telecom.pdf

IDAHO PUBLIC UTILITIES COMMISSION Page 262000
ANNUAL REPORT
Idaho Telecommunications
Mergers & Market Openings
New Names
Mergers and acquisitions affected Idaho in a big way this past year,
with over 90% of Idaho’s telephone customers getting a “new” service pro-
vider. All three of the state’s largest incumbent local exchange carriers were
involved with a merger or sale, with U S WEST South becoming a part of
Qwest, GTE joining Bell Atlantic and becoming Verizon, and US WEST North
being sold to Citizens.
Other than the name on the bill, most customers did not notice any
immediate changes. However, as the new companies gain more experience
with their new partners and service areas, they may begin to put their own
stamp on their services.
The Idaho mergers and sales are part of the national trend, with all of
the major Bell Operating Companies (BOCs) (the local exchange companies
created with the break-up of AT&T) as well as GTE, the other large national
local exchange company, now having merged, either together or with another
carrier. The combined companies expect to be able to more readily compete in
the deregulated telecommunications market.
The other national trend also impacting Idaho is the sale of rural ex-
changes owned by the BOCs to smaller, more rural-oriented companies. In
Idaho, U S WEST sold its entire North Idaho service area to Citizens Commu-
nications. While this sale had not yet completed all of the regulatory hurdles and
therefore has not become effective, the Idaho Commission did complete its
review and approved the transfer of these exchanges from US WEST to
Citizens.
Local Calling Area Extensions
Addressing customer petitions for expanding the calling areas that could
be accessed with a local call continued to require considerable Commission
resources. The Commission approved the expansion of local calling areas for
customers of Rural, CenturyTel of the Gem State, Cambridge, Council and
Midvale. Proceedings were initiated to address the calling areas of Potlatch
and to consider including Ontario and other communities in Eastern Oregon in
the calling areas of most Southwestern Idaho customers.
Approved EAS
Tipanuk, Prairie,
Boise River,
Cambridge, Council,
Midvale,
Bruneau, Grand View
(Added To Treasure
Valley Region)
Richfield
(Added To Magic
Valley Region)
Lowman - Boise &
Boise County
Pending EAS
Potlatch-Lewiston
Eastern Oregon-
Treasure Valley
Closed/Denied EAS
Parma-Emmett
Yellow Pine-McCall,
Cascade
Atlanta-Boise
Is Now
Is Now
2000
ANNUAL REPORTPage 27 IDAHO PUBLIC UTILITIES COMMISSION
Competition Slow To Develop
It has now been more than four years since the passage of the federal
Telecommunications Act of 1996 made it legal for competition to develop for
local exchange services, but making competition legal has not made it happen.
Although regulatory barriers to competition in Idaho have been eliminated, most
Idaho consumers still do not have a choice, and the few who do have choices
are not enjoying the full advantages of competition envisioned by Congress.
Market forces, and not legal or regulatory barriers, are the primary
factors leading to the slow progress of competition in Idaho. The Idaho Public
Utilities Commission has granted more than 46 companies with Certificates of
Public Convenience and Necessity to provide competitive local exchange
service by June 30, 2000. However, only a handful of these competitive local
exchange companies (CLECs) have made the market decision to actually
provide service to customers.
In the year covered by this report, the Commission also approved 44
interconnection agreements (or amendments) between incumbent telephone
companies and competitors, including those providing wireless or paging ser-
vices. These agreements specify the terms and conditions for connecting one
company’s system to the others, in order that calls may transfer seamlessly from
one company to the next. They also include the terms and conditions under
which an incumbent will sell its services, or the individual network elements that
CLEC’s may use to provide competitive services without duplicating the existing
facilities.
Enhancing Competition
The Idaho Telecommunications Act of 1988 allowed telephone compa-
nies to elect modified regulation for all but basic local exchange service to
customers with five or fewer lines at one location. U S WEST chose partial
deregulation under Title 62 for its territory in southern Idaho, beginning April 1,
1989. All telecommunications companies that only provide long distance ser-
vices also come under the provisions of Title 62.
The Commission retains the authority to review the quality, availability,
terms and conditions of service offered by economically deregulated Title 62
companies. Services provided by the new CLECs are not rate-regulated, but,
in accordance with the provisions of Title 62, are subject to the Commission’s
rules. Telecommunications companies not providing basic local service, such as
a long distance company, are also not subject to rate-setting authority of Title
61, but must comply with Title 62 rules. Upon complaint, the Commission may
hold hearings and order changes if the public interest is adversely affected, and
may resolve disputes between companies. Title 62 regulations require that price
lists be filed with the Commission.
Idaho Telecommunications
Nearly 500
companies had filed
Title 62 price lists with
the Commission by
the end of July, 1999.
Competitive Local
Exchange Carrier
Certificates
Approved in FY00
13
Total Approved
(as of 7/1/00)
46
Interconnection
Agreements
Agreements or
Amendments
Approved in FY00
44
Total Agreements
Approved
(as of 7/1/00)
91
IDAHO PUBLIC UTILITIES COMMISSION Page 282000
ANNUAL REPORT
Idaho Telecommunications
Incumbent Local Exchange Companies
In addition to the North Idaho service area of Qwest that is being
transferred to Citizens, and which will remain fully regulated and subject to the
provisions of Title 61, there are 16 other local exchange companies whose
services are still fully regulated by the IPUC. Qwest’s (Formerly U S WEST)
Southern Idaho operating company is by far the largest local exchange com-
pany, with over 67-percent of the customer lines (approximately 500,000) in
the state. Verizon (formerly GTE) is a distant second, with nearly130,000
access lines (approximately 18%). The current Qwest North service area is the
third largest, with 36,000, or 5%. The purchase of these lines will more than
double Citizens’ presence in Idaho, as it currently has more than 20,000 access
lines (3%). Fourteen other regulated telecommunications companies also serve
Idaho residents, as well as six mutual or cooperative companies. These 20
companies serve the remaining 7%.
