Idaho Public Utilities Commission

Case No. GNR-T-12-03, Order No. 32572

July 3, 2012

Contact: Gene Fadness (208) 334-0339, 890-2712

PUC adopts settlement regarding telephone outage response time

Regulators today approved a settlement that allows regulated telephone companies more time to respond to outages and removes financial credits to customers if response deadlines are not met. The settlement was approved by the Idaho Public Utilities Commission on a 2-1 vote, with Commissioners Paul Kjellander and Mack Redford voting in favor and Commissioner Marsha Smith dissenting.

CenturyLink (formerly Qwest), later joined by other landline companies, asked the PUC to be exempted entirely from Telephone Customer Relations Rule 502 that required regulated telephone companies to restore outages within 24 hours unless the outage occurs on a weekend. If the company fails to restore service within the rule’s time frames, it must credit customers an amount equal to the rate for one month of basic local exchange service. The settlement declines the waiver, but extends the response time for regulated companies to 48 hours, extends response times if outages occur on a weekend and removes the customer credit if deadlines are not met.

The 1993 rule made sense when basic landline service from one provider was all that was available to customers, CenturyLink claimed. “Today, however, a substantial majority of basic local service customers are not cut off from communication and are not out-of-service in the event their wireline telephone is not working.” Further, CenturyLink claimed, unregulated wireless providers are not subject to the commission’s customer service rules, giving them an economic advantage.

The commission’s adoption of the settlement complies with the Legislature’s directive that the commission achieve a “balanced program of regulation and competition,” the majority said. Further, the majority maintained, other customer service rules still in place require prompt response to outages and “the presence of competitive alternatives is adequate in those areas to likely compel reasonable response to reports of outages.”

In her dissent, Commission Smith acknowledged that most customers have competitive choices. “My concern is for those who do not,” she stated. “The comments in opposition to the rule change from those in areas where broadband is not available and access to cell phone service is non-existent or intermittent convince me that we should not ignore their very important concerns and the vital nature of landline telephone service in their lives.”

CenturyLink,also doing business as Century Tel, was joined by Frontier Communications Northwest, Citizens Telecommunications Company of Idaho, TDS Telecommunications Corp and the Idaho Telecom Alliance. They, along with commission staff, engaged in settlement negotiations that resulted in the compromise to extend the response time to 48 hours and to close of business on Monday for outages reported on Thursday and to close of business Tuesday for outages reported on Friday. The rule also requires that at least 80 percent of out-of-service trouble reports be cleared each month within the specified time frames. The former rule set a 90 percent standard. As in the former rule, there are exemptions if outages are caused by circumstances beyond the company’s control, such as a natural disaster or a when a customer causes the outage or does not make a reasonable effort to arrange a repair visit.

The majority pointed to Telephone Customer Relations Rule 500 and 501 still in place even after the revisions to Rule 502. Rule 500 requires each local exchange company “to employ prudent management and engineering practices to ensure that customers receive the best quality of service practicable.” Additionally, each company “is required to adopt and pursue a maintenance program aimed at achieving efficient operation of its systems to render safe, adequate and uninterrupted service.” Rule 501 requires a prompt response to reports of outages. Specifically, “each telephone company providing local exchange service shall provide for the receipt of customer trouble reports at all hours and make a full and prompt investigation of and response to all reports.” Companies are required to “maintain an accurate record of trouble reports made by its customers,” which are required to be available to the commission upon request at any time within two years of the date of the record.

However, Smith said existing rules won’t protect customers in all situations. “It is my experience that business entities respond to the financial consequences that follow from their decisions. There will be changes in restoration service protocol from this rule change. I doubt they will benefit customers in Idaho who rely solely on landline telephone service.”

According to the Federal Communications Commission, wireless services were available at between 80 and 90 percent of populated areas in 2009. The FCC identified 1,221,000 wireless connections in Idaho during 2009, while the 2009 census recorded only 647,502 housing units, according to CenturyLink.

CenturyLink said its workers are taking time to restore landline service to meet the rule’s requirements instead of installing broadband service, which, the company claims, is more important to many customers than landline connections. Commissioner Smith disagreed, stating customers do not care less about their landline service. “In some situations, landline telephone service is their only life line.”

The commission received about two dozen comments from citizens opposed to the compromise rule, as well as AARP Idaho. AARP said elderly customers “are far less likely to rely on cell phone service than are other residents, and those residing in rural areas often have limited or spotty cell coverage.”

The revisions, CenturyLink argued, “promote a more competitive telecommunications market in which customers’ desires and concerns, not outmoded regulatory constructs, drive competitive companies’ responses.” The revised rules lengthen and clarify response issues “while still maintaining standards for restoration that protect customers.”

CenturyLink particularly objected to the month’s free service credited customers for failure to timely respond to outages, calling it the “most blatant example of how Rule 502 creates a competitive disadvantage for incumbent companies. No other competitor is required to pay such credits, which total a substantial economic cost.”

A full text of the commission’s order, along with other documents related to this case, is available on the commission’s Web site at www.puc.idaho.gov. Click on “File Room” and then on “Telecommunications Cases” and scroll down to Case No. GNR=T-12-03.

Interested parties may petition the commission for reconsideration by no later than July 24. Petitions for reconsideration must set forth specifically why the petitioner contends that the order is unreasonable, unlawful or erroneous. Petitions should include a statement of the nature and quantity of evidence the petitioner will offer if reconsideration is granted.

Petitions can be delivered to the commission at 472 W. Washington St. in Boise, mailed to P.O. Box 83720, Boise, ID, 83720-0074, or faxed to 208-334-3762.