1. The Commission's Order initiating this investigation was published in the Pennsylvania Bulletin on June 25, 1994, at 24 Pa.B. 3180.
2. The advanced notice of proposed rulemaking was published in the Pennsylvania Bulletin on April 22, 1995, at 25 Pa.B. 1521 which solicited public comment on the process and procedures to be used by the Commission in its ongoing evaluation and review of the "universal service" definition.
3. The Commission's September 5, 1995 Order initiating a proposed rulemaking at L-0095105 was published on November 11, 1995 in the Pennsylvania Bulletin at 25 Pa.B. 4796.
4. In the Matter of Federal-State Joint Board on Universal Service, CC Docket No. 96-45, Recommended Decision (November 8, 1996) (hereinafter referred to as "Joint Board Recommended Decision").
5. The definition of BUS in Pennsylvania includes unlimited local calling. In our Final-Form Rulemaking Order at Docket No. L-00950105, entered June 21, 1996, we noted that Section 1324 of the Public Utility code, 66 Pa.C.S. § 1324, which requires all local exchange carriers to offer unlimited usage within a local calling area on a flat rate basis -- demonstrated the General Assembly's view that unlimited usage is an essential service.
6. Application of MFS Intelenet of Pennsylvania, Inc.; Application of TCG Pittsburgh; Application of MCI Metro Access Transmission Service, Inc.; Application of Eastern TeleLogic Corporation, Docket Nos. A-310203F.0002, et al., Order entered October 4, 1995 ("MFS Phase I").
7. In the Matter of Implementation of the Local Competition Provisions in the Telecommunications Act of 1996, CC docket No. 96-98, First Report and Order (Released August 8, 1996).
8. Similar arguments have been expressed by other parties in this proceeding. See Bell Reply Brief at 18, n. 53, citing OCA Main Brief at 20-24; OTS Main Brief at 28-29; Pennsylvania Cable and Telecommunications Association ("PCTA") Main Brief at 7-9.
9. Bell argues that for "many years, this Commission has also accepted cost results using the Bellcore models to support [Bell's] pricing decisions." Id. at 18-19. Bell stated that the proprietary nature of the Bellcore models was safeguarded by a ruling of the presiding Administrative Law Judge Corbett. While Judge Corbett "....found that [Bell] did not meet its burden of proof since it relied on the Bellcore models," the Commission did not adopt the ALJ's ruling on this point. See Chapter 30 Competitive Safeguards Investigation, Docket No. M-00940587 (Order entered August 6, 1996). Nevertheless, the Commission did find that Bell's TSLRIC studies were in need of further examination and it ordered subsequent actions to be taken in that respect. Id., at p. 159. More specifically, the Commission's directives related to the performance of Bellcore's cost model runs through the use of OCA-supplied inputs and assumption. OCA's August 13, 1996 Petition for Reconsideration that also addressed this point was denied by Order adopted October 3, 1996 in Docket No. M-00940587.
10. According to Bell, it was unable to obtain certain information primarily relating to the material, engineering and installation costs for telecommunications equipment that had been incorporated in the BCM, Hatfield and Dr. Johnson's respective models, where such cost information was considered to be proprietary. Bell Reply Brief at 20 & nn. 58-60.
11. Accord, OTS Main Brief at p. 5 ("Bell's proposal to, in effect, treat a dial tone line and 3.57 local calls per month (budget service) as Basic Universal Service should be flatly rejected as absurd.")
12. Here, the references to the BCM concern its initial version which is also designated as the "BCM-1". References to the subsequently modified and enhanced version of the BCM will be counted with the term "BCM-2".
13. A CBG is a geographic unit defined by the Bureau of the Census, U.S. Department of Commerce, which ideally contains approximately 400 households. There are 11,688 CBGs within the Commonwealth of Pennsylvania. Sprint/United Stmt. 2.0 (Dunbar) at p. 5.
14. These data have been obtained from the Soil Conservation Service, U.S. Department of Agriculture. Sprint/United St. 2.0 at 7 (Dunbar).
15. PTA cites PTA St. 2 and attached PTA Exh. DMC-1.
16. The OCA also advocates the use of workshops in the post-Order phase of the instant proceeding "...in order for active parties to monitor compliance with the Commission's findings and its final order in this proceeding." OCA Main Brief at 26.
17. The development of the annual carrying charge factor is discussed in more detail at p. 51, supra.
18. SLU factors reflect the relative minutes of use for the various services. An intrastate toll SLU factor would be calculated by dividing intrastate toll minutes of use (originating and terminating) by total minutes of use (interstate toll, intrastate toll and local exchange) for the service area in question. OCA St. 1 (Johnson) p. 21.
