19990301_1.docx

MINUTES OF DECISION MEETING
March 1, 1999 - 1:30 p.m.
In attendance were Commissioners Dennis Hansen, Marsha H. Smith and Paul Kjellander and staff members Don Howell, Brad Purdy, Weldon Stutzman,  Wayne Hart, Brad Purdy, Birdelle Brown, Carolee Hall, Bob Horton, Joe Cusick, Stephanie Miller, Rick Sterling, Ron Law, Doug Cooley, David Scott, Keith Hessing and Myrna Walters. Also in attendance were John Souba of U S West and Bob Dunbar, Administrator of the TRS.  
Commissioner President Dennis Hansen called the decision meeting to order. Items from the published March 1, 1999 Agenda were discussed and acted upon as recorded herein.
First order of business was approval of the Minutes of the February 16, 1999 Decision Meeting. Since the minutes had circulated to the commissioners for their review and corrections, Commissioner Hansen made a motion to approve the minutes; vote was taken; motion carried.
Items 2 through 9 on the CONSENT AGENDA were then considered.
Commissioner Hansen asked if there were questions or comments regarding any of the items on the Consent Agenda. There were none. Commissioner Marsha Smith made a motion to approve all matters on the consent agenda; vote taken; motion carried.
MATTERS IN PROGRESS were then considered.
10. Brad Purdy’s January 28, 1999 Decision Memorandum re: Case No. IPC-E-98-13; Application of Idaho Power Company for Authority to Include Qualifying Facility Power Purchase Contracts in the Company’s 1999 PCA Filing.
Brad Purdy reviewed the decision memorandum. Said currently the PCA assumes a base for QF costs. It doesn’t project for any variations in QF costs. Costs have been increasing and Idaho Power has had some very large true-ups. Staff proposes two changes to the company’s method.  Brad reviewed those. Company has no objection to the Staff’s reduction of the QF constant within the PCA cost projection ($47,574,349 rather than the Company’s proposed $51,882,240). But the Company does object to Staff’s proposed adjustment relating to capturing 100% of QF- related benefits. Staff proposes that deciding this issue could be done by soliciting briefs from the parties. Staff does not believe this involves a technical issue but rather is a matter of the Commission determining what its intent was.  
Commissioner Hansen commented that he tended to agree with Idaho Power Company in that they probably do have a legitimate concern about the debate over 90 or 100%. In his mind he didn’t know what the Commission’s intent was years ago. He wasn’t here then. Think after the comments Brad made it would be wise to approve what is not in dispute now and then allow the
parties - staff and company - to issue a brief on that. It would give him more time to evaluate why the original order was the way it was and whether we need changes today or not.
Commissioner Kjellander said he was inclined to agree with Commissioner Hansen. Briefs would help to clarify; so we should go with that.
Commissioner Smith said she also agreed. It is clear that 100% was to be collected but she was fuzzy on the benefit side; how they are already built in and at only the 90%. Seemed to her we are going to recover all those costs and that was what the Commission intended but doesn’t understand the other.  
Commissioner Hansen then made a motion that the Commission approve that part which is undisputed by the company now and that briefs be requested on the other issue.
Brad interjected that he hadn’t spoken to anyone at Idaho Power about briefs but it would seem they could be submitted fairly soon and a decision could be reached by the Commission prior to the implementation of this year’s PCA.
Commissioner Smith thought it should be done within the next two weeks; the company needs to know.
Commissioner Hansen then withdrew his motion and it was agreed that the matter will be held for two weeks and the matter will be brought back for decision after briefs are filed.
11. Wayne Hart’s February 24, 1999 Decision Memorandum re: Rural Telephone Company Tariff Advice Letter Dated February 9, 1999; introducing Vacation Service.
Wayne reviewed the decision memorandum. Said there are a number of issues that staff thinks deserve investigation so they recommend suspension. Said there is also an EAS petition pending in this area. Recommend 6 months suspension.
Commissioner Hansen called for questions.
Commissioner Smith asked if this could be taken care of with the EAS matter.
Wayne responded it may be possible. Staff hasn’t talked to the company about it yet. A measured service option may provide the same option.
Commissioner Smith made a motion to approve staff recommendation, to suspend the filing for 6 months; vote taken; motion carried.
