Discussion

The sole issue in this proceeding is whether the 1.544 Mbps/DS-1 circuits ordered by Pac-West should be priced at Pacific's TMEPS or TMECS tariffed rate. We find that Pac-West is eligible for the TMEPS rate.

Pacific's Schedule Cal. P.U.C. No 175-T 7.5.8(C)(1) for high capacity digital special access services provides two monthly channel termination rates per point of termination for DS-1 1.544Mbps Service-the TMECS rate at an end-user location¹ and the TMEPS rate at an IC² POT location.

Pacific's tariff defines POT, a point of termination, as:

The point of demarcation, within a premises at which the Utility's responsibility for the provisioning of service ends.

In interpreting tariffs, the Commission has held that the tariff language must be construed as a whole, and should be given a fair and reasonable construction that avoids absurd results or would render some part of the tariff a nullity. (See Decision (D.) 98-12-086, 1998 Cal. PUC LEXIS 1014, **19-20.) Under the plain meaning of the tariff, the tariff provides two rates at two locations. Because one rate is at an IC POT location, a carrier such as Pac-West reasonably would believe it was eligible for the TMEPS rate.

Pac-West orders a DS-1 circuit from Pacific to a Pac-West location at or near Pac-West's customer's premise. That location is the site for Pac-West's equipment, including Channel Service Units (CSU), and the point of termination where Pacific terminates the circuit. Pac-West can serve multiple end-users with the capacity provided by the DS-1 circuit. Pac-West uses the DS-1 circuits in combination with other Pac-West provided transmission facilities and switching equipment to create the Pac-West network. Pac-West's DS-1 configuration corresponds to the configuration described in Pacific's Technical Publication, a configuration that corresponds to the TMEPS rate.

Pacific disagrees with Pac-West's characterization of its network and states that Pac-West's circuits terminate at Pac-West's end-user's locations and are subject to the TMECS rate. Pac-West's operations differ from Pacific's. Pac-West rents DS-1 circuits from Pacific and alters those circuits to create a unique resale environment that is not part of Pacific's network. Pac-West then uses its own equipment and facilities to connect to the facilities of its customers and the circuits provided by Pacific do not terminate at the customer's facilities. Thus Pacific terminates its circuits at the Pac-West's facilities, not at the end-user's. Schedule Cal. P.U.C. No 175-T 7.5.8(C)(1) charges $71.12 monthly for channel termination at an IC POT location. Under a reasonable interpretation of Pacific's tariff, Pac-West is eligible for the lower TMEPS rate.

Pacific avers D.88-08-059 dictates the interpretation of Pacific's tariff. Pacific states the end-user to central office link would be priced at the same rate whether provided by the local exchange carrier (LEC) to an end-user or whether provided by the LEC to a competitor as part of the access service connecting the competitor's network to the competitor's customer. (D.88-09-059, Appendix A, p. 9.) The distinction Pacific references, although found in the settlement agreement, is not contained in its tariff. Under the tariff a customer purchasing a DS-1 circuit finds a rate for an end-user location and a POT location. If the intended termination point is the purchasing carrier's facilities, that carrier would assume it could purchase the circuit at the TMEPS rate. However, we must determine whether we approved a different result.

D.88-08-059 approved a modified settlement agreement among a number of parties, including Pacific. Pac-West was not a party to the proceeding or the settlement agreement. In describing the settlement agreement, we stated it included restructured offerings that contained a common element for service from an end-user's premises to the local exchange carrier's central office and a distinct element for service from the interexchange carrier's point of presence (POP). (D.88-08-059, 29 CPUC 2d, 11, 42.) We adopted that portion of the settlement agreement. The settlement agreement, found in an appendix to the decision, contained the statement:

This element [IC/POP connection] will be priced at the same rate, whether provided by the LEC to an end user as part of the LEC's end-to-end intraLATA service or whether provided by the LEC to a competitor as part of the access service connecting the competitor's network to the competitor's customer. (Id. at Appendix A, p. 58.)

We did not discuss that portion of the settlement agreement in our decision adopting it. Although Pacific's interpretation of the settlement provision is a reasonable one and could have been the intent of the parties to the settlement agreement, we decline to impose it on Pac-West. Rule 51.8 of our Rules of Practice and Procedure provides that our adoption of a settlement agreement is binding on all parties to the proceeding in which the settlement is proposed. Unless we provide otherwise, such adoption does not constitute approval of or precedent regarding any principle or issue in the proceeding or in any future proceeding. Because Pac-West was not a party to the settlement agreement and we did not discuss that provision or make it precedential, we cannot now do so.

Pacific also avers that our decision to price private lines and special access identically in D.94-09-065 is further support for its position that the TMECS rate should apply to Pac-West's DS-1 circuits. However, we did not endorse Pacific's interpretation of the tariff in D.94-09-065. We merely approved existing pricing and consolidated private line and special access services.

Pac-West can purchase DS-1 circuits at the TMEPS rate. Pacific incorrectly determined that Pac-West was not eligible for that rate. Pacific shall refund to Pac-West charges in excess of the TMEPS rate paid by Pac-West and shall adjust all invoices to reflect the correct rate.