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Home My WebLink About19920615.docx MINUTES OF DECISION MEETING June 15, 1992 - 1:30 p.m. In attendance were: Commissioners Marsha H. Smith, Joe Miller and Ralph Nelson and staff members Mike Gilmore, Scott Woodbury, Lori Mann, Jim Long, Belinda Anderson, Birdelle Brown, Randy Lobb, Bill Eastlake, Gary Richardson, Brad Purdy, Don Howell, Allan Killian, Syd Lansing, Keith Hessing, Dave Schunke and Myrna Walters. Also in attendance were John Souba of U. S. West and petitioners of Albion Telephone Company including Lynn Steadman. Commissioner Smith opened the meeting. First matter considered was the Regulated Carrier Division Agenda dated June 15, 1992. Commissioner Nelson moved approval of the item. Other Commissioners concurred. 2. Don Howell's June 12, 1992 Decision Memorandum re: Union Pacific's Request to Close Various Freight Agencies, Case No. UP-RR-91-3. Commissioner Smith suggested closing Soda Springs and Boise. Commissioner Miller asked - on Soda Springs, wasn't there testimony from the Simplot facility that Soda Springs was useful? Commissioner Smith said - but they moved the switch point to Montpelier. They still have an agent in Montpelier. Don Howell said the Railroad withdrew closing Montpelier. No one commented on Soda Springs. Commissioner Nelson said he would hold consolidated hearing on Nampa and Aberdeen. Commissioner Miller asked - have one hearing for both cases? Don Howell said that suggestion was just for the Commissioners' convenience. Commissioner Miller said - can be consolidated into one case but have to go to both places. Doesn't matter about the case caption. Commissioner Smith asked - want prefile from the company? -2- Commissioner Miller said yes. Questions raised by Labor Board and Wheat Commission should be responded to with witnesses that we could ask questions of. **Commissioner Smith said it will be a real hearing. Commissioner Miller said he would be pleased with a witness who answers something rather than saying - I don't know. 12. Intermountain Gas Company Annual Tracker - INT-G-92-2: Decision Memorandum dated May 28, 1992 from Scott Woodbury and Madonna Faunce, Intervention of Northwest Industrial Gas Users and Staff and company stipulation. Scott Woodbury said this had been on the agenda before. Staff and Company were urged to discuss it. Have since entered into a Memorandum of Understanding. Now Northwest Industrial Gas Users have petitioned to intervene and want to look at the filing. Have talked to their attorney and it revolves around timing of payment - industrials want to be able to pay it over 12 months. They will file their comments Wednesday. Asked that it be set over until next Wednesday. **Mike McGrath of Intermountain Gas Company was in attendance at this time. Said IGC has no problem with payment over 12 months. **Matter will be held at this time. 20. Lori Mann's June 11, 1992 Decision Memorandum re: Petition for EAS Between Albion Telephone Company and U. S. West's Burley Exchange--Case Nos. ALB-T-89-2 and MTB-T-89-9. Commissioner Nelson, case chairman led the discussion. Said in the April 29 hearing, Commission was able to get down to specific recommendations and objectives from the parties. One, of course, was to grant EAS between the two, which was the proposal of staff. That would require using revenue-sharing funds from U. S. West and USF funds from the State USF for Albion's reimbursements. Lori Mann clarified - it won't require revenue-sharing money. Commissioner Nelson said there were other proposals (he listed those). One he was in favor of was the credit method where after customer paid a certain amount, received a 35% discount against monthly bill. That would create a fairly large bill payable. -3- Commissioner Miller said at some point Belinda Anderson was asked whether the USF support necessary for that method would end up being the same as granting EAS and it was never answered. It raised in his mind the cost of the proposal. Couldn't find where we quantified that or if it is capable of being quantified. There was one suggestion that if you did it it would require as much USF money as if you gave EAS. Was that quantified? Belinda Anderson said it wasn't quantified. Commissioner Miller asked - would be quantified if you did cap it at monthly? Belinda Anderson said it would be the total amount of the LEC bill times the number of people eligible times 12. Commissioner Nelson asked - stimulation didn't create further shortfall, did it? Belinda Anderson said it could. It would depend on how many subscribed to U. S. West and other one pluses.. **Lynn Anderson was in attendance at this time. Commissioner Nelson said 35% discount gets it below the access charge. Albion gets an access charge on all