12. Doug Cooley’s February 25, 1999 Decision Memorandum re: Telecommunication Relay Services 1998 Annual Report.
Doug reviewed the decision memorandum. Staff has reviewed the budget for the coming year submitted by the fund administrator and is proposing three options for rate designs in 1999. Staff is recommending adoption of Option B - attempt to maintain TRS Fund Reserve. That plan recommends an increase to MTS/WATS providers, it recommends a $01 per line rate reduction to local service providers. It will in theory meet the revenue need for 1999 while maintaining the two-month TRS fund reserve balance of $99,000. In addition it attempts to balance allocation of the costs.
Commissioner Hansen had a question; he asked Doug if the rates weren’t increased a year or so ago. Asked when the last time the Commission needed to change line and minute rates and what was the last change we used? Thought we went from 3 to 4 cents.  Asked previously what rates did we have in place for that?
Bob Dunbar, Fund Administrator responded. From ‘95 to ‘98 it was 3 cents and .00045 per intrastate minute. In January 1998 it went to 4 cents per line and .0007 per billed minute. Are trying to take the best guess of what it is going to cost and  trying to balance 50/50 toll and local service. Have had problem with the second item, because with  the EAS activity,  are seeing a significant drop in toll; are guessing on toll. Did leave it alone for quite a while but EAS is forcing a look at it now.
Commissioner Kjellander said that last week he had the pleasure of defending TRS funding. The figures he was given indicated it was  just holding its own. With these proposals, wondered what had changed between then and today? Option B is saying $20,000 less is what it can operate on? Last week the figure was different.
Doug responded the question is in the balance, how comfortable we feel with the balance in the TRS fund. Many companies pay on a quarterly basis and there is a matter of covering different billings in a different time.   With the amount collected,  try to avoid frequent changes so while we say maintaining, you can draw that reserve down to whatever the comfort level of the Commissioners is. It is not intended to make it a money-making matter. Are trying to balance this.
Bob Dunbar added -  are trying to stay where we are. One thing he asks is to use fairly round figures, maybe that rounding might be the difference between last year and this year. Is just trying to get the balance back, not change the amount.
Commissioner Smith said she was concerned with changing rates. Her suggestion would be to keep the local at 4 cents and then look at adjusting the toll piece up to .08 and that way you don’t get very far, but then at $39,000 you do make some adjustment. That shows a cushion of
$60,000. Don’t think that is unreasonable.   Her suggestion would be to not touch the local surcharge and bring toll up some and leave it for another year.
Was discussion on the numbers. Commissioner Smith commented expenses could be more next year.
Commissioner Kjellander said he thought it would help him to get a clearer picture if he could have some information on EAS. Would be more comfortable with .0008 on toll.
Doug said between ‘97 and ‘98 the toll minutes saw a 30% reduction that can be contributed to EAS somewhat. This year 20% was projected;  and that was looking at EAS cases on the table now. To try and estimate that number but judging off last year, there won’t be quite as much of an impact so that is why 20% was chosen.   That is the best estimate staff could come up with.
Commissioner Kjellander asked if it would boil down to  - your guess would be as good as mine?
Doug replied in many ways, yes.
Commissioner Smith then made a motion that the Commission keep the 4 cents per line per month local exchange and increase intrastate toll to .0008 cents per minute.
Commissioner Hansen called for discussion; hearing none, vote was taken; motion carried unanimously.
13. Carolee Hall’s February 26, 1999 Decision Memorandum re: U S West Communications (South) Compliance Filing to Request an Increase in Local Rates to Recover EAS Costs Associated With Recently Implemented Regions Throughout Idaho. The Company is Requesting an Effective Date of April 29, 1999.
Carolee reviewed the decision memorandum. Company will be under-recovering $28,258. Staff believes that the methodology is in compliance with what is set forth in the order and staff recommends 33 cents per line increase now to allow U S West to recover costs associated with EAS and a reduction of $28,258 in future EAS costs.
Commissioner Smith asked is April 29 was the date the cut-over occurs?
Carolee said it was.
Commissioner Smith then made a motion to approve the 33 cents per line. Vote taken on the motion; carried unanimously.
Meeting was then adjourned.
Dated at Boise, Idaho, this 8th day of March, 1999.
Myrna J. Walters
Commission Secretary