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PA Bulletin, Doc. No. 99-1157

NOTICES

Reporting Requirements for Biennial Updates of Network Modernization Plans Filed Under 66 Pa.C.S. § 3003(b)(6); Doc. No. M-00930441

[29 Pa.B. 3801]

Commissioners Present:   John M. Quain, Chairperson; Robert K. Bloom, Vice Chairperson; David W. Rolka; Nora Mead Brownell; Aaron Wilson, Jr.

Public Meeting held
April 29, 1999

Opinion and Order

By the Commission:

A.  Procedural History

   On August 5, 1993, the Commission entered an order at Docket No. M-00930441, which initiated efforts to implement Chapter 30.1 In addition to issuing an advance notice of proposed rulemaking to commence the process of promulgating regulations, the order scheduled a public forum to solicit comments from interested parties regarding procedural and substantive issues relating to Chapter 30 litigation.

   The public forum was held on August 16, 1993, and the Commission received both oral and written comments from various interested parties that offered numerous recommendations and suggestions regarding implementation of Chapter 30. Based on the comments received, the Commission entered an order on August 27, 1993, in the same docket, establishing procedural requirements only for petitions for an alternative form of regulation, including network modernization plans, filed under 66 Pa.C.S. § 3003. In that order, the Commission provided guidance with respect to what information should be included in a company's network modernization plan by stating:

    In order to meet its evidentiary burden, each filing LEC shall be required to submit detailed information, including maps and quantitative data, which in great detail identify its plan in all parts of its service territory. The plan shall inventory the LEC's present infrastructure including detailed information regarding the capability of all existing central office switching and transport facilities. The plan shall then detail all projected development, using at most two year intervals, relating the development to both existing and new plant throughout its service territory. The plan shall also discuss in detail any potential opportunities for joint ventures and discuss and qualitatively analyze why its plan results in adequate universal bandwidth.

Re Implementation of Chapter 30 of the Public Utility Code, Docket No. M-00930441, at 13-14 (Order entered August 27, 1993).

   Since this original order was entered in 1993, the telecommunications industry has experienced substantial technological, market and legislative changes. These changes have had a major impact on how telecommunications carriers intend to and will carry out their responsibilities to modernize their networks under Chapter 30. On the legislative front, for example, the Federal Telecommunications Act of 1996 (TA-96) has impacted how incumbent local exchange carriers (ILECs) will meet their interconnection responsibilities and how they will offer unbundled network elements to new entrants. Moreover, mega-mergers in the telecommunications industry, the concept of one-stop shopping, and the introduction of advanced telecommunications services, such as xDSL,2 are forever changing the telecommunications landscape.

B.  Comments to August 27, 1998 Order

   In recognition of this evolving market, the Commission on August 27, 1998, adopted a motion which reopened Docket No. M-00930441 to receive comments from interested parties to assist in developing reporting guidelines for use by all companies required to file biennial updates of their network modernization plans under section 3003(b)(6) of the Public Utility Code. 66 Pa.C.S. § 3003(b)(6). This motion, which was subsequently entered as an Order on September 22, 1998, acknowledged the need to examine closely how to define ''broadband'' availability and to determine how a company's network modernization plan accelerates deployment of a universally-available, state-of-the-art, interactive, public-switched broadband telecommunications network. Reporting Requirements for Biennial Updates of Network Modernization Plans Filed Pursuant to 66 Pa.C.S. § 3003(b)(6) and Re: Implementation of Chapter 30 of the Public Utility Code, Docket No. M-00930441, Opinion and Order, entered September 22, 1998 (September 22, 1998 Order).