Eliminating Hidden Subsidies
In keeping with Section 62-623 of the Idaho Code, the rates of two
more of Idaho’s telephone companies were restructured to reduce subsidies
that might have been a deterrent to competition. The rates of CenturyTel of the
Gem State, which serves customers in the Richfield, Bruneau, Grand View and
Grassmere-Riddle exchanges, and CenturyTel of Idaho, which serves custom-
ers in the Salmon area, were examined. In both cases, the charges imposed
upon long distance companies for access to the local network, known as
access charges, were reduced to levels at or near the statewide average for
such charges.
To compensate for the reduction in revenues caused by these reduc-
tions, the rates for local exchange service were increased. The difference
between the rates charged for business and residential service was also nar-
rowed in this process.
Only one small company, Oregon -Idaho Utilities, which provides
service in the Silver City and Jordan Valley, Oregon area, has access charge
rates that remained well above the statewide average. The Idaho Commission
staff, in cooperation with the Oregon Commission staff, has initiated an investi-
gation of its charges as well.
An examination of high cost support for non-rural companies was also
initiated during the year. Non-rural companies serve rural or other high cost
customers, and the cost of serving these customers is averaged with other
customers when rates were established. This is one example of a hidden
subsidy. This proceeding is investigating methods for making such subsidies
explicit, rather than hidden in the rates.
2000
ANNUAL REPORTPage 29 IDAHO PUBLIC UTILITIES COMMISSION
Idaho Telecommunications
Ensuring Markets Are Irreversibly Open
Prior to the federal Telecommunications Act of 1996, Qwest and
Verizon were restricted from carrying long distance calls outside their own
market areas or LATAs (Local Access Transport Area) . Such interLATA calls
were carried by other long distance companies. However, Verizon may now
carry both interLATA and intraLATA calls. Qwest remains restricted from
carrying interLATA calls until it can demonstrate that it has irreversibly opened
its market to competition for local exchange customers by complying with the
items specified on a checklist developed by the Federal Communications
Commission. The Commission is participating in three multi-state collaborative
proceedings to determine whether Qwest is in compliance with the checklist.
One is a thirteen-state effort to conduct a third-party test to determine
whether Qwest’s operational support systems (OSS) are open to competitors in
a non-discriminatory manner. This multi-million dollar test is being conducted by
KPMG Consulting, with Hewlett-Packard Consulting acting as a pseudo-
competitive company trying to place orders using Qwest’s OSS. Liberty
Consulting is conducting an audit of Qwest’s performance reporting procedures.
A second effort involving seven states is examining Qwest’s compliance
with the non-OSS related issues in the checklist.
The third effort, which was just beginning as the year covered by this
report ended, includes 12 states, and it will investigate the methods for ensuring
Qwest’s market opening efforts are maintained after it has obtained permission
to cross LATA boundaries.
Until the Commission determines that incumbent local exchange compa-
nies (ILEC) face effective competition throughout an exchange, basic local
exchange service provided by an ILEC to residential and small business custom-
ers remains under the Commission’s Title 61 rate-setting authority. US WEST
petitioned the Commission for such regulatory relief in the Burley exchange,
claiming that it faced effective competition from Project Mutual Telephone
Cooperative, as well as providers of wireless service. The Commission ruled, in
a split decision, that Qwest had failed to demonstrate it faced effective competi-
tion throughout the exchange.
IDAHO PUBLIC UTILITIES COMMISSION Page 302000
ANNUAL REPORT
Idaho Telecommunications
Idaho Telephone Service Assistance Program
The Idaho Telephone Service Assistance Program (ITSAP), commonly
referred to as a “lifeline” program, provides credits to low income households
to assist them in obtaining and maintaining telephone service. Because the value
of telephone service increases as more households have a telephone, a small
contribution from all non-participating households is used to fund this program.
In response to federal changes to the program, the Idaho Legislature opened the
program to all low income households.
The combined value of federal and state credits is $10.50 per month per
household. The state contribution to this amount is $3.50, with the federal
contribution covering the remaining $7.00. The Department of Health and
Welfare established and administers application procedures and eligibility
determinations. Utilities are provided a list of the telephone numbers for qualify-
ing households and automatically provide each household with the credits.
The Commission is responsible for maintaining the fund and reimbursing
the telephone companies for the cost of providing these credits. Based upon the
Department of Health & Welfare’s estimates of the number of households
eligible for the credits, the Commission established the monthly surcharge paid
by all telephone users, including wireless customers, at 5 cents per line effective
July 1, 1999.
The ITSAP surcharge is assessed on all residential, business, and
wireless end users. The gross surcharge revenue is netted against the assistance
credits paid to eligible customers and the company’s administrative costs. Gross
surcharge revenues collected by telecommunications companies during the year
totaled $588,904,of which $420,351(72%)was assessed on local exchange
services and $159,552 (28%)was assessed on wireless/cellular services. At the
start of the fiscal year, 15,139 households were participating in the program.
20,706 households received the credit in September 2000. The total value of
the credits received by Idaho households, including the federal match, was
$2,361,330.
ITSAP
Summary
Sept, 99 - Sept, 00
Credits Provided
Idaho Share
= $787,110
Federal Match
= $ 1,574,220
Total Value
of Credits
= $2,361,330
Fund Balance
As of 9/30/00
= $607,871
2000
ANNUAL REPORTPage 31 IDAHO PUBLIC UTILITIES COMMISSION
Idaho Telecommunications
Idaho’s Universal Service Fund
Telephone companies operating in Idaho have been required since July
1988 to contribute to a Universal Service Fund (USF) to ensure that the high
costs of small telephone companies do not result in rates that exceed the
statewide average by more than 25 percent. These local and long distance
companies are permitted to recover their contributions from local and long-
distance customers. Local exchange companies may apply for assistance from
this fund. They must submit proof to the Commission that when they set their
rates at 125% of the statewide average, they still do not fully recover their cost
of providing local service. The Commission evaluates the circumstances and
determines whether and for what amount the Company may receive Universal
Service Funds.
