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On Thursday, December 18, 2008, the California Public Utilities Commission held its regularly-scheduled agenda meeting, the last meeting of 2008. The meeting was quite eventful and well attended, as the Commission heard from more than 100 public speakers, mostly in connection with the hotly-contested Sunrise transmission line matter involving SDG&E. Although there were no telecommunications items on the regular agenda, there were a number of significant telecommunications items on the consent agenda. Five Small LEC rate case draft resolutions were all held until the Commission’s January 29, 2008, meeting. In a precedent-setting move, the Commission designated ConnectTo as an ETC for LifeLine purposes only in the large ILEC territories, but the resolution addressing TracFone’s request to be a wireless ETC throughout the state was withdrawn. These and other telecommunications-related items addressed during the meeting are summarized below.


REGULAR AND CONSENT AGENDA ITEMS

  • Decision Designating ConnectTo as an ETC in California Adopted (Item 2, adopted on consent agenda) – The Commission adopted a decision granting ConnectTo Communications, Inc.’s request to be designated as an Eligible Telecommunications Carrier (“ETC”) in the territories of AT&T and Verizon for LifeLine purposes only. The decision is noteworthy in that it makes ConnectTo the first ETC in California to receive federal subsidies for LifeLine purposes only. The decision had originally rejected the request in light of the Commission’s view that ConnectTo was out of compliance with local usage, public interest, and reporting requirements, but the Communications Division staff reversed its opinion after receiving a compliance filing from ConnectTo addressing the Commission’s concerns. In revising its opinion, however, CD staff added several safeguards to the process for receiving reimbursements from the federal LifeLine fund. Specifically, ConnectTo, which operates as a wireline reseller, is not allowed to apply for reimbursement for lines obtained from an underlying carrier which already receives a LifeLine credit for those same lines. To ensure against such duplicate claims, the Commission will have the authority to audit ConnectTo’s LifeLine claims. Additionally, for each claim it submits to USAC, ConnectTo will have to attach written confirmation from the underlying carrier that it has not received federal LifeLine support as to the lines for which ConnectTo is seeking support. A recent copy of the proposed decision can be found at the following link: http://docs.cpuc.ca.gov/word_pdf/AGENDA_RESOLUTION/95118.doc.

  • Decision Adopted Approving Amendments to AT&T’s Performance Incentives Plan (Item 24, adopted on consent agenda) – The Commission approved a decision adopting consensus document modifications to the Performance Incentive Plan (“PIP”) setting forth Operational Support System (“OSS”) standards as between AT&T and competitive local exchange carriers (“CLECs”) Comcast Phone of California LLC, Covad Communications Company, tw telecom, and US TelePacific Corp. The Commission opened the rulemaking underlying this decision in 1997 for the purposes of: 1) determining reasonable OSS standards for AT&T; 2) developing a mechanism that would allow the Commission to monitor improvements in OSS performance; and 3) assessing the best and fastest method for ensuring compliance if standards were not met or improvement not shown. On August 5, 1999, the Commission approved a Joint Partial Settlement Agreement among interested parties regarding OSS Performance Measurements. An associated plan for calculating payments when performance does not meet established standards, known as AT&T’s PIP, was established later. On November 27, 2007, AT&T served notice on the CLECs that it planned to hold conference calls to discuss proposed changes to the PIP.

    The proposed changes effectuated by this decision purportedly “reduc[e] the complexity of the plan while preserving the features that truly provide incentives for appropriate performance.” The reduced complexity is intended to make the PIP “more easily understood, more effectively implemented, less susceptible to differing interpretations, and less prone to calculation errors.” The final version of the decision may be found at the following link: http://docs.cpuc.ca.gov/word_pdf/FINAL_DECISION/95482.doc.

  • Decision Setting Time Limit for Notification of In-Language Decision Adopted ((Item 10, adopted on consent agenda) – On October 2, 2008, the Commission adopted Decision 08-10-016, addressing the needs of telecommunications customers who have limited English proficiency (see California Public Utilities Commission Meeting Summary – October 2, 2008) for a full summary of the decision). This decision modifies that first decision by requiring carriers to implement Ordering Paragraph Number 10 of the original decision, dealing with notice, no later than 180 days from the decision’s effective date. Ordering Paragraph 10 requires carriers to provide their limited English proficiency customers with a notice, in the non-English languages in which the carrier markets, directing customers to the www.calphoneinfo.com website for information about ways to protect against fraud. The final version of the new decision is available at the following link: http://docs.cpuc.ca.gov/word_pdf/FINAL_DECISION/95534.doc.

  • Decision Granting Shasta a CPCN Approved ((Item 49, adopted on consent agenda) – The Commission granted Shasta County Telecom, Inc. a certificate of public convenience and necessity under Public Utilities Code Section 1001 that would allow it to construct telecommunications facilities and provide local exchange and interexchange service to and within previously-unserved territory in the Northeastern Intermountain area of Shasta County. A recent version of the decision granting approval is available at the following link: http://docs.cpuc.ca.gov/word_pdf/AGENDA_DECISION/94760.doc.