   Further, the September 22, 1998 Order asked commentators to consider what the Commission has requested from Bell Atlantic-Pennsylvania, Inc. (BA-PA) in previous updates to its network modernization plan. In this regard, the Commission requested the following information from BA-PA: (1) detail on the location for upgrades in switches, the location for the placement of fiber access lines and other upgrades or expansions; (2) a statement of actual and projected investment to build the modified network; (3) a description of network architecture; (4) a projected deployment schedule; (5) a statement of progress toward universal broadband capability as measured in percentages referenced to access lines in urban, suburban and rural categories, as well as percentages referenced to total access lines; and (6) detail on broadband deployment, including use of consistent school listings. September 22, 1998 Order at 3.

   Based again on evolving technology and market forces, we stated in the September 22, 1998 Order that we must develop parameters for reporting so that we are able to fairly and consistently evaluate what is provided by each company. In this regard, for example, we asked for comments on what type of detail should be provided if the Commission decided to seek reporting information which provides specificity with respect to services which are available and being subscribed to, broken down by customer class, that is, residential, business and institutional.

   On or about October 20, 1998, the Commission received initial comments from BA-PA, the Office of Consumer Advocate (OCA), the Pennsylvania Telephone Association (PTA), AT&T Communications of Pennsylvania, Inc. (AT&T), and MCImetro Access Transmission Services, Inc. (MCI). In its comments, BA-PA identified the following 10 uniform reporting guidelines for the biennial updates of network modernization plans:

   (1)  The biennial updates should report the status of achieving commitments to universal broadband availability, which should be defined ''in terms of the infrastructure being in place so that the end users may purchase existing or future broadband services if they choose to do so--not in terms of the number of customers actually purchasing a specific broadband service.'' BA-PA Comments of October 20, 1998, at 3-4. BA-PA cautioned against the Commission micro-managing the network to the extent of analyzing whether customers are purchasing broadband services.

   (2)  The biennial updates should report present and projected upgrades to switches, fiber deployment, intelligent signaling and ISDN availability. Id. at 7.

   (3)  The biennial updates should explain the carrier's planned architecture for its broadband network. The Commission's reporting requirements must ensure that the carrier is meeting its broadband commitments while at the same time allowing the carrier the flexibility to change its architecture with changing technology and market environments. Id. at 7-8.

   (4)  The biennial updates should project the carrier's deployment schedule. Id. at 8-9.

   (5)  The biennial updates should identify broadband availability in or adjacent to public rights-of-way abutting health care facilities, public schools and industrial parks. Id. at 9.

   (6)  The biennial updates should describe how the carrier is meeting the commitment made in its plan to achieve reasonably balanced broadband availability to urban, suburban and rural areas within its service territory. Id. at 9-10.

   (7)  Expenditures on or revenues from the network should not be required because they are not permissible statutory criteria to approve or reject the updates. How much money a carrier is spending on its network modernization plan is irrelevant to whether the update is ''consistent with and in furtherance of the [company's] currently effective implementation plan.'' The statute also does not require carriers to report expenditures and revenues broken down between urban, suburban and rural categories. Id. at 10-12.

   (8)  The biennial updates should report on joint ventures. Id. at 12-13.

   (9)  The biennial updates should report on the status of products and services that enhance the quality of life for those with disabilities. Id. at 13.

   (10)  Proprietary information should be protected so as not to impact competitively sensitive information in the biennial updates by allowing carriers to file under seal when appropriate. Id. at 13-14.

   The OCA disagrees with BA-PA's positions that the Commission should not be analyzing the number of customers who are purchasing broadband service or that a carrier's investment level to update its network is irrelevant. The OCA instead submits that the following uniform reporting requirements should be included with any biennial updates:

   (1)  The updates should provide the Commission with information on how many customers are buying broadband services. The OCA agrees with the August 27, 1998 Motion at page 2 that such information should be provided and ''broken down by class of customer, i.e., business, residential, and institutional.'' In addition, the OCA asserts that this information should be broken down by region or geographic area within each service territory of the filing LEC. OCA Comments of October 20, 1998, at 5-6.