Long distance companies connecting in-state long distance calls in
Idaho are required to remit a 0.45 cent ($0.0045) surcharge for each in-state
long distance minute. Those companies are also required to submit periodic
reports detailing their minutes of in-state toll usage. Local exchange companies
are required to report and remit on a monthly basis 14 cents (residential) and
26 cents (business) for each line served.
Universal Service Fund Facts
July 1, 1999 ~ June 30 2000 Residential Business Toll Access
Statewide Average $17.31 $32.54 $0.0545
125% of Avg.$21.63 $40.68
Monthly Surcharge Rate $0.14/line $0.26/line
LD/WATS Surcharge Rate $0.0045/min
Fund Activity
Balance 6/30/99 $ 139,186
Collections Disbursements
Local Surcharge $1,311,584 ATC $509,866
Toll Surcharge $ 894,941 Cambridge $413,380
Total $2,206,526 Direct Comm $215,684
Fremont $417,425
Disbursements $2,212,761 Inland $ 55,161
Admin/Amort/Bank/ Midvale $195,021
Brkr $ 14,096 Rural $243,122
Interest $ 9,828 Silver Star $163,101
$2,212,761
Balance 6/30/00 $ 128,683
IDAHO PUBLIC UTILITIES COMMISSION Page 322000
ANNUAL REPORT
Idaho Telecommunications
TRS service is
available statewide
and may be reached by
voice by dialing
1-800-377-1363.
Contact with a
text-telephone
operator may be
made by dialing
1-800-377-3529.
Questions or
comments regarding
the use of TRS
may be directed
from either a
text or voice
telephone to
1-800-368-6185.
Idaho’s Telephone Relay ServiceIdaho’s Telephone Relay ServiceIdaho’s Telephone Relay ServiceIdaho’s Telephone Relay ServiceIdaho’s Telephone Relay Service
Idaho inaugurated telephone relay service (TRS) on Dec. 1, 1992 for the
hearing- and speech-impaired. TRS requirements were created by the Federal
Communications Commission under Title IV of the Americans with Disabilities
Act of 1990. The 1992 Idaho Legislature established the manner in which TRS
has been implemented.
Under Idaho rules, the Idaho Public Utilities Commission established a
seven-member telephone industry committee to help select and advise a TRS
administrator. In 1992, the Commission appointed Robert Dunbar as its first TRS
administrator.
This year, Mr. Dunbar consulted with representatives of the State Councils
for the Deaf, Hard-of-Hearing and Developmentally Disabled and with the Indus-
try Advisory Committee to formulate the invitation to bid for provision of the relay
service. The bid request was then approved by the IPUC. Hamilton Telephone
Co. of Aurora, Neb. was again selected to provide Idaho’s TRS.
A TRS call may be initiated by a text telephone user or a standard phone user.
The caller dials a toll free number to access the TRS center and reaches a Com-
munications Assistant (CA) who will process the call. The caller gives the CA the
number of the person to be called and the CA places the call to that person. The
CA will type to the person with the text telephone and speak to the person with the
standard phone, relaying exactly what is spoken/typed by each party.
“The idea is to allow as close to normal telephone service as possible for
hearing- and speech-impaired persons,” according to Dunbar.
While Idaho’s TRS operators are stationed in Nebraska, calls they handle
are billed point-to-point. Callers only pay the cost of the telephone call, as if the
call was placed directly between the telephones. Long distance calls are billed
based upon the points of origination and termination and many long distance com-
panies bill them on a reduced rate basis. No charge is assessed local calls.
TRS service is available statewide and may be reached by voice by dialing
1-800-377-1363. Contact with a text-telephone operator may be made by dial-
ing 1-800-377-3529. Questions or comments regarding the use of TRS may be
directed from either a text or voice telephone to 1-800-368-6185. Information
on Idaho’s TRS program is also available via the Internet at: http://
www.hamilton.net/relay/id/itrs.htm
Idaho is making plans to comply with the recent FCC mandate requiring TRS
access by simply dialing 7-1-1. While no conversion date has yet been estab-
lished, the PUC and industry leaders in Idaho hope to implement 7-1-1 access to
the Idaho TRS well before the FCC’s deadline of October 1, 2001.
In 1999, all Idaho local exchange companies were required to pay four
cents ($0.04) per access line per month, and in-state long distance companies
were required to pay $0.0007 per bill minute, to support the TRS.
2000
ANNUAL REPORTPage 33 IDAHO PUBLIC UTILITIES COMMISSION
Idaho Telecommunications
Company Status
Adelphia Bus. Solutions Operations, Inc.Approved 12/21/99
Advanced Telcom Group, Inc. (ATG)Approved 1/12/98 Cert. No. 354
AT&T Comm. of the Mtn. States Approved 8/27/96,
–Amendment of Certificate No. 295
Avista Communications of Idaho, Inc.Purchased Cert. #. 352 from One Eighty, 5/99
CCCID,Inc. d/b/a Connect!Approved 6/18/99, Cert. No. 359.
Choctaw Comm. dba Smoke Signals Comm.Approved 10/31/99, # 381
Citizens Communications Approved 1/27/97, Cert. No. 323
Comm South Companies, Inc Approved, Cert # 368
Concert Communications Sales Approved, 8/2/99, Cert. # 361
Convergent Comm. Svcs. Inc Approved, 6/5/00,
Crystal Communications, Inc.Approved 5/11/98, Cert. No.340.
C-Systems Inc (formerly Netlink)Approved 9/8/98, Cert. No. 349
CTC Telecom (Cambridge)Approved 8/10/98 Cert. No. 348
-CTL-T-99-1 (amendment) Amended, No. 348A 6/30/99
DPi Teleconnect LLC Approved, 4/7/00 Cert. #372
DSLnet Communications, Inc. Approved, 9/1/99, Cert. # 362
Electric Lightwave Approved 6/18/98 Cert No.344
Eclipse Communications, Inc.Approved 5/28/98, Cert. No. 346.
