20000731.min.doc

MINUTES OF DECISION MEETING
July 31, 2000 - 1:30 p.m.

In attendance were Commissioner Dennis Hansen, Marsha H. Smith and Paul Kjellander.

Commissioner Hansen called the meeting to order.

First order of business was consideration of the items on the CONSENT AGENDA.

Commissioner Hansen announced that Item 6 was being pulled from the Agenda, so those matters being considered were Nos. 1 through 5 and 7 through 10. He asked if there were any questions or comments on any of the items?

Commissioner Smith said she wanted some reassurance that on the Post Falls/Rathdrum boundary change, that this is one that actually makes sense for where people want to call.

Birdelle Brown responded it was one that made sense. It is within the new subdivision boundary.

Commissioner Smith asked if they were moving to the correct exchange? Is it the right way?

Wayne Hart responded - the majority falls in the Post Falls area - 2/3 Post Falls and 1/3 Rathdrum.

Birdelle said Post Falls has the larger developments.

Commissioner Hansen then made a motion to approve the items on the Consent Agenda, per staff recommendations.

MATTERS IN PROGRESS

Don Howell's July 25, 2000 Decision Memorandum re: review of the RFP For Telecommunication Relay Service (TRS) In the State of Idaho.

Doug Cooley spoke to the matter. Only questions submitted were from Sprint. The reason staff is bringing this to the Commission, is to ask whether or not the commission would like to continue with the RFP process.

Commissioner Kjellander said he did have a couple of questions. With Sprint, they raised twenty questions, some of them seemed valid; others less-so. No. 1, it seems what Sprint is getting after is that only one vendor would be able to meet the standards, the question troubles him more than the answer. Wanted to resolve: in the decision memo it mentions that in 1995 there were three bids, asked Doug if he recalled how many met the minimum requirements?

Bob Dunbar responded. It was MCI, AT&T and Hamilton. AT&T didn't meet specifications. The other two met all the bid specifications at that time.

Commissioner Kjellander asked how much more stringent the requirements were this time as opposed to 1994?

Bob said the requirements this time are less stringent - subcontracting is being allowed.

The other area is: we have changed the speed of answer requirement. Are still going for the 5 seconds speed of answering but have loosened up how it is measured.; Haven't tightened any of the requirements as opposed to the other bids.

Commissioner Kjellander asked - is this the first that is exchange to exchange? The bid that is going out, people are offering exchange to exchange and there should be no particular specifics due to that?

Bob Dunbar replied that that was correct. There may be a bit of confusion on one of the FCC requirements. That requirement is the typing speed. When that is implemented they will have to be negotiated. Exchange to exchange and special to special will be there.

Commissioner Kjellander spoke to the financial impact.

Bob said he sees that as an expense that shouldn't be there.

Commissioner Kjellander said the other question was: the 10% for subcontracting? That has loosened up from 1995? Why does that matter?

Bob replied - the Advisory Committee in the past has wanted to deal with the company signing the contract. Didn't want to have the situation of dealing with a relay in North Dakota run by a private company. Five years ago that was proposed. We want to deal with who signs the contract. Said his experience with telecommunications is when you get subcontractors involved that can be trouble down the way.

Commissioner Hansen asked - are you aware of the requirements in other states around us, are they similar requirements or is there a great amount of difference?

Bob Dunbar said - it is similar to recent bids that went out. Each state has basically the same ideas in the RFP. Ours is basically assuring that the quality of service doesn't decline. We have been disappointed because the national organization was to put together a model RFP to use. That has never come out.

Commissioner Smith had one clarifying question. Asked Bob if he was wanting to stick with 5 seconds?

Bob said that was correct. That has been loosened up.

Commissioner Kjellander said Sprint was concerned about 3 seconds. Thought that was going to be used against them. If the Company comes in with something less than 3 seconds, is that a deal breaker?

Bob replied - no.

Commissioner Hansen then called for a motion regarding whether or not to approve the RFP as written?

Commissioner Smith said she had a question. Said she didn't know enough about the process, are we the one who decides this or is it for the Advisory Board?

Don Howell said the two councils review it first and recommend changes. Then it goes to the TRS advisory committee. Yes it comes here for the Commission's approval after Bob has done the draft so people have a dialogue. When bids are made, the administrator will make recommendation and the commission will either approve his recommendation or select someone else. Commission gets to look at the RFP and the selection.

Commissioner Kjellander asked who had veto power in the process?

Don Howell responded that the Commissioners have.

Commissioner Hansen asked what the pleasure of the Commission was?

He then recommended that the Commission approve the RFP as written and allow the process to continue as previously outlined.

Commissioner Kjellander said generally he was going to support that, but he did have one question still. Does this become a state contract?

Don Howell said this is a quasi-state contract. The way that the statutes are written, the Administrator is a separate legal entity that can be sued or can sue on behalf of the TRS process in Idaho. So if you are talking about exposure or liability, it has that but the Commission doesn't carry the entire burden.

Commissioner Kjellander asked - so it wouldn't need to go through someone else?

Don Howell said no. Normally the conditions nearly mirror the Department of Administration.

Commissioner Hansen explained the motion. Vote taken: motion carried unanimously.

