2012 PSC Annual Report - Missouri Public Service Commission

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REGULATORY ACTIVITYhave denied additional telephone numbers to telephonecompanies when specific utilization guidelines are not met.Often referred to as “safety valve” requests, such authoritypermits the Commission to examine and verify telephonenumbering needs involving individualized companyspecificsituations. In the 2012 fiscal year, the Commissionwas asked to examine and make determinations in fivesuch company-specific situations. In all five cases, theCommission granted the telephone company requests anddid so in an expedited manner.The Commission continues to be aggressive in its effortsto conserve telephone numbers. Those efforts have enabledMissouri to delay the implementation of new area codes inthe state.Missouri’s area codes are projected to exhaust allavailable telephone numbers at the following time periods:AREACODEPROJECTED DATE OF TELEPHONENUMBER EXHAUSTION*314 1st quarter of 2022417 3rd quarter of 2028573 4th quarter of 2022636 4th quarter of 2034660 3rd quarter of 2028816 1st quarter of 2026*Forecast as approved by the FCC in April 2012. The exhaust datesare reviewed twice a year by numbering authorities.Programs Administeredby the Missouri CommissionMissouri Universal Service Fund: The Missouri UniversalService Board (Board), consisting of the Commission andOffice of the Public Counsel, oversees the Missouri UniversalService Fund (USF) pursuant to Section 392.248 RSMo.The Missouri USF solely provides funding for discountedtelecommunications services for qualifying low income anddisabled customers. The Missouri USF only provides fundingto landline carriers and does not provide any funding forwireless carriers. There are 51,499 landline subscribers inMissouri receiving support (47,919 low income and 3,580disabled) which represents a 19% decrease over the past year.Federal Universal Service Fund Program: The federalUSF program provides a variety of funding opportunitiesfor providing telecommunications services. Most notablewithin the federal USF program are the high-cost supportprogram and the Lifeline program. Both programs weresignificantly reformed this past year by the FCC.The FCC released reforms for the federal USF high-costsupport program in November 2011. The FCC’s reformscapped federal USF high-cost support funding at $4.5billion. The FCC also created the Connect America Fund toultimately replace all existing high-cost support mechanismsand use such funding for expanding broadband serviceavailability. In addition, the FCC created the Mobility Fundto help expand mobile broadband networks. Althoughcertain federal USF high-cost support will be phased out overa period of years, competitive bidding will be introduced toaward funding.The FCC’s reforms will have different impacts on carriers;however, reform provisions include ways for incumbentlocal telephone companies to maintain funding levels ifcertain conditions are met. For example, the local ratesfor an incumbent rate of return regulated company mustmeet or exceed certain rate levels in order to retain mosthigh-cost support funding. Ultimately, the FCC projects itsreform measures will enable 90% of rate-of-return carriersto see high-cost support reductions of less than 20%. TheFCC’s reforms are also designed to increase accountabilityand oversight.The FCC released reforms for the Lifeline program inFebruary 2012. The FCC’s reforms generally tightenrequirements within all states for participation in thePSC Annual Report 2
REGULATORY ACTIVITYprogram. Although state commissions continue to havesome discretion in the administration of the Lifelineprogram, all states must now require Lifeline applicants tosubmit proof of eligibility.In Missouri, the Commission has long required programparticipants to show proof of eligibility when applying tothe program. The FCC also now requires a company toannually recertify the continued eligibility of all Lifelinesubscribers. The FCC’s reforms required the MissouriCommission to allow applicants to qualify for the Lifelineprogram based on the eligibility criteria of 135% of thefederal poverty level.The FCC also established a duplicate database designedto identify Lifeline customers receiving more than oneLifeline benefit per household. As of July 2012, there wereapproximately 250,000 Missouri subscribers to the Lifelineprogram, approximately 200,000 of those are wirelessLifeline subscribers.State commissions such as the Missouri Commission areexpected to continue to help the FCC in administering theseprograms. The FCC continues to rely on state commissionsto determine if a company should be allowed to drawsupport from