FIRSTEL, Inc.Approved 9/28/98, Cert. No. 350
Fretel Communications. LLC Approved, 1/5/00, Cert. # 370
Group Long Distance, Inc.Approved 1/6/98, Cert. No. 335
GST Telecom Approved 2/5/97 Cert No. 322
HighSpeed.Com, LLC;Approved 1/22/99 Cert. No. 355
HJN Telecom Approved, 1/28/99,
ICG Telecom Group, Inc.Approved 3/3/99 Cert. No. 356
Intellicall Operator Services, Inc.Approved 10/29/98; Cert No 351.
Jato Operating Two Corp.Approved, 12/14/99, Cert. # 367
LCI International Approved 6/18/98; Cert No. 343
Level 3 Communications, LLC.Approved 12/31/98 Cert No. 353
Maxcess, Inc.Approved, 6/15/00, Cert # 375
Certificated Local Exchange Carriers
as of 6/30/2000
IDAHO PUBLIC UTILITIES COMMISSION Page 342000
ANNUAL REPORT
Idaho Telecommunications
Company Status
MaxTel Communications Approved 9/4/97, Certificate Pending
MCI WorldCom Technologies, Inc.Approved 8/24/98 Cert. No, 347
MCImetro Access Transmission Services Approved 7/16/98, Cert.No.337
McLeod USA Telecommunications Approved 5/27/97; Cert. No. 325
MVX .COM Communications Inc.Approved, 10/27/99, Cert. # 366
Nextlink Idaho, Inc Approved, 9/1/99, Cert. # 363
One Eighty Communications, Inc.Approved 12/4/98, Cert No. 352
Pac-West Telecomm, Inc.Approved, 3/21/00, Cert. # 373
Preferred Carrier Services, Inc.Approved 6/24/99, Cert No. 359,
Quintelco, Inc.Approved 12/17/97; Cert No.342.
Rural Network Services Approved 4/23/99 Cert. No. 357
Sprint Communications Approved 7/2/97 Cert. No. 327
Sterling International Funding, Inc.Approved 1-6-98, Cert. No. 336
dba Reconex;
TEL-LINK LLC Approved 7-11-97, Cert. No. 326.
Tel-Save Inc. dba The Phone Company Approved 9/18/97 Cert. pending
Teltrust Communications Services Approved Order No. 27628 Cert No. 345
U.S. Long Distance Approved 11/10/97. Cert. No.341.
Certificated Local Exchange Carriers
as of 6/30/2000
Other Local Telecommunication Service Companies
Arrival Communications, Inc.
Bell Atlantic Network Data. Inc.
New Edge Networks, Inc.
01 Communications of Idaho
Pathnet, Inc.
Triad Communications of Idaho
Worldwide Fiber Networks, Inc.
The following companies applications for Certificates were withdrawn as the
local telecommunications services the companies intended to provide, typi-
cally high speed data services, do not require a certificate.
2000
ANNUAL REPORTPage 35 IDAHO PUBLIC UTILITIES COMMISSION
ATC
ATC was formed by the merger of Albion Telephone Company and
Westel. ATC serves the Albion communities of Albion, Almo, Elba, Malta
and Raft River southeast of Burley, and the Westel communities of Arco,
Moore, Howe, Holbrook, Mackay, and Malad. The company received
$509,866 of its 2000 revenue from the state Universal Service Fund.
Cambridge Telephone Company
Now including Council Telephone Company, Inc.
Cambridge Telephone Co.’s service area includes Cambridge,
Cuprum, Indian Valley, Lowman, and Council, now that its merger with
Council Telephone Company has been approved. Council Telephone Com-
pany was created by Cambridge to purchase the Council exchange from U S
WEST. Cambridge received $413,380 of its revenue from the state’s
Universal Service Fund, which is derived from a surcharge on all Idaho phone
bills. The USF enables high-cost companies, such as Cambridge, to keep
their rates at about 125-percent of the statewide average.
Case No. CAM-T-99-02, in which the merged Company sought
approval of an increase in rates and an extension of local calling areas, was
concluded after the period of this report.
12/21/99
Cambridge-Council Merger Approved
Case No. CAM-99-01, Order No. 28239
The Idaho Public Utilities Commission approved the application of
Cambridge and Council Telephone companies for a complete merger of the
two companies.
The Council phone company was created in 1996 when the Council
telephone exchange was purchased by Cambridge from US WEST. The
Council service was created as a wholly-owned subsidiary of Cambridge and
a three-year rate freeze was ordered by the PUC for Council customers. The
two phone companies asked for authority to fully merge their operations,
stressing that by doing so they will reduce operating costs associated with
dual bookkeeping and other services. Operations and control of the two
companies remained the same.
ATC
Residential = $24.10
Business = $42.00
Cambridge
Telephone Company
Ave. Residential Rate
= $24.10
Ave. Business Rate
= $42.00
Telecommunication Cases
IDAHO PUBLIC UTILITIES COMMISSION Page 362000
ANNUAL REPORT
Ave. Residential Rate
= $21.75
+ $3.50 rural adder
Ave. Business Rate
=$39.77
+ $3.50 rural adder
Telecommunication Cases
CenturyTel of Idaho, Inc.
CenturyTel of Idaho, Inc., with its headquarters in Louisiana, serves the
Salmon, North Fork and Leadore areas of the Salmon and Lemhi river valleys
near the Montana border. The company’s rates were rebalanced in 1999, in
compliance with the 1997 Legislative direction that required incumbent tele-
phone companies such as CenturyTel to remove “implicit subsidies” from local
rates.