   (2)  Using the same quantity, class and geographic breakdown outlined in subparagraph (1) above, the OCA asserts that LECs should also report the type of broadband services customers are actually subscribing to. In addition to the type of service, the OCA submits that the price and speed of all LEC service offerings should be included within the biennial update report. Id. at 6-8.

   (3)  The level of investment being made to develop the broadband network should be reported in the biennial reports. Specifically, information regarding the historic, current and projected levels of capital investment in the network as well as updated depreciation report information should be provided. Id. at 8-9.

   The PTA suggests the following biennial reporting requirements:

   (1)  Progress on the percentage deployment standards under which a company-specific network modernization plan is to be measured: (a) digital switching, (b) signaling, (c) trunking, and (d) distribution facilities.

   (2)  A statement of whether the company is ''on track'' for the earlier period reported as well as for the future.

   (3)  If it has been revised substantially from the last biennial report, a general description of the architecture of the carrier's network.

   PTA Comments of October 20, 1998, at 6.

   The PTA asserts that any biennial reporting requirements imposed by the Commission should not add additional or modify existing network modernization commitments. The PTA submits that any reporting requirements must recognize that each Chapter 30 company's network modernization commitment differs. The PTA also asserts that the Commission should measure compliance with a specific commitment to that company's goals, as set forth in the company's approved network modernization plan. Id. at 2-4.

   The PTA agrees with BA-PA that the number of customers or type of broadband services purchased should not become the measurement of compliance under Chapter 30 nor does Chapter 30 require a commitment to a specific dollar amount expended for the network. The PTA also argues that the Commission should fully utilize existing information resources, rather than require the development of new information. Finally, the PTA asserts that all the Chapter 30 companies other than BA-PA are rural, and that therefore it is not necessary to have reporting requirements along urban, suburban and rural lines. Id. at 4-5.

   AT&T does not offer uniform reporting requirements for biennial updates of network modernization plans, rather it focuses its remarks exclusively on what BA-PA should provide in its biennial reports. AT&T Comments of October 20, 1998, at 1-16. As to BA-PA, AT&T recommends the following reporting requirements:

   (1)  BA-PA should submit detailed accounts of its investment in network modernization. AT&T Comments of October 20, 1998, at 9-10.

   (2)  BA-PA should identify and detail which broadband services are available to residential and business customers in urban, suburban and rural areas. Id. at 10-11.

   (3)  BA-PA should provide a detailed analysis of which customers are subscribing to broadband services in which customers have broadband availability at 45 Mbps capacity. Id. at 12-14.

   (4)  BA-PA should provide information not only on the availability of existing broadband services, but should also provide the Commission with information on its future plans to introduce new broadband services in its service territory. Id. at 14.

   (5)  BA-PA should provide detailed explanations of how broadband technology at 45 Mbps is available within 5 days of a service request by a customer. Id.

   (6)  BA-PA should be required to explain how it intends to bring GTE North, Inc.'s current network into compliance with BA-PA's network modernization plan if the merger of the parents of the two companies is completed. Id. at 15.

   Finally, MCI generally supports the positions advocated by the OCA and AT&T. MCI offers the following reporting guidelines for consideration:

   (1)  The information described at page 3 of the Commission's September 22, 1998 Order that is required from BA-PA in its biennial updates, should be required for all Chapter 30 network modernization plans. MCI and Comments of October 20, 1998, at 2.

   (2)  The Commission should require the filing of comparative data before and after the network modernization plan to ensure that the plan truly accelerated deployment. Id. at 3-4.

   (3)  ''Availability'' should mean more than just the deployment of facilities; it should measure the number of customers who requested and contracted for a specific service. In addition, the carrier should provide information on how many requests for broadband services were generated from schools, libraries, health care facilities and industrial parks. Id. at 4-5.

   (4)  A Chapter 30 company should be required to provide its depreciation expense and its total capital investment by expense category to insure that the Chapter 30 company is replacing the value of the network that is being depreciated. Id. at 6.

