COM/CRC/mto Date of Issuance 11/13/2008
Decision 08-11-033 November 6, 2008
BEFORE THE PUBLIC UTILITIES COMMISSION OF THE STATE OF CALIFORNIA
DECISION ADOPTING PROCESS GOVERNING RETIREMENT BY INCUMBENT LOCAL EXCHANGE CARRIERS
OF COPPER LOOPS AND RELATED FACILITIES USED TO PROVIDE
TELECOMMUNICATIONS SERVICES
1. Summary
The Commission declines to adopt CALTEL's proposed rules requiring California's incumbent local exchange carriers to seek this Commission's permission before permanently retiring copper wire local loops from the telephone network.1 We find that the party requesting such rules, the California Association of Competitive Telecommunications Companies (CALTEL), has not demonstrated a current need for action by this Commission. We also believe that the rules proposed by CALTEL will discourage and delay fiber systems from being built in California, contrary to clear state legislative direction to bring affordable and widespread high quality communications services to all Californians. We therefore decline to adopt the proposed CALTEL rules at this time; however, as discussed below, we do establish a notice and negotiation process at the state level for the incumbent local exchange carriers (ILECs) to comply with when retiring copper loops.
We find that CALTEL has not demonstrated any current harm that necessitates the issuance of its proposed rules.2 The record of this proceeding contains no evidence showing that the installation of facilities to replace the copper network by ILECs has resulted in adverse impacts to consumers or competition. However, we will require the ILECs to file concurrently with our Communications Division any notices of network changes that the carriers file with the Federal Communications Commission (FCC) for fiber to the home (FTTH) or fiber to the curb (FTTC) deployment that results in the retirement of copper plant. Filing such notices with our Communications Division staff will allow this Commission to monitor ILEC copper retirement practices. The FCC has found, and we concur, that such notices will ensure that incumbent and competitive carriers can work together to ensure the competitive LECs maintain access to loop facilities. We strongly encourage the carriers to coordinate in such instances to ensure that service to CLEC customers is not unduly disrupted.
Moreover, to facilitate negotiations to access the loop, we will require the ILEC to serve concurrently with its filing at the CPUC, notice of the copper retirement upon all CLECs that are interconnected with the ILEC, regardless of whether the CLEC is serving customers currently on the specific retiring copper loop.3 Within 20 days of the date that the notice of network change has been filed with the FCC, the CLEC must request, in writing, negotiations with the ILEC either to purchase the entire copper loop from the ILEC or to reach an agreement with the ILEC on price and terms and conditions for continued access to loop facilities. The CLEC shall include in its request for negotiations the following information:
a. Whether the CLEC seeks to purchase the copper loop, or whether the CLEC seeks only to have the ILEC maintain access to a loop;
b. the number of current or planned customers on the copper loop;
c. the services that the CLEC provides over the loop or plans to provide over the loop; and
d. the number of UNEs that the CLEC currently purchases.
We will require the ILEC to enter into good faith negotiations with the CLEC for a period of 60 days either to sell the copper loop at issue at fair market value; or to reach a fair and equitable agreement with the CLEC on price and terms to ensure access to loop facilities. A "fair and equitable" agreement for access to the copper loop should include all fair and reasonable costs incurred by the ILEC for maintaining access to the copper loop facility for the requesting party, vis-à-vis the retirement of the copper loop facility. If a requesting party seeks to purchase the copper facility from the ILEC, the price shall be the fair market value of the copper facility to the ILEC, and all maintenance and operating costs of the copper facility thereafter shall be the responsibility of the purchasing party from the date of purchase.
1 For the purposes of this proceeding, we define copper retirement as the replacement of copper loops or copper subloops with fiber to the home or fiber to the curb loops, as referred to in the Federal Communications Commission's Triennial Review Order and in 47 C.F.R. § 51.333(b)(2). See also Review of the Section 251 Unbundling Obligations of Incumbent Local Exchange Carriers; Implementation of the Local Competition Provisions of the Telecommunications Act of 1996; Development of Wireline Services Offering Advanced Telecommunications Capability, 18 FCC Rcd 16978 (2003) (TRO) at ¶ 281.
2 We note that evidence of harm or absence of harm is not the standard for adopting rules in a quasi-legislative proceeding. However, we have considered harm, in addition to other factors, including our pro-investment policies, in determining whether to adopt CALTEL's proposed rules.
3 Effectively, the ILEC shall serve its notice on CLECs and Commission Communications Division staff at the same time that it files it with the FCC. By copper loop, we refer to the copper "transmission facility between a distribution frame (or its equivalent) in an incumbent LEC central office and the loop demarcation point at an end-user customer premises, including inside wire owned by the incumbent LEC." See TRO, at n. 638.