May 3, 2000
CenturyTel Gets Approval To Change Local Phone Rates
Case No. CEN-T-99-4, Order No. 28340
Phone bills for some customers in the Salmon, Leadore and North
Fork areas of Northcentral Idaho went up, but bills for many others who have
paid extra for rural service went down, all a result of a decision by the Idaho
Public Utilities Commission.
These changes came from PUC approval of a request by CenturyTel of
Idaho – a unit of Century Tel, Inc – for a base residential monthly phone service
rate of $21.75, compared with previous monthly rates ranging from $15.20 to
$17.20. Business basic monthly rates raised to a uniform $39.77, from rates
ranging from about $29 to $36.
These changes in local monthly rates helped offset the Company’s
reduced revenue because of lower access rates charged to long distance
carriers for carrying intrastate calls. The PUC approval of the decreased long
distance fees resulted from state and federal mandates ending subsidies that had
inflated the access charges.
In addition, the Order complied with federal regulations and required all
customers to have single-line service which also allowed customers to have
features such as caller ID, last call return available, and allowed high-speed
data connections for Internet service.
Many customers paying a mileage surcharge for rural service actually
saw their total phone bills decrease with the PUC’s adoption of a flat $3.50
surcharge for the rural service in lieu of the mileage calculation that could have
added as much as $12 to a customer’s bill. In addition, customers who use the
phone infrequently have the option of signing up for a measured rate alternative
that reduced the monthly charge by $8.
2000
ANNUAL REPORTPage 37 IDAHO PUBLIC UTILITIES COMMISSION
Telecommunication Cases
CenturyTel of the Gem State, Inc.
CenturyTel of the Gem State, Inc., provides telephone service to about
1,700 customers in parts of Ada, Elmore, Lincoln and Blaine counties. This
Company’s rates were also rebalanced in 1999, along with the approval of
extended calling areas requested by its customers.
May 3, 2000
CenturyTel of the Gem State Gets PUC Nod To Expand
Toll-Free Calling Areas; Raise Local Rates
Case No CGS-T-99-4, Order No. 28340
Telephone customers of CenturyTel of the Gem State in the Richfield,
Grand View, Bruneau and Grasmere/Riddle areas of southern Idaho saw
expanded toll free dialing areas, but with higher local business and residential
service rates.
The Idaho Public Utilities Commission approved a request by
CenturyTel of the Gem State – a unit of Century Tel, Inc – to expand toll free
calling in two areas. First, customers in Richfield were approved to call toll free
to all communities in US West’s service areas in the Magic Valley. Secondly,
customers in Grand View, Bruneau and the Grasmere/Riddle areas were ap-
proved to call without charge to Mountain Home and US West exchanges in the
Treasure Valley, including Boise.
Changes in local monthly rates helped offset the Company’s reduced
revenue because of the expanded toll free calling areas and from lower access
charges for long-distance carriers. The Order noted that the phone companies’
access charges were among the highest in the state and clearly priced above
actual cost, and thus could be viewed as a form of subsidy. “By bringing the
…rate for its access charges down to levels approaching the statewide average,
the Companies’ proposal accomplishes much of what is required by Idaho
Code,” the order said.
Base residential monthly service is $24.10 per month. Business local
service rates are $39.77 per month. Measured rate alternatives to basic service
are available for customers who make fewer calls. Those rates are $8 less than
both basic residential and business service. The Order also implemented a
surcharge of $3.50 per month for rural service.
Ave. Residential Rate
= $24.10
+ $3.50 rural adder
Average Business
Rate
= $42.00
+ $3.50 rural adder
IDAHO PUBLIC UTILITIES COMMISSION Page 382000
ANNUAL REPORT
Telecommunication Cases
Ave. Residential Rate
= $17.50
Ave. Business Rate
= $35.10
Citizens Telecommunications Company of
Idaho
Citizens Telecommunications of Idaho is Idaho’s third largest local
telephone company, serving approximately 20,000 customers in Southern
Idaho. The company provides service in the areas of Homedale, Aberdeen
Carey, Fairfield, Marsing, Parma, Springfield, Wilder, Cascade, Donnelly, Elk
City, Garden Valley, Horseshoe Bend, McCall, New Meadows, Riggins, Sweet
and White Bird.
June 8, 2000
Customers To Benefit From PUC Approval Of
US WEST Sale Of Service To Citizens
Case Nos. USW-T-99-25, CTC-T-99-02, Order No. 28394
With major benefits accruing to phone-service patrons, the Idaho Public
Utilities Commission approved the sale of telephone service in the Lewiston-
Grangeville service area from U S WEST to Citizens Telecommunications Co.
As part of the transfer of service, which includes gains by U S WEST from the
sale of depreciated assets, the Commission noted that a portion of the profits U S
WEST will receive from the sale should be returned to the ratepayers.
As a result, customers in eight exchanges in the Lewiston-Grangeville
area will see a $7.5-million upgrade in digital switching equipment at Lewiston
and a freeze in local telephone rates for at least two years. In addition, a set-
aside of $4.94 million was ordered by the Commission to be used for possible
future programs that might include a contribution to the Universal Service Fund or
expansion of toll-free calling areas. The PUC noted it would seek additional
evidence in separate future proceedings before making a final decision on how to
use the settlement amount.
Citizens also agreed to spend some $27 million to upgrade facilities and
improve services during the first three years of ownership. “The evidence is that
this investment represents more improvement in the network than customers
would have realized under U S WEST’s continued ownership,” the Commission
said in its decision.
Citizens and U S WEST also entered into a transfer agreement to
minimize any disruptions to customers and to make the transition “as seamless as
possible.” This will include no interruptions in public safety services such as 911
and assumption by Citizens of existing customer accounts without asking custom-
ers to submit to credit verifications.
2000
ANNUAL REPORTPage 39 IDAHO PUBLIC UTILITIES COMMISSION
Telecommunication Cases
Fremont Telecom Company
This utility was created to purchase the St. Anthony, Ashton and Island
Park exchanges from U S WEST. It subsequently requested all remaining areas
of Fremont County that are currently unserved to be included in its service area.