calls. Belinda Anderson said Albion makes money on each call. Commissioner Nelson asked - are they making 35% on the call? **Discussed what Albion is getting. This route accounts for about 40% of their intrastate revenue. Commissioner Nelson commented - so the stimulation will help them. Commissioner Smith said which means the USF kicks in more. You are not reducing Albion's rate on those calls. They are going to make the same on each call. Commissioner Miller said - and if the LEC credit is not capped, it gets difficult to approach but could be close to what EAS would cost. Thought it was one of the most difficult cases we have had to deal with in recent times. His concern is high toll calls -4- for rural customers. Think it is an impediment to growth. It is an impediment to social growth. There should be some way to solve that problem and that is why he initially thought Commission should use this case to seriously address the problem. When we get further into it, think it is not the best case to try and devise any overall policy on how to solve this problem. It is unique because it involves two companies and because of extremely high access revenue that Albion derives from this route. Is also unique because somehow it was reported to the Commission that by the time of our second hearing, the community sentiment was about evenly divided. It didn't appear to be an 80 or 90% desire for the program. Recognizing some would be disadvantaged by EAS and smaller number would be advantaged. Given those circumstances, guess he was inclined to stay with the decision to not do EAS, not withstanding his wish to somehow solve the problem. With respect to discount plans, the SHOTS programs had the advantage of appealing to almost no one. They had almost no support and don't appear to meet anyone's needs and created a number of additional problems. The LEC discount plan had some appeal because it did appear to be a solution to some people's problems. The inability to know what the price would be makes it a risk and even if its capped, you still have to consider the question of the effect on other competitive carriers. Difficulty we have in the Southern Idaho Lata is we are in this transition when we are moving to more competitive markets with more and more providers who will provide different packages and over time, multiple providers will result in packages that meet peoples needs. So the problem during this transition is, do you ride out the transition or do you take some step that impedes us from getting there, which EAS would do and testimony supporting any discount plan would give an advantage. The real problem in southern Idaho Lata is that the Commission has lost the ability to compel U S West to provide discount toll plans. Would like to do that but don't have that ability. Seems to him over time we have to solve the problem of access charges to make it possible for end-providers to enter these markets. Those are the tools the legislature has left us with. Whether we like it or not, that is the structure the legislature has created in this market. His inclination is reluctantly to deny the EAS petition and at this time not to implement any of the proposed discount plans. Based on his prior opinion, reach that reluctantly but is the only conclusion he could come to right now. Commissioner Nelson asked - you would not be in favor of the credit plan either? Commissioner Miller said no. -5- Commissioner Nelson said one of the problems is we are asked to respond to forces outside our jurisdiction. Much of the money is from interstate pools that get disturbed everytime you do EAS. While that shouldn't be the factor, is a big number to make up. That is the general problem he was having with some of the EAS petitions before the Commission. Are being asked to take care of worthwhile situations but we have no control over the distribution of the money. Commissioner Miller said for every wrong there has to be a remedy. It is frustrating when the tools aren't adequate to solve a problem. Commissioner Smith said we are legally obligated to deal with the money aspect. Commissioner Nelson said one of the things he liked about the credit plan is it maintains the interstate pool and still gives the customer a better deal than he has today. Guess these are always tough situations when you have services involved that you can't get to. Think we have at least tried to address some of these. The school has an FX line. Credit is something we can do and at least have a fair handle on it. Commissioner Miller asked - you would cap it? Commissioner Nelson said he would revisit it in a year instead. Don't know if 35% discount would stimulate a lot. Look at his bill of $60 and wonder what is normal. Commissioner Smith said her one comment on Page 6 