the federal USF. For example, in order toqualify for certain federal USF support, a company mustmeet certain state and federal criteria establishing thecompany as an eligible telecommunications carrier (ETC).ETCs receiving high-cost federal USF support must also beannually certified by a state regulatory commission. Suchannual certification is intended to ensure that companies areappropriately using the funding. In Missouri, 46 companies(40 incumbent local telephone companies, three wirelinecompetitive local exchange companies and three wirelesscompanies) currently go through the annual certificationprocess in order to continue to receive high-cost federalUSF support. During the past year, several companiesreceived ETC status in order to receive federal USF fundingfor Lifeline programs only.Relay Missouri: The Commission oversees the RelayMissouri service pursuant to Section 209.253 RSMo. RelayMissouri is a statewide system using third party interventionto connect deaf, hearing-impaired and speech-impairedindividuals with the telephone system.A Relay Missouri fund is used to provide funding for thisservice. The Relay Missouri fund is also used to fund anequipment distribution program which is administered bythe Missouri Assistive Technology Council. Relay Missouriis currently funded by a $.11 surcharge applied to basiclocal telecommunications line service. The surcharge levelis periodically reviewed by the Commission according torequirements established by Missouri statutes.Administrators. This subcommittee meets periodically todiscuss issues relevant to states with a state USF.The Commission also continues to actively participatein a number of telecommunications issues before theFCC.Wholesale DisputesOn November 5, 2010, Nexus Communications, Inc(Nexus) filed a complaint Case No. TC-2-32 seekingto recover back promotional credits from Southwestern BellTelephone Company d/b/a AT&T Missouri (AT&T). Thecomplaint involved offering retail services at wholesalerates. The Commission staff’s seventh status reportwas filed on September 4, 2012, which indicated AT&Tand Nexus continue to engage in discussions over theirdifferences.On October 19, 2011, a case was opened (Case No. TW-22-2 to serve as a repository for documents andcomments associated with an investigation into call routingand call completion problems in Missouri.On November 7, 2011, the Commission staff conducteda workshop in which industry participants came together todiscuss concerns first raised by small rural local exchangecarriers in Missouri. Staff filed its initial investigative reporton January 6, 2012 and another report on August 10,2012. Staff met with representatives of the small telephonecompanies on August 4, 2012, and continues to work withindustry representatives and to evaluate the results ofnetwork reliability testing.On April 3, 2012, a case (Case No. TC-22-33 wasbrought before the Commission due to allegations thatHalo Wireless, Inc. was violating provisions of Missouri’sEnhanced Record Exchange (ERE) Rule.Most prominently, Halo was accused of deliveringlandline-originated traffic and of refusing to paycompensation for the traffic. Based on the allegations,certain local telephone companies commenced to blockHalo’s traffic whereupon Halo filed a formal complaint tostop the blocking activities.Federal Telecom ActivityCommission members and staff are active in several nationalorganizations that respond to national telecommunicationspolicy. Natelle Dietrich of the Commission staff is a staffmember of the federal/state Universal Service Joint Board.The Universal Service Board makes recommendationsto the FCC on issues related to promoting universaltelecommunications service throughout the United States.Commission staff Policy Analyst Dana Parish has beenappointed to the NARUC subcommittee of State USF22 PSC Annual Report
Page 4: TABLE OF CONTENTSBudget ...........
Page 7 and 8: BIOGRAPHIESCommissioner Jarrett is
Page 9 and 10: KEY PSC PERSONNELCommissionersKevin
Page 11 and 12: ORGANIZATIONAL FUNCTIONSAdministrat
Page 13 and 14: REGULATORY ACTIVITY25,00020,00022,M
Page 16 and 17: REGULATORY ACTIVITYalleged deficien
Page 18: REGULATORY ACTIVITYAdditional Notew
Page 21 and 22: REGULATORY ACTIVITYmust rely on FER
Page 23: REGULATORY ACTIVITYcompanies are co
Page 27 and 28: REGULATORY ACTIVITYMANUFACTURED HOU
Page 29 and 30: REGULATORY ACTIVITYConsumer Service
Page 31 and 32: YEAR IN REVIEW2011July 3 Public Ser
Page 33 and 34: STATISTICSNATURAL GAS UTILITIES STA
Page 35 and 36: STATISTICSCOMBINATION WATER AND SEW
Page 37: CONTACTING THE PSCMissouri Public S

2012 PSC Annual Report - Missouri Public Service Commission

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