Fremont is now the sole provider of wireline telecommunication services in
Fremont County. Fremont received $417,425 in assistance from the Idaho
Universal Service Fund in FY 2000.
Inland Telephone Company
Inland Telephone Co. serves about 300 customers, most of whom live
near Lenore on the Clearwater River, and some of whom reside at Leon - a
narrow strip of land in both Nez Perce and Latah counties on the Idaho side of
the state line east of Uniontown, Washington. About $55,161 of the company’s
annual revenue comes from Idaho’s Universal Service Fund.
April 20, 2000
Dialing Plan Gives Inland Customers Enhanced
Long Distance Choices
Case No INL-T-99-01, Order No. 28323
Customers of Inland Telephone Co. in northern Idaho found it easier to
use the long distance carrier of their choice, as a result of action taken by the
Idaho Public Utilities Commission. The Commission approved the plan submit-
ted by Inland for “equal access”, or “One Plus” dialing.
One Plus dialing is the ability to use the long distance carrier of choice,
simply by dialing 1 followed by 208 and number being called. Prior to equal
access, customers had to use a special dial-around code to reach any carrier
other than the designated carrier. With equal access, they are able to use their
desired carrier without dialing any special codes.
Inland, which serves the communities of Lenore and Leon, gave cus-
tomers 90 days to select the long-distance carrier to provide their “One-Plus”
dialing service. There was no charge for the initial carrier selection, if it was
placed before the end of the 90 day grace period identified by the company.
Customers may use the same carrier for both in-state and out-of-state calls, but
may choose a different carrier for in-state calls if desired.
Inland Telephone
Company
Ave. Residential Rate
= $14.55
Ave. Business Rate
= $22.50
Fremont Telcom
Company
Ave. Residential Rate
= $24.10
Ave. Business Rate
= $42.00
IDAHO PUBLIC UTILITIES COMMISSION Page 402000
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Telecommunication Cases
Ave. Residential Rate
= $14.80
Ave. Business Rate
= $22.50
Midvale Telephone Exchange
Now Includes Sawtooth Telephone Company
Midvale Telephone Exchange serves the Midvale area in Washington
County, and the Lakeview area on the east side of Lake Pend Oreille in Bonner
County. With the merger of Midvale and Sawtooth, a company created by
Midvale to purchase the Stanley exchange from U S WEST, Midvale added
the 900 customers in the Stanley exchange. The company received about
$195,021 of its annual revenue from the Idaho Universal Service Fund in FY
2000.
Case No. MID-T-99-01, in which the merged Company sought
approval of an increase in rates and an extension of local calling areas was
concluded after the period of this report.
Nov. 19, 1999
Midvale, Sawtooth Merger Approved
Case No. MID-T-99-02, SAW-T-99-02, Order No. 28233
The Idaho Public Utilities Commission approved the application of
Midvale Telephone Exchange and Sawtooth Telephone Company for a com-
plete merger of the two companies.
The Sawtooth Phone Company was created in 1996 when the Stanley
telephone exchange was purchased by Midvale from US WEST. The
Sawtooth service was created as a wholly owned subsidiary of Midvale.
Midvale provides phone service in the Midvale, Yellow Pine, Warren, Warm
Lake and Lakeside exchanges.
The two phone companies asked for authority to fully merge their
operations, stressing that by doing so they will reduce operating costs associ-
ated with dual bookkeeping and other services. Operations and control of the
two companies remained the same.
2000
ANNUAL REPORTPage 41 IDAHO PUBLIC UTILITIES COMMISSION
Telecommunication Cases
Feb. 1, 2000
Toll-Free Phone Service Between Yellow Pine/Warren
Exchanges And McCall, Cascade, And Warm Lake Denied
Case No. MID-T-98-1, Order No. 28263
A request by customers seeking extension of toll-free phone service
between the communities of Yellow Pine and Warren with the communities of
Cascade, McCall and Warm Lake was denied by the Idaho Public Utilities
Commission.
Telephone service in Yellow Pine and Warren is provided by Midvale
Telephone Co. and in Cascade, McCall and Warm Lake by Citizens Telephone
Co.
The commission ruled that there was insufficient “community-of-interest”
relationships between the two locales to justify raising customer rates in those
exchanges to cover the costs of providing toll free calling between them.
Verizon Northwest, Inc.
Verizon Northwest (formerly GTE Northwest) serves more than
125,000 Idaho customer access lines, making it the second largest telephone
utility in the state. With the merger of its parent corporation GTE, with Bell
Atlantic, the combined company was renamed Verizon. Verizon Northwest’s
service area includes most of the Idaho Panhandle north of Lewiston, as well as
parts of western Montana, eastern Washington, Oregon and northern California.
Major population centers in Idaho served by Verizon include Coeur d’Alene,
Moscow, Sandpoint and the Silver Valley.
Ave. Residential Rate
= $18.50
Ave. Business Rate
= $36.06
IDAHO PUBLIC UTILITIES COMMISSION Page 422000
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Telecommunication Cases
Pine Telephone
System
Ave. Residential Rate
= $7.89
Ave. Business Rate
= $11.50
Ave. Residential Rate
= $24.10
Ave. Business Rate
= $42.00
Teton Communica-
tions
Ave. Residential Rate
= $24.10
Ave. Business Rate
= $42.00
Oregon-Idaho Utilities, Inc.
In August 1992, the Commission approved the transfer of Contel’s
South Mountain exchange in Owyhee County to Oregon-Idaho Utilities. The
South Mountain exchange serves Silver City, the Delmar Mines and surround-
ing areas. It was transferred to Oregon-Idaho Utilities, Inc. along with several
southeastern Oregon exchanges operated by Contel of the West. Acquisition
of Contel’s South Mountain and southeastern Oregon exchanges was Oregon-
Idaho’s first venture in running a local exchange company. The utility currently
has approximately 65 access lines in Idaho.