   (5)  The biennial report should include information related to the impact the network modernization plan has had on employment levels in the state. Id.

   On or about October 27, 1998, the Commission received reply comments from BA-PA, OCA, PTA, AT&T and the United Telephone Company of Pennsylvania d/b/a Sprint (Sprint). In its reply comments, BA-PA asserts that AT&T and MCI missed the mark by failing to provide useful suggestions for arriving at generic, uniformly applicable Chapter 30 guidelines. BA-PA also argues that this is not the proper docket to consider issues related to the proposed merger between BA-PA and GTE. BA-PA Reply Comments of October 27, 1998, at 1-3.

   Specifically, BA-PA argues that Chapter 30 does not require detailed reporting of expenditures on the network. Chapter 30, in its view, simply focuses on the end result--meeting the network modernization commitments, regardless of the cost. Reporting on expenditures to build the network is not relevant because Chapter 30 does not require a LEC to commit to increasing its expenditures by any specific amount. Id. at 3-4.

   Similarly, BA-PA asserts that any review of information on depreciation of network assets is not relevant to whether a LEC is meeting its infrastructure modernization commitments. According to BA-PA, depreciation expense is the recovery of past investment; there is no connection between capital spent in the past to improve the network and capital spent today. Indeed, BA-PA asserts, rapid advances in technology and the increasing impact of competition have resulted in falling prices for many products necessary to modernize the network. Id. at 4-6.

   BA-PA also argues that Chapter 30 does not require the Commission to count the number of customers that use the network; the statute only requires the Commission to look at whether the network is being built. Id. at 6-9. Finally, BA-PA disagrees strongly with MCI's suggestion that Chapter 30 companies should report on the impact their network modernization plans have had on employment in Pennsylvania. BA-PA argues that the statute does not contemplate the reporting of such employment levels; and, in any event, there is no way that BA-PA would be able to report accurately on the impact the network has had on employment in Pennsylvania. Id. at 9-10.

   Both the PTA and Sprint support BA-PA's view that the level of expenditures, customer penetration levels, employment, depreciation and other similar criteria are irrelevant to whether a LEC is meeting its network modernization commitments. PTA Reply Comments of October 27, 1998, at 2-3; Sprint Reply Comments of October 27, 1998, at 2-8. The PTA points out that the biennial reporting requirements are only intended to provide the Commission with information regarding the current status of a LEC's compliance with its network modernization commitments; it is not intended to provide ''a further opportunity for extracting additional commitments from a company with respect to its future provisioning of services.'' PTA Reply Comments of October 27, 1998, at 3.

   Sprint agrees with the PTA that a LEC's network modernization plan provides ''the appropriate guidelines to be used for purposes of analyzing biennial updates.'' Sprint Reply Comments of October 27, 1998, at 1. The level of detail suggested by the OCA, AT&T and MCI to be included in biennial updates, Sprint asserts, is inappropriate and unwarranted. Id. at 1-2. Sprint also submits that the Commission must be aware that imposing reporting guidelines for biennial updates, if they are required by all companies, must be done in the context of a formal rulemaking proceeding. Id. at 8.

   In their reply comments, both the OCA and AT&T support the view that providing the Commission with the number and location of customers utilizing broadband services is relevant to the issue of whether Chapter 30's modernization goals are actually being realized. OCA Reply Comments of October 27, 1998, at 2; AT&T Reply Comments of October 27, 1998, at 3-4. The OCA further submits that the level of expenditures invested is relevant and important in determining a Chapter 30 company's level of commitment to its network modernization plan. OCA Reply Comments of October 27, 1998, at 1.