19. See, Washington Utilities and Transportation Commission v. Pacific Northwest Bell Telephone Company, Cause No. U-85-23, 80 PUR4th 80, 86, 95 (1986); In the Matter of Amendment of Part 36 of The Commission's Rules and Establishment of a Joint Board, CC Docket No. 80-286 (1995).
20. New England Telephone Generic Rate Structure Investigation, New Hampshire Public Utilities Commission, DR 89010, slip op., March 11, 1991 at 39-40 (emphasis added; 76 NH PUC 150, 166 (1991); Re: Investigation into Nontraffic-Sensitive Cost Recovery, Docket No. 860984-TP, Order No. 18598, Fla. PSC, 89 PUR4th 258, 265-66 (1987); Ex parte South Central Bell Telephone Company, Docket No.. U-15955, Order No. U-15955, 83 PUR4th 1, 5 (1987); Re Mountain State Telephone and Telegraph Company, K&S Docket No. 1720, Decision No. C87-364, 82 PUR4th 64, 84 (1987).
21. SPF relies on SLU data but introduces weighting into the computations which puts greater emphasis on toll usage than on local usage. OCA St. 1 at p. 23.
22. Rulemaking to Establish a Universal Service Funding Mechanism; 52 Pa. Code §§ 63.141, et seq., Docket No. L-00950105, Order entered May 23, 1996.
23. Commission Order at this docket (September 5, 1995).
24. Brockway concedes that her estimates of the potential loss of subscribership do not reflect an assumption about reduced toll bills, however, she argues that there is no basis to assume: (a) that any given toll rate decrease will occur as a result of universal service policies or basic exchange rate increases, (b) that any toll decrease that does occur is occasioned by and causally linked to the basic rate increase contemplated by the hypothetical universal service policy guidelines, (c) that such a toll rate decrease will affect the customers whose basic exchange rates are being increased by rate rebalancing, and (d) that such toll decreases will be sufficient to offset the specific increase in basic exchange rates contemplated by the proposed universal service rate levels in excess of current basic exchange rates. Brockway states that all these conditions must be met before one can rely on toll price reductions to preserve the goals of universal service policy. Brockway Rebuttal at p. 31.
25. Dr. Johnson, Tr. at 410-11, testified that usage revenues should be included in calculating a universal service subsidy. Dr. Bryant, MCI Statement No. 1.0 at 9-10 concurred.
26. Petition Requesting the Commission Institute a Generic Investigation, P-830452. Order entered December 28, 1983, Mimeo at 9-14.
27. While the Commission has recently approved a Chapter 30 streamlined regulation and network modernization plan for the Frontier Companies at Joint Petition of Frontier Companies for Streamlined Regulation, Docket No. P-00951005, Order entered December 6, 1996, and is currently in the process of evaluating and issuing a final decision on the Chapter 30 petition for alternative regulation and network modernization of Commonwealth Telephone Company at Docket NO.l P-00961024, neither of these companies are net contributors into the funding mechanism at this time.
28. Florida determined taht BellSouth's proposal to charge switched access rates creates a price squeeze, erects barriers to entry and most importantly contains contribution towards universal service obligations which is inappropriate in the interconnection rate. Teleport states that BA-PA's similar proposal must be rejected. Teleport Main Brief at p. 32.
29. But see PTA Main Brief at pps 38-39 ("In fact, the Commission promulgated EAS regulations to recognize community of interest calling and those regulations contain provisions for one-way EAS for just that very reason -- traffic is not equalized between exchanges, even when the exchanges are in the same local rate center. ...Therefore, any proposed settlements based on a balanced flow of traffic, as suggested by Mr. Gabel on behalf of TCG, Pittsburgh, would be improperly premised.")
30. Subpart (5) provides as follows:
(5) DEFINITIONS. -- For purposes of this subsection:
(A) ELEMENTARY AND SECONDARY SCHOOLS.--The term 'elementary and secondary schools' means elementary schools and secondary schools, as defined in paragraphs (14) and (25), respectively of section 14101 of the Elementary and Secondary Education Act of 1965 20 U.S.C. 8801).
(B) HEALTH CARE PROVIDER.--The term 'health care provider' means--
(i) post-secondary educational institutions offering health care instruction, teaching hospitals, and medical schools;
(ii) community health centers or health centers providing health care to migrants;
(iii) local health departments or agencies;
(iv) community mental health centers;
(v) not-for-profit hospitals;
(vi) rural health clinics; and
(vii) consortia of health care providers consisting of one or more entities described in clauses (i) through (vi).
(C) PUBLIC INSTITUTIONAL TELECOMMUNICATIONS USER.--
The term 'public institutional telecommunications user' means an elementary or secondary school, a library, or a health care provider as those terms are defined in this paragraph.