Pine Telephone System, Inc.
Pine Telephone System, Inc. serves two customers and a number of
payphones in an area near Idaho Power Co.’s Brownlee Reservoir complex on
the Snake River between Idaho and Oregon.
Silver Star Telephone Company
Silver Star serves the eastern portion of Bonneville and Caribou coun-
ties near the Wyoming border. The company receives $163,101 of its annual
revenue from the state Universal Service Fund.
Teton Communications
This new utility is affiliated with Silver Star Telephone Co. and was
formed to purchase the Driggs exchange from U S WEST Communications.
Ave. Residential Rate
= $15.77
Ave. Business Rate
= $26.51
2000
ANNUAL REPORTPage 43 IDAHO PUBLIC UTILITIES COMMISSION
Telecommunication Cases
Rural Telephone Company
Rural Telephone Co. serves a little more than 500 customers in several
remote areas of Idaho. The company operates in the Three Creek area of Twin
Falls and Owyhee counties, the Shoup area in Lemhi County and in the Atlanta,
Pine, Featherville and Tipanuk areas of Elmore County. Rural received
$243,122 of its FY 2000 revenue from the Idaho Universal Service Fund.
August 20, 1999
Increased Local Calling Area and Higher Rates Approved
For Rural Telephone Customers
Case No. GNR-T-97-09, Order No. 28415
Customers of Rural Telephone Company in the Tipanuk, Prarie, Pine
and Featherville areas will be able to make toll free calls to the Treasure Valley,
but also have an increase in their monthly local rates, as a result of changes
approved by the Idaho Public Utilities Commission. Local rates for these
customers will increase to $24.10 per month for residential customers, and
$42.00 per month for business customers.
Customers in the Atlanta area had also requested toll free calling into the
Treasure Valley, but the Commission found insufficient community of interest
between that small isolated mountain community and the Treasure Valley to
justify the increased cost of extended area service. Most of that cost would be
born by the Universal Service Fund and not the local ratepayers.
Rural Telephone Company, which serves some of the more remote and
costly areas of the state, receives financial assistance from Idaho’s Universal
Service Fund, to make service in these high cost areas affordable. To remain
eligible for this assistance, rates for all Rural customers were to increase to
125% of the statewide average, or nearly $22 per month for residential custom-
ers. The Company informed the Commission that it would be December of
2000 before the construction necessary for the changes could be completed.
Direct Communications
The merger between Direct Communications Lakeside and Direct
Communications Rockland resulted in Direct Communications. The merged
company serves the Rockland-Arbon Valley area of southeastern Idaho,
primarily in Power County, as well as the Paris exchange previously served by
U S WEST. The company received $203,358 of its FY2000 revenue from the
state Universal Service Fund.
Ave. Residential Rate
= $14.80
Ave. Business Rate
= $20.00
Direct
Communications
Ave. Residential Rate
= $24.10
Ave. Business Rate
= $42.00
IDAHO PUBLIC UTILITIES COMMISSION Page 442000
ANNUAL REPORT
U S WEST South
Ave. Residential Rate
= $16.97
Ave. Business Rate
= $31.74
U S WEST North
Ave. Residential Rate
= $15.43
Ave. Business Rate
= $29.25
Telecommunication Cases
Potlatch Telephone Company
Potlatch Telephone Co., a subsidiary of TDS Telecom, serves more
than 1,100 customers in the Juliaetta and Kendrick area near the Potlatch River
in northern Idaho.
Troy Telephone Company
Troy Telephone Co., a subsidiary of TDS Telecom, serves more than
900 customers in the Troy area near Moscow.
Qwest Communications, Inc
Qwest , formerly U S WEST, has two operating companies in Idaho.
The name change came from the merger of its parent corporation, U S WEST,
the smallest of the original baby bell operating companies, with Qwest, the
nations fourth largest long distance company. The South Idaho operating
company, the largest of the two, provides service to nearly 500,000 residential
and business lines. These exchanges were previously served by U S WEST’s
Mountain Bell operating company. Qwest North includes the communities
previously served by the Pacific Northwest Bell operating company. It includes
the customers between Grangeville and Lewiston. Qwest’s North Idaho
service area is being sold to Citizens.
June 29, 2000
U S WEST FILES TERMS OF AVAILABILITY FOR
CONNECTING WITH OTHER UTILITIES
Case No. USW-T-00-15
U S WEST has filed with the Idaho Public Utilities Commission its
“Statement of Generally Available Terms” (SGAT) which outlines the terms and
conditions that it requires for other phone companies to interconnect with it.
Included in the SGAT are U S WEST’s terms and conditions for
interconnection, access to unbundled network elements, ancillary services and
resale of U S WEST’s telecommunications services.
Ave. Residential Rate
= $12.67
Ave. Business Rate
= $19.00
Ave. Residential Rate
= $11.33
Ave. Business Rate
= $17.65
2000
ANNUAL REPORTPage 45 IDAHO PUBLIC UTILITIES COMMISSION
Telecommunication Cases
May 3, 2000
U S WEST REQUEST FOR DEREGULATED
BURLEY PHONE EXCHANGE RATES DENIED
Case No. USW-T-99-15, Order No 28369
The Idaho Public Utilities Commission denied an Application by U S
WEST for deregulated phone rates in the Burley exchange, contending the
utility’s case falls short of showing that effective competition exists throughout
the local exchange calling area.
In a 2-1 decision, the Commission majority said, “We find that the
evidence in this record does not satisfy the legislature’s intent for the level of
competition required to mandate deregulation of basic service rates.” Commis-
sioners Dennis Hansen and Paul Kjellander wrote the majority decision.