   The OCA also states in its reply comments its support of BA-PA's position on ''reporting requirements relative to the provision of broadband services to public schools, libraries, health care facilities and industrial parks.'' Id. at 2. In this regard, BA-PA has reported the percentage of these institutions where it has deployed fiber-optic availability to the nearest abutting right-of-way, and the OCA submits that this should be the reporting requirement for all Chapter 30 companies. Id. at 2-3. Finally, the OCA agrees that competitively sensitive information should be protected, but that the Commission and public advocates, such as the OCA, should have ''automatic access to this information subject to appropriate proprietary agreements.'' Id. at 3.

C.  Discussion

   The order we issue today establishing generic reporting guidelines for biennial updates of network modernization plans filed under Chapter 30 of the Public Utility Code is a direct result of consideration of the above-described comments. We appreciate and thank all the commenting parties who provided worthwhile suggestions to aid the Commission in the development of these reporting guidelines.

   Before delineating any specific guidelines to address the types of information that should be included in biennial update reports, however, we wish to briefly address the Commission's authority to issue the guidelines. The Commonwealth Court's decision in Pennsylvania Human Relations Comm'n v. Norristown Area Sch. Dist., 342 A.2d 464 (1975), which was affirmed by the Pennsylvania Supreme Court at 374 A.2d 678, establishes the ability of the Commission to issue guidelines. Specifically, the Commonwealth Court in the Norristown decision emphasized the distinction between a regulation and a guideline or other statement of policy.

   In discussing this distinction, the Commonwealth Court observed that a statement of policy is defined in the Commonwealth Documents Law, 45 P. S. § 1102(13), as including actions that interpret or implement any statute that is enforced or administered by such agency. As the Commonwealth Court recognized, such a document need not be promulgated as a regulation. Further, the Pennsylvania Administrative Code defines a ''guideline'' as a document which announces the policy that any agency intends to implement in future rulemakings, adjudications, or which will otherwise guide the agency in the exercise of its administrative discretion. 1 Pa. Code § 1.4.

   In the present case, by these guidelines, we announce policy that we intend to implement which will provide assistance to LECs in understanding what the Commission believes is necessary and relevant in fulfilling the Commission's responsibility to review and approve biennial updates filed under Chapter 30 of the Public Utility Code. As such, this action we take today is in complete compliance with applicable provisions of the Commonwealth Documents Law and the Administrative Code.

   Turning our attention then to what specific guidelines we should adopt, perhaps the two most difficult and controversial issues raised in the comments relate to the meaning of ''universal broadband availability'' in section 3003(b)(1) and to what extent capital investment information, including depreciation expenses, should be provided. Addressing the ''universal broadband availability'' issue first, while the Commission recognizes the position presented by BA-PA, PTA, and Sprint that the term ''availability'' should only mean evaluating the actual deployment of facilities, we believe, consistent with the position supported by the OCA, AT&T, and MCI, that a way to measure the true success of a network modernization plan is by analyzing the number of customers actually buying the broadband services offered by the LEC.

   As we already stated in our September 22, 1998 Order in this docket, ''the true measure of any local exchange carrier's compliance with its Network Modernization Plan is the provision of actual 'broadband' services to customers.'' September 22, 1998 Order at 3. A network modernization plan offering broadband services with few, if any, subscribers may not benefit Pennsylvania or its citizens as we move into the 21st Century.

   It is critical, therefore, that we be provided accurate information in the biennial reports showing how many customers are buying broadband services and what broadband services are being purchased by customers. Without this information regarding the actual use of an advanced telecommunications network by Pennsylvania consumers, we cannot effectively exercise oversight responsibilities given to the Commission by Chapter 30 to ''ensure the efficient delivery of technological advances and new services throughout the Commonwealth in order to improve the quality of life for all Pennsylvanians.'' 66 Pa.C.S. § 3001(5) (emphasis added).3

   The other contentious issue presented by the parties is whether the Commission should require capital investment information, including depreciation expense information. As described above, BA-PA, the PTA, and Sprint each argue that knowing how much a LEC is spending on its network modernization efforts is irrelevant because Chapter 30 does not require a LEC to commit to increasing its expenditures by any specific amount--it just requires that the network be built. They also argue that depreciation expense information is not relevant because there is no connection between money spent historically to upgrade the broadband network versus money spent now or in the future to improve the network. Finally, Sprint submits that requiring the additional information from all LECs filing biennial reports can only be done through a formal rulemaking proceeding and not through reporting guidelines.

