HomeMy WebLinkAbout19970417First Request to GTE.docSUSAN HAMLIN
DEPUTY ATTORNEY GENERAL
IDAHO PUBLIC UTILITIES COMMISSION
PO BOX 83720
BOISE, ID 83720-0074
(208) 334-0314
Street Address for Express Mail:
472 W. WASHINGTON STREET
BOISE, ID 83702-5983
Attorney for Commission Staff
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF THE APPLICATION OF GTE NORTHWEST, INCORPORATED TO DETERMINE AND FIX PROPER AND ADEQUATE RATES OF DEPRECIATION FOR SEVERAL CLASSES OF ITS DEPRECIABLE PROPERTY.
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CASE NO. GTE T 97 5
FIRST PRODUCTION REQUEST OF THE COMMISSION STAFF TO
GTE NORTHWEST
The Staff of the Idaho Public Utilities Commission, by and through its attorney of record, Susan Hamlin, Deputy Attorney General, requests that GTE Northwest, Incorporated provide the following documents and information on or before THURSDAY, MAY 8, 1997.
This Production Request is to be considered as continuing, and GTE Northwest, Incorporated is requested to provide, by way of supplementary responses, additional documents that it or any person acting on its behalf may later obtain that will augment the documents produced.
For each item, please indicate the name of the person(s) preparing the answers, along with the job title of such person(s) and the witness who can sponsor the answer at hearing.
If any of the information requested cannot be provided at the Commission offices in Boise, Idaho please notify the Commission Staff immediately so other arrangements can be made.
Request No. 1: Please identify each person that you intend to call as a witness either on direct (reply) or rebuttal (surrebuttal) by name, employer, job title and business.
Request No. 2: For each person identified in response to Request No. 2, please provide a curriculum vitae and copies of all testimony filed by the person in any regulatory jurisdiction for the last three years.
Request No. 3: Please provide all workpapers supporting the testimony in the present docket of each person that you identify as a witness. This is a continuing request and pertains to the rebuttal or surrebuttal of each witness as well as to their direct or reply testimony.
Request No. 4: The IPUC Staff intends to audit additions, retirements, and adjustments by vintage group for each account included in plant in service during the last ten years. Please state the proper location for this audit of plant in service and the individuals to contact for organizational details.
Request No. 5: Provide copies of any specific cost studies or cost allocation studies done in support of this depreciation case.
Request No. 6: Provide the objective (i.e., design) and actual fill factors for:
a. feeder plant
b. distribution plant
Request No. 7: Does GTE conduct any type of business case analysis (e.g., predictions of costs, revenues, reductions in operating costs, etc.) before undertaking a capital investment program? If the answer is in the affirmative:
a. What size of investment requires the undertaking of a business case analysis?
b. Describe fully (e.g., discounted cash flow predictions, etc.) the business case analyses used by GTE during 1994, 1995, and 1996.
c. Provide a copy of each business case analysis prepared by GTE for investments in Idaho for the years 1994, 1995, and 1996.
d. In conducting business case analyses, does the Company use the Commission-approved depreciation rates?
e. If the answer to part (d) is in the negative, provide the depreciation rates used and explain fully the reason for the departure from Commission-approved depreciation rates.
Request No. 8: Provide a copy of the following:
a. All studies prepared by Technology Futures, Inc. (TFI) relied upon by GTE in determining the depreciation rates requested in this case.
b. All work papers and analyses developed by, or on behalf of, TFI that support the findings made in each TFI study supplied in response to Request No. 5a.
c. All comparisons of prior forecasts to actual depreciation lives that TFI has prepared, or GTE has prepared to validate the accuracy of the TFI forecasts.