is she is tired of fictional pricing. Don't want to create another fictional rate. Seemed to her we were creating another complication into the calculation of the rates of the bills. This is just another complication in that whole process. Another deviation from the normal. Think it is poor policy. Said Commissioner Miller said we previously had the tools and we used them and we don't have the tools anymore. What we are left with is competition. It is slow in coming. Am a skeptic but this is what we have to work with. Would like to encourage companies to be in the market. Was her impression that the toll rates had been reduced. Belinda Anderson said there was a small reduction. John Souba of U. S. West said there will be reductions in the mileage bands in September. -6- Commissioner Smith said it looked to her like people's bills were getting larger because useage has increased. Her preference instead of fooling around with these plans, seems like it would be cleaner to do EAS. But it would hurt the percentage of customers in the less than 10 calls per month category. This is a serious problem, don't know if we will find the answer because we have a whole bunch of these cases coming up. But right now don't see that these are better answers and can't go with EAS. Commissioner Nelson said he couldn't either. Asked if the rate will go from 93 to 90? Commissioner Miller said he thought Commission had to concentrate on what it has authority over. One is access rates. Think Commissioners have to seriously consider one plus equal access which he thought was the major impediment. One plus equal would be great. Testimony in the case was that people now are ready to use the complicated dialing but with one plus dialing that would be a small contribution toward attracting other carriers. Maybe when we look back at this we will decide that this approach isn't going to work and we will have to sometime in the future come back to it. Commissioner Smith said another concern she had is we just had the Buhl case and if we instituted some kind of program here, would want to go back and see if its appropriate for them now. Seemed to her the price tag drawing from the USF for similarly situated, would quickly run you into an amount that would put the whole program in jeopardy. That is a big concern. Commissioner Nelson said he wouldn't put the Buhl case in the same light as this case. Commissioner Smith said if we did it here there would be other communities. If we use USF and applied this across both uniformly we would quickly be in a position to raise USF charges. Commissioner Miller said another factor we considered in the "in-camera" session was the general drift of which was to give some idea to how the calling patterns were derived, the general import of which was to attempt to establish that the number of people who would immediately benefit from EAS was small in comparison to others who were not if you just looked at existing patterns; in that regard, all the parties to the case agreed that that information was priority and when we were doing that, think I kind of dropped the ball, and just because everyone agrees it is priority, shouldn't -7- just accept that. Commission should make a finding that that is a trade secret and keep it from the public. Went back and read the exhibit and that portion of the transcript and in his mind it is a close question as to whether it would be a trade secret. Would like to consider some procedure by which we make a decision on whether or not that part of the transcript should remain sealed so anyone who wants to see it could. Would like to consider some procedure if the parties do give us information to let us make our own decision on whether or not that is trade secret. Assume it could be done by briefs. Commissioner Nelson said he would also like that. Commissioner Smith said it would be beneficial to give parties an opportunity to tell us why its priority. Commissioner Miller said unless its truly a trade secret, people should be allowed to see what we see. Commissioner Smith asked Lori Mann what kind of a procedure they would like? Think it is important that we independently come to the conclusion that it does qualify as priority information send-off. Will do it if its really necessary but they need to convince Commissioners. Also, in U. S. West's testimony they made the argument that if Albion was going to be a toll carrier there was this question of 61 or 62. Thought this was not true. Without allegation by the company, there is no division into those categories. It is totally beyond the pale. If we were to adopt their position, we would always have to do cost allocation for each case. Don't think that was what was intended at all. If the company didn't make a allegation, we don't go