   The OCA, AT&T and MCI, on the other hand, each assert that the level of capital investment being made, as well as updated depreciation expenses, should be included in the biennial reports. They contend that the amount of capital investment being made to build the network is a relevant measure of whether the incentives provided by alternative regulation have actually stimulated an increased development and modernization of the network. To fully measure whether the incentives are working as they should, the three entities submit that current levels of investment must be compared with both past and projected levels of capital investment in the network, as well as depreciation expense information.

   We have previously examined this issue in the context of what was required for the biennial updates to BA-PA's network modernization plan. As noted in our September 22, 1998 Order, in that context in the past we have requested from BA-PA that it provide actual and projected investment levels to build its network. While it is true that Chapter 30 does not explicitly require the production of the information, Chapter 30 does not prohibit production of this type of information if the Commission concludes that it would be helpful in its analysis of whether the network is being deployed and upgraded consistent with the intent of the statute.

   We believe capital investment and annual depreciation reports would be helpful in the Chapter 30 context, because, without information to analyze historical data versus projected trends, we cannot adequately determine or even identify all the issues or concerns necessary to ensure that the LEC is meeting its network deployment obligations. In any event, this type of information is already required to be produced by LECs providing telephone service with over 50,000 access lines or which have gross intrastate operating revenues in excess of $20 million per year under 52 Pa. Code §§ 73.1--73.9, which regulations became effective in August 1995. Final Rulemaking Re Public Utility Depreciation Practices and Capital Planning, Docket No. L-00920062, Order entered May 5, 1995 (May 5, 1995 Order). The stated purpose of Chapter 73 of our regulations ''is to establish uniform and industry-wide reporting requirements designed to improve the Commission's ability to monitor on a regular basis the depreciation practices and capital planning'' of telephone and other utilities subject to Commission jurisdiction. 52 Pa. Code § 73.1.

   Sections 73.3 and 73.4 provide for detailed annual depreciation reports (ADRs) to be filed with the Commission. Sections 73.7 and 73.8 provide that telephone utilities meeting the minimum thresholds, except telecommunications interexchange carriers, resellers and radio common carriers, shall file a capital investment plan report every 3 years, with the first report due by August 31, 1998.

   In deciding that our Chapter 30 biennial reporting guidelines should include capital investment and depreciation expense information for LECs having gross intrastate revenues in excess of $20 million per year or access lines in excess of 50,000,4 the LECs may coordinate their reporting obligations, consistent with our May 5, 1995 Order at 8-9. The coordination will allow the reports required by Chapter 73 in the Pa. Code to be used to provide this Commission with a LEC's capital investment and depreciation expense information in the biennial reports required by Chapter 30 of the Public Utility Code.5 In fact, 52 Pa. Code § 73.8(6) expressly recognizes that ''information required by this section'' that has been provided to the Commission in another required report, need not be filed again so long as the utility notifies the Office of Special Assistants as to the location of the information, and, if necessary, converts the information to the electronic format required under Chapter 73.6

   Finally, three other Chapter 30 reporting guideline issues need to be addressed in this order. The first issue involves the continuing reporting obligations of a LEC under other statutory provisions of the Public Utility Code and regulations adopted by this Commission once its network modernization plan has been approved. Some LECs have asserted in other proceedings or filings before this Commission that language in at least some of our Chapter 30 network modernization approval orders eliminates any other reporting obligations outside of Chapter 30. This order and the guidelines we adopt today clarifies that any such language in earlier Chapter 30 orders was only intended to address reports required under Chapter 30 and was not intended to obviate reports otherwise specifically required in other chapters of the Public Utility Code or in the regulations implementing these other chapters.