Request No. 9: For each of the studies related to Request Nos. 4 and 5, provide the following information:
a. The cost of capital;
b. Revenues from new services made possible by deployment of the new technologies substituting for GTE embedded investments;
c. Forecasts of GTE market share for those services furnished via the new technologies being deployed;
d. The rate of price inflation/deflation, either for the national economy or the specific types of new technologies being acquired;
e. Asset lives of new technology investments being undertaken;
f. Vintages of customer premises equipment used in conjunction with GTE services (e.g., telephone sets, modems, etc.).
g. Historical life indications for each account in Plant in Service.
h. Life projections for each account in Plant in Service.
i. Future net salvage for each account in Plant in Service.
j. The calculation of remaining life for each account in Plant in Service.
Request No. 10: Has GTE undertaken any changes to depreciation rates since the 1994 capital recovery study and represcription? If the answer is in the affirmative, please provide details of those changes and their effective dates.
Request No. 11: Please provide a Capital Recovery Study specifically related to Idaho. The study should be the same format as has been presented to the Idaho Commission for the 1994 depreciation represcription.
Request No. 12: Please list by account the prescribed depreciation rates effective at December 31, 1996 for the FCC and each state in which GTE Northwest, Inc. provides telephone services. Please indicate which rates are based on projected economic lives. For each jurisdiction please indicate the docket number, decision number, and provide a copy of the commission order adopting the depreciation rates.
Request No. 13: What is the reserve deficiency calculated using the depreciation rates posted in 1996 for Idaho? Please show details of the calculation.
Request No. 14: What is the reserve deficiency calculated using the depreciation rates requested by GTE in this case? Please show details of the calculation.
Request No. 15: Provide a list by wire center showing the type of switch in service and the date the switch was installed. Please indicate which switches are digital and which switches are analog.
Request No. 16: For each switch in Request No. 12 provide a schedule showing the capacity of the switch and the number of access lines in use at December 31, 1996.
Request No. 17: Provide a list of switches that are scheduled to be replaced and the proposed date of replacement.
Request No. 18: Provide a copy of the budget for capital expenditures for Idaho for the years 1994, 1995 and 1996.
Request No. 19: Provide a schedule of the changes that will occur to future capital expenditure budgets or future investments, assuming the Idaho Commission does not approve in whole or in part the $21.7 million increase in depreciation expense requested in this case. Please identify any other anticipated impact, utilizing the same assumption.
Request No. 20: Please describe fully the way GTE allocates the cost of its (a) spare outside plant capacity and (b) spare switch capacity between plant that is used and useful and plant that is held for future use.
Request No. 21: Identify, separately, for each central office in GTE territory in Idaho, the following:
a. The total number of working lines as follows:
(1) Residential lines
(2) Business lines
(3) Centrex lines
(4) Coin lines
(5) Private Line and Special Access lines.
(6) Other lines; please specify what lines this encompasses.
b. The total number of loops in each central office, i.e., all available loops, regardless of whether they have been assigned to working lines.
Please provide responses to parts a and b in the form of year end data for each year, 1994, 1995, and 1996.
Request No. 22: What models or other evidence have been used to define and quantify that the current depreciation rates and policy cause harm and disadvantage to GTE Northwest Incorporated?
Request No. 23: Provide any and all documents, work papers, and studies prepared by or on behalf of GTE that discuss or show the schedules used by current competitors and likely to be used by the new local service providers.
Request No. 24: With respect to the table at page 12 of Mr. Sovereigns testimony, what are the appropriate headings for the four columns to bring them into consistency with the reference noted, to page 33 of Vanston and Hodges?
Request No. 25: Mr. Sovereign states on page 9 that competition requires that the regulated depreciation process of the past be changed. Provide documentation supporting this claim; list all entrants and the markets in which they are currently competing (by service and by geography).
Request No. 26: Please describe any differences in the accounting procedures utilized by the following companies: MFS, MCI, AT&T, Airtouch, US Cellular, TCI, and Cox vis-a-vis those employed by GTE. Are these companies required to comply with USOA accounting procedures? Explain how such differences, if any, impact the comparison of depreciation lives.