The Commission majority pointed to Idaho Code which requires that
actual competition from a facilities-based competitor is present for both residen-
tial and small business customers and that “there are functionally equivalent,
competitively priced local services reasonably available to both residential and
small business customers.” The code references the intent of the Idaho Legisla-
ture “that effective competition throughout a local exchange calling area will
involve a significant number of customers having both service provider and
service option choices and that actual competition means more than the mere
presence of a competitor.”
Commissioner Marsha Smith dissented in the case, saying, “by rejecting
this Application outright, the majority denies competitive forces an opportunity
to operate in the Burley exchange.”
U S WEST’s Application was the first time a company had sought price
deregulation under a law passed by the Idaho Legislature.
June 12, 2000
PUC MAJORITY DENIES U S WEST REQUEST TO
RECONSIDER BURLEY PHONE DECISION
Case No. USW-T-99-15, Decision No. 28407
An appeal by U S WEST to the Idaho Public Utilities Commission to
reconsider its earlier decision denying the phone utility’s Application to deregu-
late rates in the Burley area was rejected by the PUC.
In a 2-1 decision the Commission majority said that U S WEST had
failed to present any new issue, or point to any mistake in the law the Commis-
sion had made. The majority opinion concluded that the utility was merely
disagreeing with the commission’s application of the law. Commissioners Dennis
Hansen and Paul Kjellander voted to deny the reconsideration request.
Commissioner Marsha Smith reaffirmed her dissent in the original
decision.
Telecommunication Cases
Other Telecommunications Cases:
April 25, 2000
IPUC Orders 17 Long-Distance Carriers To Halt
Conducting Business In Idaho
Case Nos. GNR-U-00-2, GNR-U-00-3, GNR-U-00-4
Order Nos. 28336, 28334 and 28343
Seventeen long-distance telephone companies were ordered by the
Idaho Public Utilities Commission to stop doing business in the state for violat-
ing state law and commission rules.
The 17 companies include: Accutel Communications, Inc., Atlas Equity,
Inc. doing business as Performance Telecom, Host Network, Inc., Long
Distance Direct, Inc., Pride America, Inc., Phoneco, Inc. doing business as
Network Services Long Distance, Voice Telephone Co., STA Telecommunica-
tions Corp., VIP Telephone Network, Inc., Trans National Communications,
Inc., Group III Services, Western Telecommunications Inc. doing business as
People Link, Call Plus, Inc., Dolphin USA, Inc., LD Network Service, Inc.,
North American Communication Group, Inc., and Partners in Communication.
Another company named earlier in a show-cause order, 1- Plus Savings,
voluntarily ceased operating within Idaho.
The PUC order directed local telephone exchanges to not accept long-
distance traffic from the long-distance carriers. Idaho law requires long-distance
carriers to pay regulatory fees, in this case amounting to $50 annually, and to
report yearly revenue from intrastate telephone traffic. Earlier this year, the
companies had been ordered at a PUC hearing to show cause why they had
not met the regulatory requirements. None of the companies appeared at the
hearing.
The commission order noted that it is unreasonable for these companies
to be allowed to operate in Idaho without paying regulatory fees. Failure to
report gross intrastate operating revenue and to pay their fees unfairly burdens
the remaining companies that are in compliance with the law, the Commission
said.
Telecommunication Utilities Under
IPUC Jurisdiction
ATC
P.O.Box 98
Albion, Idaho 83311-0098
208/675-5335
Cambridge Telephone Company
P.O.Box 86
Cambridge, Idaho 83610-0086
208/257-3314
CenturyTel of Idaho, Inc.
P.O.Box 1007
Salmon, Idaho 83467
208/756-3300
CenturyTel of the Gem State, Inc.
P.O.Box 9901
805 Broadway
Vancouver, Washington 98668
360/905-5800
111 A Street
Cheney, Washington 99114
509/235-3170
Citizens Telecommunications
Company of Idaho
4 Triad Center, Suite 220
Salt Lake City, Utah 84180
801/321-6602
P.O.Box 926
201 Lenora Street
McCall, Idaho 83638
208/634-6150
Inland Telephone Company
103 South Second Street
P.O.Box 171
Roslyn, Washington 98941
509/649-2211
Fremont Telecom, Inc.
110 E. Main Street
St. Anthony, Idaho 83445
208/624-7300
Midvale Telephone Exchange, Inc.
P.O.Box 7
Midvale, Idaho 83645-0007
208/355-2211
Verizon Northwest, Inc.
17933 N.W. Evergreen Parkway
P.O.Box 1100
Beaverton, Oregon 97075
503/629-2281
208/765-4351 (Coeur d’Alene)
800/483-4100 (Moscow)
208/263-0557, Ext. 204 (Sandpoint)
Oregon-Idaho Utilities, Inc.
P.O.Box 190310
Rincon Station
San Francisco, California 94119-0310
415/597-7811
714 Main Street
P.O.Box 1406
Caldwell, Idaho 83605
208/454-7800
Pine Telephone System, Inc.
P.O.Box 706
Halfway, Oregon 97834
541/742-2201
Potlatch Telephone Company
P.O.Box 138
702 E. Main Street
Kendrick, Idaho 83537-0138
208/835-2211
Rockland Telephone Company, Inc.
P.O.Box 269
147 W. 4th Avenue
Rockland, Idaho 83271
208/548-2345
Rural Telephone Company
704 W. Madison Avenue
Glenns Ferry, Idaho 83623
208/366-2614
Silver Star Telephone Company,
Inc.
P.O.Box 226
Freedom, Wyoming 83120
307/883-2411
Troy Telephone Company
P.O.Box 138
702 E. Main Street
Kendrick, Idaho 83837-0138
208/835-2211
Teton Telecom Communications
P.O.Box 900
Driggs, Idaho 83422
208/354-3300
Qwest Communications
North and South Idaho
P.O.Box 7888 (83723)
999 Main Street
Boise, Idaho 83702
800/244-1111
IDAHO PUBLIC UTILITIES COMMISSION Page 48
2000
ANNUAL REPORT