311 MAILING OF DRAFT RESOLUTION
The draft resolution of the Telecommunication Division in this matter was mailed to the parties in accordance with PU Code Section 311(g). Comments were filed on (date) by (parties) and reply comments were filed on (date) by (parties). [disposition of comments/revisions to draft resolution]

FINDINGS

1. Advice Letter 672, filed on October 2, 2000 by CTC-California, as adjusted by supplemental work papers propose an increase of $1,051,498 over its 2000 base-year revenues. The implementation of CTC-California's 2001 price cap index filing will become effective on February 1, 2001.

2. CTC-California's AL 672 and its adjustments, supported by workpapers, reflects:

a. A GDP-PI factor of 2.04% to adjust its price floors,

b. Z-factor revenue adjustments to reflect exogenous effects not reflected in the GDP-PI:

i. NECA High Cost Fund, an ongoing revenue increase of $1,404,412

ii. Payphone Deregulation, an ongoing revenue decrease of $186,051

iii. OB&C Rule Change, an ongoing revenue decrease of $166,863

3. CTC-California's request for an ongoing revenue adjustment associated with the deregulation of payphone is reasonable.

4. CTC-California's request for ongoing revenue adjustment associated with OB&C rule changes is accepted.

5. A total price cap mechanism revenue increase of $1,051,498, as adjusted by supplemental work papers effective February 1, 2001, is justified. The adopted revenue adjustments are summarized in Appendix A to this Resolution.

6. CTC-California's surcharge should be calculated on an eleven-month basis due to the February 1, 2001 effective date. The adopted surcredits are identified in Appendix B to this Resolution.

7. CTC-California's requested price floor revisions, as adjusted by its supplemental workpapers, are reasonable.

THEREFORE, IT IS ORDERED that:

1. CTC-California shall increase its annual revenue (relative to its 1996 base year filing) by $1,051,498 effective February 1, 2001, as a result of its 2001 annual price cap index filing in Advice Letter Number 672.

2. The revisions to CTC-California's price floors filed in Advice Letter 672 are adopted and shall be effective February 1, 2001.

3. CTC California shall on a going forward basis submit true-up adjustments in accordance with NECA "true-up" provisions in subsequent price cap filings via a Z-factor adjustment.

4. CTC-California shall supplement its AL No. 672 on or before January 31, 2001, to implement billing surcharges/surcredits reflecting the revenue requirement increase in Ordering Paragraph 1, applied to a total billing base of $ 54,518,674 for intraLATA exchange and private line services, intraLATA toll services, and intraLATA access service, to become effective on February 1, 2001, and spread over eleven months subject to review and approval by the Commission's Telecommunications Division.

This Resolution is effective today.

I hereby certify that the Public Utilities Commission at its regular meeting on January 18, 2001 adopted this Resolution. The following Commissioners approved it:

__________________________________

WESLEY M. FRANKLIN

Executive Director

Appendix A

Resolution T-16479

Citizens Telecommunications Company of California

2001 Price Cap Filing

(In Whole Numbers)

CTC-California

Proposed Adopted

Revenue Revenue

Impacts Impacts

Adjustments:

High Cost Fund $1,404,412 $1,404,412

OB&C ($166,863)* ($166,863)*

Payphone Deregulation ($186,051)* ($186,051)*

Total Adjustments: $1,051,498 $1,051,498

*Surcredits are represented by parenthesis.

Appendix B

Resolution T-16479

Citizens Telecommunications Company of California

2001 Price Cap Filing