Wayne Hart's July 27, 2000 Decision Memorandum re: Formal Complaints by Imbris,Inc. Against Verizon Northwest, Inc. (FKA GTE Northwest).

Wayne Hart reviewed the matter. Complaints were filed just before the deadline for disconnection. He gave the background on C Systems. Major contributor to the issues here is whether or not it is a new corporation or a sham corporation. Wayne set out the points in dispute. In the first complaint Imbris claimed that Verizon was imposing unreasonable restrictions on the transfer of accounts. The second complaint involved deposits for new service.

Commissioner Smith asked for staff recommendation on the first complaint.

Wayne Hart said staff finds that an affidavit is a reasonable compromise. It was only suspended for a 24-hour period. Staff thinks it should reissued. Balance should be arranged for by Verizon. In some cases the balances are due to instances or back-billing or delayed billing by GTE. If C Systems were paying these, they would have the same time. The same time should apply to Imbris instead of making them pay it up front.

Commissioner Kjellander said as he read through the decision memo, with regard to the new company accepting the balances, are you talking about balances on past due, all the provisions of C Systems?

Wayne Hart responded, when a new company takes over, they get the same numbers. It appears to the outside world that there have been no changes and they then accept responsibility for the account.

Commissioner Kjellander said - Imbris chose only to substitute on some of the lines, not all of them.

Wayne said the company found those balances. New service isn't going to be up and running unless they supercede so they feel they were forced to supercede.

Commissioner Kjellander said we are basing this on determination on whether C Systems and Imbris are the same company/ Isn't that what your decision is based on? It is not based on whether or not it is an old company, a new company, to supercede on a line?

Wayne Hart said you wouldn't ask that if you were a different company?

Don Howell said in the first complaint you had C Systems agreeing to transfer to Imbris. You have an agreement - how long do they get to pay the past-due account? GTE said we want all of the money now. Staff is recommending Imbris be allowed to pay off the in the same amount of time as they took to bill. If they took 18 months to bill, Imbris should have 18 months to pay. But going forth they could pay all charges. Do not have to get to this question yet. The issue is what is the length of time Imbris has to pay past due accounts?

Commissioner Kjellander said we don't have a complaint that this Company won't pay.

Don Howell said what happened was: Imbris took a look at the account, said we don't want those large balance accounts, on those they said we want a new account. During this transfer, GTE said it looks like we are going to be left with this. After they placed the new orders, they were required to pay new deposits. Explained what Imbris saw this as. GTE could have disconnected those accounts that were not superceded.

Commissioner Hansen asked if there was any further discussion on Complaint No. 1.

Don Howell said there are representatives from both parties present at this time.

Commissioner Hansen called for a motion on the first complaint.

Commissioner Smith said assuming what she believes to be represented as the case, she would make a motion that the complaint be dismissed with the compromise, and that payment arrangements be made that are reasonable and Imbris get equal time to pay.

Vote taken: motion carried.

Second complaint.

Wayne Hart said the Company is contending that GTE is imposing restrictions on installation of the new accounts including deposits that they do not impose on other internet providers. While they specifically mention deposits, the timing would be part of the complaint.

Commissioner Smith said if it is not something they are complaining about, don't make it up.

Wayne Hart said some of the orders were placed in April; some in early June. On June 22 the Company imposed deposits on those orders that had not been installed. The company filed an informal complaint at that time. Staff looked into the matter, but didn't think it had enough information so they invited a formal complaint. Staff did look at the amounts of the deposits. They were in accordance with Commission rules and regulations, etc. Staff thought those were reasonable.

Primary issues are: When the orders were placed, no deposits were mentioned. Imbris maintains that the Company does not have a standard policy on deposits for new companies. It wasn't until weeks or months later that the company decided to impose a deposit. In conversations with our Consumer Division, they can recall instances where deposits have been required later, but typically they were required after they get credit information on the companies. So there was some precedent on deposits after orders are placed. We don't have the ability to search our records to identify that without reading through thousands of complaints. But that is staff's recollection in this case staff had conversations with GTE. They were aware of Imbris being a new company. Staff believes that there was no new information that lead to the deposits requirements. There are enough questions that staff recommended that this complaint be processed in the normal manner. Asked GTE to respond.

Commissioner Smith asked - do our rules speak at all to when a deposit should be requested?

Wayne Hart responded no.

Commissioner Smith asked if a deposit can be required at anytime?

Wayne said he thought that was the case.

Commissioner Smith asked - a utility under our rules could request a deposit at anytime?

Wayne said yes.

Commissioner Smith asked about the uncollectibles going to the customers?

Wayne said he didn't know the answer to that.

Don Howell said uncollectibles would go to the general body of ratepayers.

Commissioner Hansen asked about the second complaint - what is the pleasure of the Commission?

Commissioner Smith said she would make a motion to dismiss the second complaint if our rules say there can be a deposit at any time, don't see it as discriminatory. Whether it was 2 hours or 2 months after, if it is a question of financial consideration. The allegation of "sham company" needs to go somewhere else. Don't feel that there has been a violation of our rules.

Commissioner Hansen agreed.

Therefore the dismissal is without prejudice.

Vote taken: motion carried unanimously.

Meeting was adjourned.

Dated at Boise, Idaho, this _________day of August, 2000.

Myrna J. Walters, Commission Secretary