  • Decision Granting Transfer of Control from First Communication, Xtension Services, and Globalcom to Renaissance Acquisition Adopted (Item 43, adopted on consent agenda) – This decision grants the request for approval of the transfer of control of First Communications, LLC, Xtension Services, Inc., and Globalcom, Inc. to Renaissance Acquisition Corp. No transfer of certificates, assets or customers will occur as a consequence of the proposed transaction. First Communications, Xtension, and Globalcom will continue to provide services to their existing customers in California pursuant to their existing authorizations under the same rates, terms, and conditions. A final copy of the decision granting approval is available at the following link: http://docs.cpuc.ca.gov/word_pdf/FINAL_DECISION/95539.doc.

  • Decision Awarding UCAN Compensation For Its Contribution to Prior Decision Approved (Item 54, adopted on consent agenda) – The Commission approved a decision awarding the Utility Consumers’ Action Network (UCAN) $19,879.25 in compensation for its “substantial contributions” to Decision 08-03-015. Decision 08-03-015 adopted a settlement agreement between UCAN and MCI after a computer billing error on the part of MCI resulting in the alleged overcharging of almost 2,000 customers. UCAN had intervened on behalf of the customers. The award in the decision is a reduction of $4,512.75 (18.5%) from the amount requested by UCAN, due to adjustments in hourly rates, excessive hours, and a disallowance for clerical tasks. The final version of the decision is available at the following link: http://docs.cpuc.ca.gov/word_pdf/FINAL_DECISION/95548.doc.

  • Decision Awarding California Consumer Federation, Greenlining Institute, and Latino Issues Forum Compensation For Their Contribution to Prior Decision Approved (Item 56, adopted on consent agenda) – The Commission approved a decision awarding the California Consumer Federation, the Greenlining Institute, and Latino Issues Forum $87,851.46 in compensation for their “substantial contributions” to Decision 07-07-043. That decision concluded the first phase of the “in-language” or “Limited English Proficiency” proceeding. The California Consumer Federation was awarded $44,597.46, the Greenlining Institute was awarded $15,541.50, and Latino Issues Forum was awarded $27,712.50 in compensation. The final version of the decision is available at the following link: http://docs.cpuc.ca.gov/word_pdf/FINAL_DECISION/95528.doc.


SIGNIFICANT HELD AND WITHDRAWN ITEMS

  • Proposed Rate Case Resolutions for Calaveras, Ducor, Pinnacles, Cal-Ore, and Ponderosa (Items 69-73, held by Staff until 1/29/09) – These five proposed resolutions would resolve the rate cases and set the level of California High Cost Fund-A support for Calaveras, Ducor, Pinnacles, Cal-Ore, and Ponderosa for test year 2009. Recent drafts of the proposed resolutions may be found at the following links:

  • Proposed Decision Regarding Unbundled Network Element (UNE) Reexamination Process (Item 68, held by Staff until 1/29/09) – This proposed decision would apply the Verizon UNE reexamination process to AT&T. If adopted, a price cap mechanism would be implemented for annual updates to the UNE rates for Verizon and AT&T, and periodic cost-study proceedings to update UNE rates would be conducted pursuant to Section 252 of the Telecommunications Act of 1996. These proceedings would be based on the Total Element Long Run Incremental Cost (“TELRIC”) methodology. The proposed decision would establish a schedule for future TELRIC costing proceedings for AT&T and Verizon and mandates the use of the HM 5.3 model in those proceedings. The text of the proposed decision is available at the following link: http://docs.cpuc.ca.gov/word_pdf/AGENDA_DECISION/91683.doc.

  • Proposed Resolution Designating TracFone Wireless, Inc. as an ETC in California (Item 3, withdrawn) – This proposed resolution would have granted the request of TracFone Wireless, Inc. to be designated as a wireless, competitive “LifeLine only” Eligible Telecommunications Carrier (“ETC”) throughout California. TracFone seeks to offer a prepaid wireless offering that would include 50 free nationwide minutes for LifeLine-eligible customers. Although TracFone’s request did not include a service area map reflecting the areas in which it proposed to be an ETC, TracFone seeks ETC status in a “virtual network” consisting of the areas in which it had access to resold wireless spectrum, including the footprints of Alltel, AT&T, Golden State Cellular, T-Mobile, US Cellular, and Verizon. This item has now been withdrawn.


NOTES AND COMMISSIONER REPORTS

  • Appointment of New Legal Advisor for Commissioner Chong – Commissioner Chong announced that her office had hired Pam Nataloni as legal, energy, and water advisor. Ms. Nataloni joins Commissioner Chong’s office from the legal division of the CPUC. She started as a staff attorney with DRA and then moved over to the Office of Governmental Affairs, where she worked as lead attorney for environmental compliance and in the state appellate section.

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