20031201_698.pdf

DECISION MEMORANDUM
TO:COMMISSIONER KJELLANDER
COMMISSIONER SMITH
COMMISSIONER HANSEN
COMMISSION SECRETARY
COMMISSION STAFF
LEGAL
WORKING FILE
FROM:DOUG COOLEY
DATE:NOVEMBER 28, 2003
RE:CUSTOMER COMPLAINT REGARDING QWEST LINE EXTENSION IN
NEZ PERCE COUNTY.
BACKGROUND
In July 2001 , approximately 30 customers in the Forest, Idaho area petitioned
for telephone service in and around Forest in Lewis County and Soldiers Meadow Reservoir in
Nez Perce County. In an effort to identify those actually interested, the Commission Staff sent
out surveys in June 2002, to as many people on the petition as possible. Twenty-five of the
twenty-nine surveys returned indicated interest in telephone service. Based on the locations of
these twenty-five interested individuals, Qwest prepared a cost estimate to extend service to
three groups of potential customers. The first two groups, comprising thirteen customers, are
within Qwest's service territory and the Company has agreed to build the plant required to
serve them. The third group is approximately one mile outside of Qwest's Craigmont
exchange boundary in unserved territory. (see attached map) This third group of twelve is
located approximately 3.5 miles west of Forest at various locations around Soldiers Meadow
Reservoir. Qwest estimates that its cost to extend service 3.5 miles from Forest to Soldiers
Meadow Reservoir for this group is $70 408. Of the fourteen parties near the reservoir who
responded to Staff's survey, nine indicated that they are vacation or weekend residents.
DECISION MEMORANDUM NOVEMBER 28, 2003
STAFF ANALYSIS
When the petition for telephone service was first filed, Qwest's northern Idaho tariff
allowed for one-half mile of line extension per applicant. Since that time, Qwest has modified
its tariff to allow a $1 600 line extension credit per applicant similar to its southern Idaho tariff.
After discussions with Qwest, Staff determined that the first two groups of potential customers
in and around Forest had enough grouped line extension allowances to avoid additional line
extension charges. These customers are within Qwest's Craigmont exchange. Qwest has
obtained commitment letters from these two groups and has already begun construction. Staff
further requested that Qwest design and extend service to those customers around Soldiers
Meadow Reservoir within the scope of the same construction project. However, Qwest
believes that line extension allowances apply only to applicants within its service territory and
that line extension charges to applicants outside its service area would be billed at the cost of
construction. Qwest points to Section 4.6 (C) (3) of its current Northern Idaho Exchange and
Network Service Tariff which states that "construction required to provide service outside of
exchange areas will be subject to construction charges equal to the entire cost of the
construction beyond the exchange boundary." Because Qwest is not interested in extending
service outside its service area to Soldiers Meadow Reservoir, it did not attempt to obtain
commitment letters from these parties.
Upon learning that Qwest did not intend to serve those applicants outside its service
area unless the estimated $70,408 cost was paid by the applicants, Ms. Vivian Kastner-Maras
a Soldiers Meadow resident, wrote a letter to the Commission dated September 29 2003. In
that letter, Ms. Kastner-Maras asked the Commission to "support our request for phone
service" for those near the reservoir.
Had the exchange boundaries included Soldiers Meadow Reservoir at the time of the
original petition, there could have been enough grouped allowances to extend service without
additional line extension charges. Of the fourteen that responded to Staff's survey, twelve
were interested in telephone service and were willing to pay up to $200 in line extension
charges if necessary. The Soldiers Meadow area has some cell phone coverage, although it is
patchy, and the residents appear to be largely seasonal or part-time occupants. In addition
Staff realizes that the exchange boundaries do not include the reservoir and that $70,408 for
twelve customers, or almost $5 900 per customer, is a relatively expensive project that could
burden other ratepayers in Qwest's northern Idaho service area.
DECISION MEMORANDUM NOVEMBER 28, 2003
Idaho Code 961-508 authorizes the Commission, based on evidence presented at a
hearing, to determine "that additions, repairs or improvements to or changes in the existing
plant
, "
... facilities or other physical property of any public utility. . ." ought reasonably to be
made, or that a new structure or structures should be erected, to promote the security or
convenience of its employees or the public, or in any other way to secure adequate service or
facilities" and issue an order directing the improvements "be erected in the manner and within
the specified time in said order.
Staff has informally been working with Qwest and the petitioners on this issue and
believes both have legitimate positions. Staff is sympathetic to those interested in telephone
service but, after weighing both sides of this argument, is not convinced that an extension to
Soldiers Meadow Reservoir is in the public interest or "ought reasonably be made (Idaho
Code 961-508) at this time. Staff presumes that the parties knew telephone service did not
exist when they purchased what is largely vacation property near Soldiers Meadow Reservoir.
Staff is also concerned that $70,408 for twelve customers is a relatively expensive project that
could eventually burden other rate payers in Qwest's northern Idaho service area. Staff hopes
that extending service may become more economical if more people move into that area in the
future.
COMMISSION DECISION
The Commission can either decline to further investigate the Soldiers Meadow
Reservoir residents ' request for service from Qwest or open a docket and schedule a hearing to
obtain additional evidence on the standards for ordering facilities construction contained in
Idaho Code 961-508.
Does the Commission wish to open a case and follow the procedures established in
Idaho Code 961-508 to investigate extending telephone service to Soldiers Meadow Reservoir?
DC/forestdecmem
~~Y
DECISION MEMORANDUM NOVEMBER 28, 2003