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SEND TO: WILLIAMS, KALE
         CALIFORNIA PUBLIC UTILITIES COMM.
         LEGAL DIVISION
         505 VAN NESS AVENUE, ROOM 2204
         SAN FRANCISCO CALIFORNIA 94102-3298

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          DATE: MAY 21, 1998

        CLIENT: CPUC
       LIBRARY: STATES
          FILE: CAPUC

YOUR SEARCH REQUEST IS:
 DECISION NO. 96-12-020

NUMBER OF DECISIONS FOUND WITH YOUR REQUEST THROUGH:
      LEVEL   1...       1 

Order Instituting Rulemaking on the Commission's Own Motion
Into Competition for Local Exchange Service; Order
Instituting Investigation on the Commission's Own Motion
into Competition for Local Exchange Service

Decision No. 96-12-020, Rulemaking No. 95-04-043 (Filed
April 26, 1995), Investigation No. 95-04-044 (Filed April
26, 1995)

 California Public Utilities Commission

1996 Cal. PUC LEXIS 1081

December 9, 1996

PANEL: [*1]    

   P. Gregory Conlon, President; Daniel Wm. Fessler, Jessie J. Knight, Jr., Henry M. Duque, Josiah L. Neeper, Commissioners  

   OPINION 
  
 Introduction  

   We initially established rules for facilities-based competitive local carriers (CLCs) to be granted a certificate of public convenience and necessity (CPCN) in Decision (D.) 95-07-054. Under those procedures, we processed a group of CLC candidates who filed petitions for CPCN approval by September 1, 1995, and granted authority effective January 1, 1996, for qualifying CLCs to provide facilities-based competitive local exchange service. Since September 1, 1995, we have reviewed and approved CPCNs for a number of CLCs to offer facilities-based and/or resale of local exchange service within the service territories of Pacific and GTEC. By today's decision, we adopt modifications in our administrative processing of facilities-based CLC filings to institute a quarterly schedule for the processing of filings for facilities-based CLC CPCNs.
  
 Background  

   Our adopted CPCN certification rules require that all CLCs must comply with the provisions of the California Environmental Quality Act (CEQA) pursuant to Commission Rule  [*2]   17.1. We stated in D.95-07-054 that the Commission would perform CEQA review for each CLC filing at the level it determines to be appropriate.  

   As part of the approval process of the initial group of facilities-based CLCs, we prepared and approved a mitigated negative declaration as called for under CEQA. We found that with the incorporation of appropriate mitigating measures as identified in the negative declaration, the proposed CLC projects would not have a significant adverse environmental impact. We adopted this mitigated negative declaration in conjunction with our approval of the CLC CPCNs in D.95-12-057.  

   For those CLCs who filed for CLC CPCNs by September 1, 1995, we made the commitment to grant approval to qualifying CLCs by January 1, 1996. We advised prospective CLCs that any filings for CLC operating authority made after September 1, 1995, would be treated as standard applications and processed in the normal course of the Commission's business. Thus, we provided no predetermined schedule for the length of time which would be required for processing those applications.  

   Subsequent to the initial mitigated negative declaration approved in D.95-12-057, we prepared and approved  [*3]   a second mitigated negative declaration covering eight additional facilities-based CLCs who did not meet the deadline for approval with the previous group of CLCs. This second mitigated negative declaration was approved on September 20, 1996.  

   Seven subsequent facilities-based CLC applicants not included in the second negative declaration have been included under a third draft negative declaration. Based upon the comments received during the public comment period, the Commission will make an assessment of proposed mitigation measures to assure that there are no significant adverse environmental impacts from the projects covered under the respective CLC applications. Once all the comments on the negative declaration have been reviewed and adequately addressed, the Commission will finalize the negative declaration and then be in position to take action on those pending CLC applications. 
  
 Discussion  

   On a prospective basis, we conclude that the processing of facilities-based CLC CPCN filings could be improved by instituting a more standardized schedule for conducting the review of the filing, including the required CEQA reviews. Based on the experience we have gained in preparing  [*4]   past CEQA negative declarations, we observe that the negative declaration process has driven the schedule for facilities-based CLC approval because of the time intensive nature of the CEQA process.  

   A standardized schedule will also enable facilities-based CLCs to better know, in advance, the expected timing for review of their filing and to plan accordingly. Thus, in the interest of making the review and approval process more orderly and efficient, we conclude that a standardized quarterly processing cycle should be established for CPCN filings of facilities-based CLCs. We issue this decision to place parties on notice regarding the institution of this schedule to facilitate their planning for entry into the local exchange market.  

   Effective January 1, 1997, we shall therefore institute a quarterly processing cycle for granting CPCN authority for facilities-based CLCs in order to streamline the approval process. The first quarterly period shall begin effective January 1, 1997 and shall end March 31, 1997. Subsequent quarterly cycles will end on June 30, September 30, and December 31, 1997. The group of facilities-based CLCs to be included in the first quarterly cycle are those which  [*5]   file their CPCN applications on or before December 31, 1996 and who were not previously covered under earlier negative declarations. For CLCs which have filed separate applications prior to January 1, 1997, we shall issue separate decisions for each application before the end of the first quarter which concludes March 31, 1997.  

