5. The Reasonableness of Requested Compensation

TURN requests compensation in the amount of $13,535 as follows:

TOTAL = $13,535

In D.98-04-059, the Commission adopted a requirement that a customer must demonstrate that its participation was "productive," as that term is used in Section 1801.3, where the Legislature gave the Commission guidance on program administration. (See D.98-04-059, mimeo. at 31-33, and Finding of Fact 42.) In that decision we discuss the fact that participation must be productive in the sense that the costs of participation should bear a reasonable relationship to the benefits realized through such participation. Customers are directed to demonstrate productivity by assigning a reasonable dollar value to the benefits of their participation to ratepayers. This exercise assists us in determining the reasonableness of the request and in avoiding unproductive participation.

TURN states that through the modest expenditure of 35 hours, and about $9,000 in attorney and expert time, TURN was able to avoid permanent rate increases of 3.75% and 5.94% for Pacific and GTEC respectively. According to TURN, those permanent increases would have cost ratepayers billions of dollars in increased expenditure for telephone service over the years. We find TURN's participation was productive in that the costs it claims for its participation were small in comparison to the benefits realized.

TURN documented the claimed hours by presenting a daily breakdown of hours relating to the elasticity issue in I. 87-11-033 for Thomas Long and Regina Costa. The hourly breakdown presented by TURN reasonably supports its claim for total hours.

TURN observes that the efforts of TURN's attorney for which they seek compensation in this request took place primarily in 1995 and 1996. In D.96-06-029 the Commission approved a $225 hourly rate for Long's work in 1995. In D.97-10-049, we compensated Long's work at $240 per hour for work in 1996. Therefore a 1996 rate of $240 per hour for Long is reasonable in this proceeding as well.

In D.96-06-029, we approved an hourly rate of $130 for the work of Regina Costa, TURN's Telecommunications Research Director, in 1995. TURN indicates that the same rate should apply to the minimal time she devoted to this matter in 1995.

We find TURN's requested hourly rates to be reasonable and consistent with our past treatment of attorney and expert fees for comparable work.

TURN requests that it be granted a 50% enhancement for the exceptional results it achieved with a minimum of resources. The Commission has enhanced the base fee award to an intervenor in consideration of factors such as: the size of the award in relation to the results obtained, the efficiency of the intervenor's presentation, the skill required to participate, and the importance and difficulty of the issues. (D.91-08-014.)

According to TURN, each of these considerations justifies an enhancement in this case. Pacific and GTEC sought large permanent rate increases that would have raised the phone bills of virtually every California resident. The elasticity issue and the related issue of the nature of IRD revenue neutrality involved highly complex factual issues. In addition, the draft decisions - particularly the Conlon and Neeper Alternate - raised difficult legal issues about the proper standard for reviewing a request to reopen a proceeding when there is an allegation of gross forecasting error. TURN alleges that because of its intimate understanding of the IRD proceeding, its sound legal analysis, and its ability to place the petition in the proper context of many other developments in telecommunications, TURN was able to make a persuasive and well-supported presentation on behalf of ratepayers. Moreover, TURN says, it was extraordinarily efficient, spending less than 35 hours to present its case. For these reasons, TURN requests an enhancement of $4,487, or 50% of TURN's requested hourly fees, in recognition of TURN's exceptional efficiency and success.

We reviewed the various decisions cited by TURN where we granted an enhancement of the base fee. In D.88-02-056, where TURN's efforts resulted in a $43 million dollar savings for ratepayers, we awarded TURN a 25% enhancement in recognition of the dollar amount involved and TURN's level of success. In D.90-01-050, we awarded TURN a 25% enhancement for the time spent on the discount adjustment issue, where TURN's work achieved short-term savings to ratepayers of $27 million and the subject of the discount adjustment model was highly technical and complex. In D.91-06-015 the complainant was awarded a 25% enhancement notwithstanding the fact that his complaint was dismissed, because of his contributions to addressing a novel and difficult issue and the contingent value of the proceeding. In D.91-08-014 we awarded Consumer Action a 20% enhancement based on (1) the novelty and difficulty of the issues; (2) the large total dollar amount at stake concerning 900 telephone service, and therefore the large potential cost to consumers if necessary safeguards were not adopted; (3) awards in similar cases; (4) the intervenor's degree of success; (5) the efficiency of the presentation; and (6) the importance of the issue.

In D.94-09-022, which involved an action brought by TURN against Pacific for improper processing of payments between 1986 and 1991, we granted TURN a 35% enhancement. In that case, we declined to grant the 100% enhancement requested by TURN, but approved what we termed a "generous" 35% enhancement in recognition of the large dollars involved, TURN's degree of success, the risks involved because of the complexity of the modeling and quantitative estimates, the contingent nature of any recovery of TURN's expenses, and the exceptional work done by TURN's lead attorney.

We also reviewed D.96-09-024, in which TURN was awarded an enhancement for its work in Southern California Edison's 1995 General Rate Case. TURN requested a 50% enhancement for its work in 1995 in that case based on the following: (1) the degree of success achieved; (2) the difficulties involved in successfully opposing a settlement between the utility and the ORA; (3) its efficient participation when compared to utility staffing on issues addressed both by TURN and Edison; (4) the novelty of the issues, namely, linking a settlement on the revenue requirement phase of the proceeding with a settlement regarding a new ratemaking treatment for Edison's nuclear power plants; (5) the importance of the issues raised; and (6) the contingent nature of the fee recovery. Based on our analysis of those six factors, we awarded TURN a 25% enhancement for its work on Phase 1 issues in 1995, but did not agree that an enhancement was otherwise appropriate.

In the case before us today, there is no question that TURN made a significant contribution to D.97-02-049, which adopted TURN's recommendation to deny the Petition. However, we need to determine whether TURN's performance in its work on this decision warrants an enhancement. There is no evidence that TURN was uniquely persuasive in its arguments. On the contrary, a review of D. 97-02-049 shows that ORA presents the same arguments in its written comments that TURN states were covered in its ex parte contacts. TURN has described the major themes of its ex parte presentations, and the issues covered are strikingly similar to those covered by ORA. There is no evidence in the record that TURN's arguments were more persuasive than those of other parties, such as ORA. Multiple parties presented the Commission with similar arguments, and no one party was uniquely persuasive. TURN's request for an enhancement in its award is therefore denied.

TURN requests $75 for photocopying expenses. TURN did not itemize the number of pages it was required to reproduce. While the amount appears reasonable in this case, we caution TURN of the need to itemize its photocopy costs to facilitate review of future requests for compensation.

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