through this discussion. Commissioner Miller commented what it takes to constitute a frivolous argument. This was clearly not frivolous. Butg it wasn't motivated by evil intent. It wouldn't pass the "empty head" argument. Lori Mann asked if Commissioners wanted an order to wait for briefs? Commissioner Smith said no. Order can outline procedure on confidentiality. **Will propose briefing schedule in the order. -8- Mr. Steadman asked to say a few words. Said at the hearing talked about competition, Albion was asked if they would be willing to install equipment for one plus and they said they would not unless ordered by the Commission. Said Commissioners have all mentioned it. Commissioner Smith said that is what Commissioner Miller was talking about when he spoke to equal access. Commissioner Miller responded. Said he didn't think Commission could do it in this case. We can only consider the issues identified. Don't think we can do it here but was personally interested in going down that road for southern Idaho. **Randy Lobb, Terri Carlock and Don Oliason were in attendance at this time. 3. Bill Eastlake's June 5, 1992 Decision Memorandum re: UPL-E-92-3 - Discounted Prepayment of Loans. Terri Carlock spoke to the company's response to the decision memorandum. Bill Eastlake explained the percentages. They are saying they need to collect on these loans now. Terri Carlock said the main point is it is a revenue neutral proposal. Commissioner Miller said Bill's point is we don't let the discount go below 30% to adhere to the initial point. Bill Eastlake responded. Said it is simply a matter of principle. Commissioner Miller said he would suggest approving the program as proposed and modified with the 30% limit as suggested by Bill Eastlake. Bill Eastlake explained the way the company arrived at the discounts. Commissioner Nelson suggested going with Bill's recommendation and if company wants to come in next year they can. Okayed. -9- 4. Bev Barker's June 8, 1992 Decision Memorandum re: Appointment to Vacant Seat on TRS Industry Committee. Commissioner Smith said her suggestion was to appoint Sprint and then write to Ted Judd and say these seats will rotate. Commissioner Miller said Sprint has degree of national experience and we should take advantage of that. **Appointment should be by order. Commissioner Smith suggested putting in wording about periodically appointing new members. Said other advantage Sprint has is they will be a potential bidder. 5. Jim Long's June 8, 1992 Decision Memorandum re: Advice from Inland Telephone Company, Midvale Telephone Exchange, Inc., etc. to change ITAP tariff language. Approved. 6. Jim Long's June 8, 1992 Decision Memorandum re: Advice from Rural Telephone Company to update their ITAP surcharge and change associated tariff language. Approved. 8. Randy Lobb's June 10, 1992 Decision Memorandum re: Holly Corporation Tariff Revision No. 5. Approved. 9. Birdelle Brown's June 10, 1992 Decision Memorandum re: Contel Advice 92-02 - Call Restriction Service to Block Certain Calls. Commissioner Nelson and Commissioner Smith said okay. Commissioner Miller thought this had come up before. Birdelle Brown reviewed the order telling companies to provide blocking as it becomes available. Commissioner Miller then concurred. 10. Brad Purdy's June 11, 1992 Decision Memorandum re: Case No. WWP-E-92-2. Commissioners would like this matter tabled until June 29. Commissioner Miller asked for engineering to respond to spiking, etc. -10- Commissioner Smith asked - how will WWP know what the intent of the useage will be and how will they enforce it? Don Oliason responded. Item will be held until June 29 Decision Meeting. 11. Brad Purdy's June 12, 1992 Decision Memorandum re: Case No. IPC-E-92-11. Commissioner Smith asked how did they get all these agreements out of these people? Commissioner Miller said on those issues, thought we should say something to the effect that it is difficult for us to predict whether those guarantees will be successful or not and if not the company is at risk for any liability that could occur and that by approving the transaction we are not in any way indicating that if they incur any additional liability that we would put those in Idaho Power rates. Other Commissioners said to say they are not prejudging it. Commissioner Nelson asked if Idaho Power Company Schedule 24 deals with rates? Keith Hessing said 24 is irrigation. Responded about the schedule numbers. Bev Barker said the Schedule 24 which applies to Prairie POwer is the same as IPC's Schedule 24. Only difference is the price. Talked to company about both being Schedule 24. Discussed the numbering of the schedules. Commissioner Smith asked if it wouldn't have been easier to assign an unused number and make notation on