   To further streamline the approval process prospectively, however, we shall reinstitute the procedure used for the CLC CPCNs approved in D.95-12-057 whereby each CLC filing is assigned a separate petition number and docketed collectively under I.95-04-044. Since we will be processing the CEQA review on a consolidated basis for all qualifying CLCs, it will be more efficient and consistent to process other aspects of the CLC filings on a consolidated basis, as well. Accordingly, any CLC filing on or after January 1, 1997 for facilities-based CPCN authority shall make their filing in the form of a petition to be docketed in I.95-04-044. We shall then assign a separate petition number to each filing and process them together. This procedure will replace the separate application filing procedures which we have used up until now.  

   All qualifying facilities-based  [*6]   CLCs who file petitions for CPCN authority between January 1 and March 31, 1996, shall be processed together as a single group, subject to a single consolidated CEQA review n1 and utilizing a single decision. Those CLCs within the group who file a petition during this three-month period and who satisfy all applicable rules for certification, including the terms of any Final Negative Declaration, will be considered for approval by the Commission in the following quarterly period. Thus, CLCs who file between January 1, and March 31, 1997 would be eligible for Commission approval during the April 1 - June 30, 1997 quarter. If a CLC has not satisfied all eligibility requirements, or if its filing raises unusual issues requiring additional time to resolve, we reserve the option of deferring a decision on that CLC petition to a later quarter. 
  
 n1 For those facilities-based CLCs that meet the threshold of environmental impacts similar to those CLCs already approved in prior decisions, the CEQA review will entail the quarterly preparation of a consolidated mitigated negative declaration. If we find upon review that a negative declaration is unsuitable because of the nature of construction or installation of facilities being proposed by a given CLC, we shall instituted an Environmental Impact Report (EIR). In the event a CLC requires an EIR, the approval process may extend beyond a single quarterly period.  [*7]    

   The quarterly processing cycle shall only apply to facilities-based CLCs seeking CPCN authority. If a CLC is only seeking to provide local exchange resale service, a standard application shall be filed by the CLC and processed by the Commission as under current procedures. Because CLC resale authority requires only a Proponent's Environmental Assessment, but does not require the preparation of a negative declaration or EIR by the Commission, there is no need to subject CLCs seeking only reseller authorization to the quarterly schedule. CLCs who wish to incorporate their request for both facilities-based and resale authority into a single filing shall be required to file through the petition process. 
  
 Findings of Fact  

   1. The procedure for facilities-based CLC certification was established in D.95-07-054 which included the requirement that all CLCs must comply with the provisions of the California Environmental Quality Act (CEQA) pursuant to Commission Rule 17.1.  

   2. A negative declaration was prepared pursuant to CEQA covering the initial CLC petitioners who were granted CPCN authority in D.95-12-057.  

   3. The CEQA negative declaration process has driven the schedule for  [*8]   granting facilities-based CLC approval because of the time intensive nature of the CEQA process. 

   4. Going forward, the efficiency of the Commission's CPCN approval process for facilities-based CLCs could be improved by instituting a standardized quarterly schedule for processing CEQA reviews for facilities-based CLCs.  

   5. The efficiency of the approval process could be enhanced by reinstituting the petition filing procedure whereby each facilities-based CLC seeking a CPCN is assigned a petition number, collectively docketed under I.95-04-044, and assigned to a single Commissioner and Administrative Law Judge. 
  
 Conclusions of Law  

   1. A quarterly schedule should be adopted for the processing of facilities-based CLC CPCNs as directed in the order below.  

   2. CLCs only seeking resale authority should continue to file applications and be processed under existing procedures and not be subject to the quarterly approval process.  

   ORDER  

   IT IS ORDERED that:  

   1. Effective January 1, 1997, Competitive local carriers (CLCs) seeking authority to provide facilities-based competitive local exchange service shall be subject to a quarterly processing schedule.  

   2. Those facilities-based  [*9]   CLC applications which are filed on or before December 31, 1996, shall be considered for approval during the quarterly period commencing January 1, 1997.  

   3. Effective January 1, 1997, facilities-based CLCs seeking CPCN authority shall make their filing in the form of a petition to be docketed in I.95-04-044.  

   4. All CLC CPCN petitions filed within a given quarter shall be assigned to a single commissioner and ALJ.  

   5. All qualifying facilities-based CLCs who file petitions for CPCN authority between January 1 and March 31, 1997 shall be grouped together and processed on a consolidated basis.  

   6. Those CLC petitions within each group who meet all applicable eligibility requirements shall be considered for Commission approval once each quarter.  

   7. The CLC CPCN petitions which are filed on or before March 31, 1997, shall be scheduled for Commission consideration in a single decision to be scheduled during the following quarter which begins April 1, 1997. A similar scheduling sequence shall be followed for each quarterly period thereafter.  

   This order is effective immediately.  

   Dated December 9, 1996, at San Francisco, California.  

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SEND TO: WILLIAMS, KALE                 
         CALIFORNIA PUBLIC UTILITIES COMM.       
         LEGAL DIVISION                          
         505 VAN NESS AVENUE, ROOM 2204          
         SAN FRANCISCO, CALIFORNIA 94102-3298