28585.pdf

ORDER NO. 28585 -1-
Office of the Secretary
Service Date
December 12, 2000
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION

IN THE MATTER OF THE APPLICATION OF
INTEGRA TELECOM OF IDAHO, LLC FOR A
CERTIFICATE OF PUBLIC CONVENIENCE AND
NECESSITY TO PROVIDE COMPETITIVE
TELECOMMUNICATIONS SERVICES.

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CASE NO. GNR-T-00-15

ORDER NO. 28585

On May 2, 2000, Integra Telecom of Idaho, Inc. (“Integra”) filed an Application for a
Certificate of Public Convenience and Necessity to operate as a provider of facilities-based basic
local exchange and interexchange telecommunications services within the state of Idaho. Integra
also intends to provide resold intrastate interexchange services. On October 18, 2000, the
Commission issued a Notice of Application and Notice of Modified Procedure that required all
written comments to be filed by the parties on or before November 8, 2000. Order No. 28545. The
Commission Staff was the only party to file written comments and it recommended that the
Application be approved.
Based on the comments, the law and the record, the Commission grants the Application.
The Commission further finds that the Certificate should be issued subject to the filing of a bond.
BACKGROUND
Integra has applied for authority to provide facilities-based local exchange service,
including, but not limited to local dial tone services, extended area service, high speed Internet
access including DSL, dedicated and switched access long distance services and enhanced features
such as voice mail and Caller ID. Integra asserts that it is amply qualified legally, financially and
technically to provide telecommunications service in Idaho.
Staff reviewed the Application submitted by Integra and found that it included all of the
items identified by the Commission in Order No. 26665. Integra Telecom of Idaho, Inc. is an
Oregon corporation and a newly created affiliate of Integra Telecom, Inc., formerly known as OGIT
Communications, Inc. (OGIT), also an Oregon corporation. OGIT began in 1984 as a “shared
tenant” service provider and is now the parent company of an ILEC operation in Minnesota, and
CLEC operations in eight states serving approximately 50,000 access line equivalents.

ORDER NO. 28585 -2-
The Application indicated that the Company intends to provide a broad range of
telecommunications services, primarily to business customers, but also residential customers,
including local exchange service, long distance services, data services and vertical and advanced
features. The Company would provide service in the Qwest, Citizens and Verizon service areas, and
indicated it was not seeking the authority to compete in the areas of rural telephone companies with
exemptions. Services would be provided through the Company’s own switching facilities, along
with leased facilities, UNEs and resale.
The officers of both the parent company and Integra have extensive experience in the
telecommunications field as well as expertise in business management, marketing and capital
development. Staff believes this expertise to be sufficient for the range of services the Company
proposes to offer.
The Application included audited financial statements for the parent company for 1998
and unaudited statements for 1999, as well as financial projections for Integra. The Company
requested this information be maintained as confidential. The Application highlighted the strong
financial position of the parent company and included a request that the Commission not impose a
requirement for an escrow account because of this fact.
Staff's review of the financial information in the Application found a number of
indicators that supported the Company’s claim of the strong financial position of the parent
company, especially in comparison to other competitive local exchange companies. However,
expenses currently exceed revenues by significant amounts, and the amount is growing. In addition,
a significant percentage of the parent company’s assets were identified as intangible, and primarily
consisting of “the excess of purchase price over fair value of the net assets” the Company acquired
when it purchased ILEC operations in Minnesota and CLEC operations in Minnesota, North Dakota
and Wisconsin.
STAFF RECOMMENDATION
Based upon the information in the Application, Staff finds the financial information
provided by the Company demonstrates that Idaho consumers choosing Integra as a service provider
will be at some risk of the ability of the Company to continue to provide that service. Staff
recommends the Company be required to post a bond or other form of financial security of sufficient
size to protect Idaho customers in the event that it ceases operations in Idaho. Staff recommends an
initial bond or other financial security amount of no less than $50,000, based upon an estimated

ORDER NO. 28585 -3-
average exposure of $50 per customer, and a maximum of 1,000 customers recruited in the first year.
Staff recommends the Company be required to maintain the bond or other financial security at a
level equivalent to no less than $50 per customer, and provide the Commission with quarterly
reports identifying the number of customers. If the number of customers increases to a level that
would bring the bond amount to less than $50 per customer, the Company would be required to
provide the Commission with evidence that the bond or financial security amount had been
increased to exceed the $50 per customer level.
COMMISSION FINDINGS
Based on the comments, the law and the record, the Commission grants the Application.
The Commission further finds that the Certificate should be issued subject to Integra Telecom of
Idaho LLC providing evidence of establishment of the appropriate bond amount.
O R D E R
IT IS HEREBY ORDERED that Integra Telecom of Idaho, LLC is granted a Certificate
of Public Convenience and Necessity to provide basic local exchange services subject to the posting
of the appropriate bond amount.
THIS IS A FINAL ORDER. Any person interested in this Order or in interlocutory
Orders previously issued in this Case No. GNR-T-00-15 may petition for reconsideration within
twenty-one (21) days of the service date of this Order with regard to any matter decided in this Order
or in interlocutory Orders previously issued in this case . Within seven (7) days after any person has
petitioned for reconsideration, any other person may cross-petition for reconsideration. See
Idaho Code § 61-626.

ORDER NO. 28585 -4-
DONE by Order of the Idaho Public Utilities Commission at Boise, Idaho this
day of December 2000.

DENNIS S. HANSEN, PRESIDENT

MARSHA H. SMITH, COMMISSIONER

PAUL KJELLANDER, COMMISSIONER

ATTEST:

Jean D. Jewell
Commission Secretary

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