20030707_538.pdf

DECISION MEMORANDUM
TO:COMMISSIONER KJELLANDER
COMMISSIONER SMITH
COMMISSIONER HANSEN
COMMISSION SECRETARY
COMMISSION STAFF
DAVE HATTAWAY
RON LAW
FROM:DON HOWELL
DATE:JUL Y , 2003
RE:COLUMBINE'S OBJECTION TO ITS 2003 REGULATORY ASSESSMENT,
CASE NO. COL- T -03-
On May 12, 2003 , Columbine Telephone Company (dba Teton Telecom) filed a
timely objection to its annual regulatory fee for calendar year 2003. In its objection, Columbine
stated that it had over-reported its gross Idaho intrastate operating revenue for calendar year
2002. Instead of reporting just its Idaho revenue, the Company explained that it inadvertently
included revenues from its Wyoming operations and federal Universal Service Funds (USF) in
its report to the Commission. On May 22, 2003, the Commission issued a Notice of Objection in
Order No. 29245. In its Order, the Commission directed the Staff to expeditiously conduct an
audit of Columbine to verify the reported revenues of Columbine. Once the Staff completed its
audit, the audit findings were to be provided to Columbine. Order No. 29245 at 3. If the utility
agreed with the results of the Staff s audit, then the parties were to apprise the Commission. If
the parties did not reach agreement, then the Commission would schedule a hearing.
STAFF AUDIT
On June 11 , 2003 , the Staff forwarded its audit results to the Company. The Staff
agreed with the Company that Wyoming revenues were erroneously included in Columbine
reported Idaho revenues. However, the Staff also determined that two other adjustments to
Columbine s gross operating intrastate revenues were necessary. First, Staff asserted that
Columbine had offset the expenses and revenues in Account 5010 (public telephone revenues).
Staff recommend that revenues in the amount of $3 060 should be reported for this account.
DECISION MEMORANDUM
Second, the Staff determined that Columbine had received USF monies from NECA
for Idaho in the amount of $1 742 218. Staff noted that these funds are traditionally treated by
the Commission as operating revenues to support the calculation of intrastate rates. Because
these funds are recognized as revenue by both the Commission and the FCC, the Staff asserted
that this revenue "should be reported as Idaho ' gross operating intrastate revenues.'" Audit at 1.
With these two adjustments, the Staff determined that Columbine s 2002 gross
operating intrastate revenue should be $3 705 876. Based on the 2003 assessment rate of .2384%
002384), Staff calculated Columbine s regulatory fee for 2003 as $8 834.81. Because
Columbine had already submitted a check in the amount of $4 500, Staff calculated that the
November installment of the 2003 regulatory fee should be $4 334.81.
On July 2, 2003, Columbine agreed with the Staffs calculation that the Company
gross operating revenues for 2002 should be $3 705 876.
STAFF RECOMMENDATION
Given the agreement between the Staff and Columbine regarding the Company
2002 gross intrastate operating revenues, Staff recommends that the Commission adopt this
calculation.Consequently, Staff recommends that Columbine be directed to submit its
remaining 2003 regulatory fee in the amount of$4 334.81 no later than November 15, 2003.
COMMISSION DECISION
Does the Commission adopt the parties' agreement that Columbine s gross intrastate
operating revenues for 2002 are $3,705 876? Does the Commission find Columbine s remaining
assessment due by November 15 to be $4 334.81 ?
Don Howell
VldIM:COLTO32
DECISION MEMORANDUM