and calculations
in response to the questions contained in the body of this Order, then the Pagers will have an
opportunity to respond to the questions and to reply to Qwest's responses. The Pagers' replies
shall be filed with the Commission no later than 28 days from the date of this Order.
IT IS FURTHER ORDERED that the parties shall comply with the timelines set out
in this Order.
ORDER NO. 29491
DONE by Order of the Idaho Public Utilities Commission at Boise, Idaho this / / fI-.
day of May 2004.
MARSHA H. SMITH, COMMISSIONER
IS S. HANSEN, COMMISSIONER
ATTEST:
vld/O:USWT9924 dh
ORDER NO. 29491