   The second issue relates to how ''public schools'' as used in section 3003(b)(3) should be defined so that the Commission can receive uniform and consistent information on broadband deployment to public schools. No party filed comments relating to this issue. The Commission believes that the most prudent course is to follow how public schools are defined and interpreted throughout the Public School Code contained in Title 24 of Purdon's Statutes. For reporting purposes under Chapter 30, therefore, public schools shall include the 501 public school districts within the Commonwealth of Pennsylvania, the intermediate units, all charter schools and all area vocational-technical schools.

   The last issue involves AT&T's position that this Commission should evaluate the impact BA-PA's pending merger with GTE Corporation will have on BA-PA's network modernization obligations while the joint application to merge is pending. We agree with BA-PA's position that any issues relating to this potential impact are more properly considered in the merger proceeding than at this docket; Therefore,

It Is Ordered that:

   1.  The following Chapter 30 Biennial Update Reporting Guidelines are adopted by the Commission, effective on the date of entry of this Order.

   2.  A local exchange carrier that has not filed its annual depreciation report for 1998 or capital investment plan report by August 31, 1998, as required by 52 Pa. Code §§ 73.3--73.4 and 73.7--73.8 shall file these reports with the Commission within 60 days of the entry of this order.

   3.  This order will clarify this Commission's position that approval of a LEC's network modernization plan and acceptance and approval of biennial reports required under Chapter 30 of the Public Utility Code will not alleviate that LEC's obligation to provide any and all reports required in any other provision of the Public Utility Code or in the Commission's regulations implementing these other provisions.

   4.  The Secretary shall certify this order and attached Reporting Guidelines, and deposit them with the Legislative Reference Bureau to be published in the Pennsylvania Bulletin.

   5.  The Reporting Guidelines shall be served upon all incumbent and competitive local exchange carriers, the Office of Consumer Advocate, the Office of Small Business Advocate and the Pennsylvania Telephone Association.

JAMES J. MCNULTY,   
Secretary

Chapter 30 Biennial Update Reporting Guidelines for Local Exchange Carriers

   1.  The biennial updates required under 66 Pa.C.S. § 3003(b)(6) should provide specific information on how many customers are buying broadband services. This information should be provided both by class of customer, that is, business, residential and institutional, and by region or geographic area within each service territory of the filing local exchange carrier (LEC).

   2.  Using the same quantity, class and geographic breakdown outlines in Paragraph No. 1 above, the biennial updates should report the type of broadband service being offered by the LEC.

   3.  The biennial updates should report present and projected upgrades to switches, fiber development, intelligent signaling and ISDN availability.

   4.  The biennial updates should explain the LEC's planned architecture for its broadband network. If the LEC's architecture has been revised substantially from the last biennial update because of changing technology or market environment, the LEC should provide a specific description of the new architecture and the reasons for the change.

   5.  The biennial updates should project the LEC's deployment schedule.

   6.  The biennial updates should identify broadband availability in or adjacent to public rights-of-way abutting health care facilities, public schools and industrial parks. For reporting purposes, ''public schools'' shall include all public school districts within the Commonwealth of Pennsylvania, all intermediate units, all charter schools and all area vocational-technical schools.

   7.  The biennial updates should describe how the LEC is meeting the commitment made in its Chapter 30 network modernization plan to achieve reasonably balanced broadband availability to urban, suburban and rural areas within its service territory consistent with each company's approved Chapter 30 plan.

   8.  Consistent with the reporting obligations contained in 52 Pa. Code §§ 73.1--73.9, for LEC's providing telephone service with over 50,000 access lines or which have grossed intrastate operating revenues in excess of $20 million per year, the biennial updates should provide the level of capital investment being made to develop the broadbank network. Specifically, information regarding the historical, current and projected levels of capital investment in the network as well as updated depreciation report information should be provided. A LEC may coordinate its reporting obligations required by Chapter 73 to comply with this paragraph so long as the LEC complies with the notification requirement contained in 52 Pa. Code § 73.8(6).

