20030324_413.pdf

DECISION MEMORANDUM
TO:CO MMISSI 0 NER KJELLAND ER
COMMISSIONER SMITH
COMMISSIONER HANSEN
COMMISSION SECRETARY
COMMISSION STAFF
LEGAL
WORKING FILE
FROM:DOUG COOLEY
DATE:MARCH 20, 2003
RE:TELECOMMUNICATION RELAY SERVICES 2002 ANNUAL REPORT
On February 11 2003, Idaho s Telecommunications Relay Service (TRS) Administrator
Mr. Robert Dunbar, submitted his calendar year 2002 Annual Report to the Commission.
reported that conversation time on the relay service, including interstate long distance, totaled
520 741 minutes. This represents no change from calendar year 2001. Likewise, disbursements
to Hamilton Telecommunications in 2002 ($554 296) were virtually unchanged from 2001
($550 900). In-state relay traffic is reimbursed by Idaho s TRS Fund while the National
Exchange Carrier Association (NECA) reimburses Hamilton for out-of-state calls that are placed
via the relay service.
Disbursements
Hamilton Telecommunications
Administrative Expenses
Total
2002
$554 296
34,445
$588 741
2001
$550 900
31.145
$582 045
CONTRIBUTIONS TO THE TRS FUND - 2002
The total number of intrastate toll minutes that the TRS was able to bill, after late-filed
true-ups, decreased by nearly 22% from 2001 to approximately 293,460 000 minutes. These
TRS totals mirror the totals reported to the Universal Service Fund (USF), which has a similar
method of collection. Staff found steady decreases in reported intrastate toll minutes over the
past two years from each of the several companies it reviewed and no EAS cases were
implemented during 2002. Staff agrees with Mr. Dunbar s appraisal that the popularity of
DECISION MEMORANDUM MARCH 20, 2003
wireless toll plans, E-mail usage, and even a slow economy contributes to the decreasing
intrastate toll minutes.
Based on the data reported as of December 31 2002, Idaho s line count is approximately
771 758 , which is a 5% decrease from 2001. This estimate does not include pagers or wireless
phones.
Contributions
From basic service providers
From MTS/W A TS providers
Interest earned on funds
Total
2002
$346 237
182 546
450
$529 233
(65%)
(35%)
The above transactions resulted in a decrease of$59 508 to the TRS fund bringing the
2002 year-end balance to $189 699. On March 4 2003, the TRS Fund balance was $205 738.
This amount approximates a four-month reserve for the fund that collects from many accounts on
a quarterly basis.
Staff commends Mr. Dunbar for his continued effective administration ofthis service.
Idaho Relay Service can now be reached by simply dialing 711 from any phone in Idaho and also
provides Spanish relay service. During the past year, the Idaho TRS submitted its certification to
the FCC and will not require re-certification until 2007.
SETTING TRS CONTRIBUTION RATES FOR 2003
Mr. Dunbar has projected an annual operating expense requirement for 2003 of$613 690.
While not expecting an increase to relay usage, Mr. Dunbar s budget includes an estimated 4%
increase in disbursements in the event of unexpected expenses related to next year s contract
review with Hamilton. This budget also includes approximately $3 500 for an independent audit
of the Idaho Relay for 2002.
Over time, the balanced contribution the Commission sought in Order No. 24525
between local exchange service and toll service has migrated toward more contributions coming
from the local exchange companies. However, to meet the estimated budget requirement, Mr.
Dunbar recommends that the TRS contribution rate not be adjusted at this time. Staff agrees
with this recommendation and presents the following projected TRS income for the coming year.
DECISION MEMORANDUM MARCH 20, 2003
No Change in TRS Contribution
Estimated lines 775 000 x $.04 x 12 months =
Estimated minutes 300 000 000 x $.0007
Total
$372 000
$206,500
$578 500
(64%)
(36%)
The estimated revenues above assume essentially no growth in intrastate toll minutes or
exchange lines. While use of the relay system does not appear to be changing, revenue from
intrastate toll minutes appears to be decreasing, which may require an adjustment to contribution
rates before next year. At this time, however, Staff is hesitant to increase the per-minute rate that
toll providers contribute when those companies are already losing minutes to other sources. With
some reserve currently in the fund, Staff agrees with Mr. Dunbar s suggestion to continue
monitoring the fund during the year and make adjustments if a demonstrated need arises rather
than making adjustments now and potentially over funding the account. The approximately
$35 000 between the projected revenue and the estimated budget requirement would come from
the fund's reserve.
STAFF RECOMMENDATION
Based on the proposed TRS budget for 2003 , Staff recommends that 2003 TRS
contributions remain at $.04 per line per month and $.0007 per intrastate toll minute in
accordance with Order No. 28684.
COMMISSION DECISION
1. Does the Commission wish to keep the TRS contribution rates at the current level as
established by Order No. 28684?
2. Does the Commission wish to change the distribution or the methodology in some
other way?
Irs report for 2002
DECISION MEMORANDUM MARCH 20, 2003