Request No. 27: With reference to the table on page 18 of Mr. Sovereigns testimony, please list the depreciation lives reported by these companies for accounts other than those shown.
Request No. 28: Relative to the specific technology substitution curves and asset lives determined by TFI, please respond to the following questions. For each of the factors identified below, please explain in detail how, if at all, in the methodology used in his study, the factor is applied as an input to the calculation of technology substitution curves underlying the determination of GTE asset lives:
a. The cost of capital;
b. Revenues from new services made possible by deployment of the new technologies substituting for GTE embedded investments;
c. Forecasts of GTE market share for those services furnished via the new technologies being deployed;
d. The rate of price inflation/deflation, either for the national economy or the specific types of new technologies being acquired;
e. Asset lives of new technology investments being undertaken;
f. Vintages of customer premises equipment used in conjunction with GTE services (e.g., telephone sets, modems, etc.).
Request No. 29: Describe fully the competitive environment that your statements contemplate. For the environment to be competitive what minimum levels of market share would GTE need to lose (a) in the retail local exchange market; (b) to facilities bypass; (c) to resellers; (d) to competitors purchasing unbundled network elements?
Request No. 30: The following questions are in reference to future investments in the GTE service area:
a. What is GTEs time horizon for planning of digital circuit equipment technology deployments in Idaho?
b. Provide GTEs current technology deployment plan that identifies all planned digital circuit equipment installations, replacements, or upgrades.
Request No. 31: Please provide the following information regarding TFI:
a. List all TFI documents (reports, studies, papers, etc.) submitted in state or federal proceedings over the last five years.
b. List all proceedings in which TFI has submitted one or more of the documents listed in response to part a above and provide:
(1) The jurisdiction of the proceeding;
(2) The case or docket number in which the report(s) was (were) submitted;
(3) The date on which the report(s) was (were) submitted;
(4) The party on whose behalf the report was submitted; and
(5) Whether expert witness testimony was submitted in Idaho. If not already specified in the technology deployment plan, provide the following data for each interoffice route for which digital circuit equipment installation is planned through the Companys time horizon (prior question, or use the year 2000 as a default): facilities location/route, scheduled cut-over date, total usable capacity to be installed (in voice grade equivalent circuits) and capital expenditures.
c. Provide all studies, reports, memoranda, or other analyses prepared by GTE using capital utilization criteria (CUCRIT) or similar cost-benefit study methods that support the Companys planned digital circuit equipment installations in Idaho.
Request No. 32: With reference to the TFI study, Depreciation Lives for Telecommunications Equipment, provide all comparisons of prior forecasts to actual that TFI has prepared to validate the accuracy of the Fisher-Pry Model as applied to telecommunications technology substitution. In addition, provide all similar analyses that GTE has prepared for the same purpose.
Request No. 33: Please identify any and all other state regulatory commissions which have accepted, in whole or in part, GTE proposals for revised account lives and depreciation lives which are based on any of the TFI studies. For each case that you identify, supply the docket number, decision number, and date of the commission order adopting the proposal, and provide a copy of the order.
Request No. 34: Please identify any and all other state regulatory commissions that GTE is aware of which have accepted, in whole or in part, ILEC proposals for revised account lives and depreciation lives which are based in whole or in part on the Fisher-Pry technology substitution method. For each case that you identify, supply the docket number, decision number, and date of the commission order adopting the proposal, and provide a copy of the order.
Request No. 35: Has the Company ever sought or used Mr. Vanstons advice or counsel in forecasting economic lives in connection with capital budgeting decisions? If so, please describe fully the nature of his involvement in these decisions, the acquisition in question, and the dates of such consultation.
DATED at Boise, Idaho, this day of April, 1997.
______________________________________
Susan Hamlin
Deputy Attorney General
SH:SL/umisc\prdreq\gtet975.sh
FIRST PRODUCTION REQUEST 1 APRIL 17, 1997
TO GTE NORTHWEST