   9.  For LEC's providing telephone service with less than 50,000 access lines or which have gross intrastate operating revenues less than $20 million per year, the biennial updates should contain information similar to what is required under 52 Pa. Code §§ 73.4 and 73.8. These small LECs may meet with Commission Staff to determine the precise information to be provided so as to balance the Commission's specific informational needs with the LEC's need to minimize any administrative burdens created by the production of this information.

   10.  The biennial updates should report on joint ventures.

   11.  The biennial updates should report on the status of products and services that enhance the quality of life for those with disabilities.

   12.  As provided in the order approving these guidelines, the acceptance and approval of a network modernization plan and subsequent biennial reports required by Chapter 30, will not eliminate the obligation of a LEC to provide any other reports required in any other chapter of the Public Utility Code or in the Commission's existing regulations.

   13.  Proprietary information will be protected so as not to impact adversely competitively sensitive information in the biennial updates by allowing a LEC to file under seal when appropriate; provided, however, that the Office of Consumer Advocate, the Office of Small Business Advocate and the Office of Trial Staff will have access to this competitively sensitive information subject only to the public advocates entering into appropriate proprietary agreements with the producing LEC.

JAMES J. MCNULTY,   
Secretary

[Pa.B. Doc. No. 99-1157. Filed for public inspection July 16, 1999, 9:00 a.m.]

_______

1  On July 8, 1993, Acting Governor Mark signed Chapter 30 of the Public Utility Code into law, effective immediately. Chapter 30 authorizes local exchange carriers (LECs) to petition the Commission for approval of an alternative form of regulation which, if approved, would replace traditional rate base/rate of return regulation. 66 Pa.C.S. § 3003. Smaller LECs (less than 50,000 access lines) are also authorized to petition the Commission for approval of a streamlined form of regulation. 66 Pa.C.S. § 3006. Each LEC which files for approval of an alternative or streamlined form of regulation must also include in its petition a network modernization plan for Commission review and approval. 66 Pa.C.S. § 3003(b).

2  xDSL is a term of art referring to several forms of Digital Subscriber Line technology. It is a compression technology that enables the provision of different combinations of high-speed data, voice and fax through copper loops using packet-switched routing.

3  See also Re: Bell Atlantic--Pennsylvania, Inc.'s Petition and Plan for Alternative Form of Regulation Under Chapter 30, Docket No. P-00930715, Opinion and Order, entered June 28, 1994, at 167 (Commission found that ''[t]he biennial filings are not merely informational in nature,'' that ''[t]he Commission's oversight is critical to assure that the deployment has been and will continue to be reasonably balanced among urban, suburban, and rural areas'' and that its review was to be more than ''a simple progress evaluation.''

4  For the smaller LECs, we believe the biennial reports should contain information that is similar to the information required under 52 Pa. Code §§ 73.4 and 73.8. The smaller LECs are encouraged to meet with Commission Staff before they file their biennial reports to develop more precisely what information is actually needed, and, at the same time, to minimize any administrative burdens that the reporting requirements will place on the smaller LECs.

5  Any LEC that has not filed its ADR for 1998 or capital investment plan report by August 31, 1998, as required by Chapter 73 of the Pa. Code, shall file these reports with the Commission within 60 days of the entry of this order.

6  We do recognize, as noted above, that Chapter 73 of our regulations requires capital investment plan reports every 3 years, while the biennial reports required by Chapter 30 of the Public Utility Code are, by definition, required every 2 years. To effectuate the type of coordination contemplated in this Order, and at the same time minimize any additional administrative burdens on LECs that may arise from producing this information in the biennial reports, the LEC may use the most recently filed Chapter 73 capital investment plan report then on file with the Commission to provide us with this same information when its biennial report is due.



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