existing 24? Commissioner Nelson said he thought we should encourage them to use a number schedule. Commissioner Smith said to tell them to fix the schedule numbers. **Everything else was okay. Commissioner Miller asked about Zane Harrison's concerns. Brad Purdy responded. -11- 13. WWP-E-92-4; IPC-E-92-15; UPL-E-92-4 and PPL-E-92-1 - Annual revised and updated calculation of the adjustable portion of the avoided cost rate - Proposed Order in lieu of a decision memorandum, to follow. Scott Woodbury said this is the annual update. Last year when we did this we put it out in summary fashion and Peter Richardson and a number of other parties asked for reconsideration. We worked it all the way through and the rates stayed the same. Everyone that was a party to this received the calculations. The utilities were provided with staff's proposal. Have written notice from all utilities that the schedules are acceptable. Only fly in the ointment is that we have two adjustments in-house presently for Idaho Power Company. One is the trigger case and this one. The schedule for Idaho Power does include adjustments for the trigger case. **Commissioners just had editing changes. 14. Terri Carlock's June 11, 1992 Decision Memorandum re: Idaho Power Company's Application requesting approval to assume Prairie Power Rural Cooperative Notes; Case No. IPC-E-92-12. Commissioner Nelson moved approval. Other commissioners concurred. 15. Terri Carlock's June 12, 1992 Decision Memorandum re: Idaho Power Company - Stock Issuance; Case No. IPC-E-92-13. Approved. 16. Terri Carlock's June 12, 1992 Decision Memorandum re: Intermountain Gas Company's Request for Authority to Issue and Sell Securities; Case No. INT-G-92-3. Approved. 17. Terri Carlock's June 12, 1992 Decision Memorandum re: Pacificorp's Supplemental Application for $5,000,000 in Debt; Case No. PAC-S-92-1. Approved. -12- 18. Terri Carlock's June 12, 1992 Decision Memorandum re: Pacificorp's Request to Issue and Exchange Not More Than $100,000,000 of its Auction Rate Preferred Stock; Case No. PAC-S-92-2. Approved. 19. Terri Carlock's June 12, 1992 Decision Memorandum re: Pacificorp's Request to Issue Not More Than $500,000,000 in Short-Term Debt; Case No. PAC-S-92-3. Approved. 21. Lori Mann's June 12, 1992 Decision Memorandum re: Midvale Telephone's Application to Serve Yellow Pine, Warm Lake and Warren/Burgdorf: Case No. MID-T-89-1. Commissioner Miller said he didn't know if we could divest GTE of territory in a Midvale application. **GTE says if the Commission orders it, okay. Commissioner Nelson said originally there was the issue of how they did serve. **Jack Taylor was in attendance at this time. Randy Lobb originally raised issues of siting, etc. Had suggested temporary certificate, but Hendershot thought there would be problems with conditional approval (with the REA financing). Approved application. 7. Nancy Harman's June 9, 1992 Decision Memorandum re: Sunbeam Water Company. Jack Taylor said last January their water master came in and did the annual reports. Asked him about property tax payments. At the end of 1988 there was a big bank account. All the money has disappeared. Probably one of the reasons Parrish hasn't done anything is he says there is no money. Commissioner Smith said she personally couldn't accept Rodney's Parrish's statements. Think we should have a hearing, can't avoid it. Commissioner Miller said he didn't know what we could do that other agencies haven't done. Nancy Harman explained that this all came about as a phone complaint. -13- Beverly Barker said if there is a water quality problem, they should at least let their customers know about it. Commissioner Miller said that is a DEQ requirement also. Is there something else we can do to improve the situation? Can't change these people. Commissioner Smith said she wouldn't do anything without something in writing. Commissioner Miller said he thought staff had done a good job of getting information to the Commissioners and think it would be worthwhile for Nancy Harman to follow up and see if the DEQ people and EPA can achieve compliance and if theres anything we can add, threaten to lift the certificate, etc., but hate to charge off where other agencies already are. His suggestion would be that Nancy keep Commissioners informed of the enforcement compliance and if it becomes apparent we can do something over and above what these people have done, we will do it, but not now. **Nancy Harman is to keep in touch with the complainant. Meeting adjourned. The above minutes were transcribed from notes taken by me, Myrna Walters, Commission Secretary. I therefore sign them as the official minutes of the decision meeting. Dated at Boise, Idaho, this 13th day of August, 1992. Myrna J. Walters Commission Secretary 0110M