Comments on Draft Decision

The draft decision of ALJ Jones in this matter was mailed to the parties in accordance with Pub. Util. Code § 311(g)(1) and Rule 77.7. Comments were filed on April 22, 2002, and reply comments were filed on April 29, 2002. We have taken the comments into account, as appropriate, in finalizing this order.

Findings of Fact

1. Roseville has taken language of D.00-11-039 out of context and assigned it meanings not intended by the Commission.

2. The second full paragraph on page 60 of D.00-11-039 focuses on the recovery of the $11.5 million EAS payment, and has nothing to do with Roseville's draws from the CHCF-B as a result of serving high cost areas.

3. Payments ILECs receive from the CHCF-B for serving high cost areas do not constitute a subsidy as those carriers must reduce their rates by the same amount.

4. A.99-08-043 dealt exclusively with Roseville's recovery of the $11.5 million EAS payment Roseville previously received from Pacific, and did not address any changes to operation of the CHCF-B.

5. Payments Roseville makes to the CHCF-B do not come from Roseville's resources, but from its ratepayers, in the form of a surcharge assessed on customers' bills.

6. The EAS payment that Pacific previously made to Roseville came from Pacific's resources.

7. The CHCF-B as formulated in D.96-10-066 does not provide any new money to carriers. Any carrier that receives a draw from the CHCF-B must reduce its rates by the same amount.

Conclusions of Law

1. D.00-11-039 does not overturn or modify D.96-10-066.

2. The four sections of D.00-11-039 that Roseville cited do not constitute legal error.

3. Roseville's requests for clarification of language in D.00-11-039 should be denied.

4. The CHCF-B is not an appropriate permanent source of funding to replace the $11.5 million payment to Roseville from Pacific.

5. Significant changes would have to be made to the CHCF-B in order for it to be used for permanent draws of a fixed amount.

6. Roseville's request for modification of D.00-11-039 should be denied.

ORDER

IT IS ORDERED that Roseville Telephone Company's Petition for Clarification/Modification is denied.

Dated ____________________, at San Francisco, California.