4. Substantial Contribution

In evaluating whether a customer made a substantial contribution to a proceeding, we look at several things. First, we consider whether the ALJ or Commission adopted one or more of the factual or legal contentions, or specific policy or procedural recommendations put forward by the customer. (See § 1802(i).) Second, if the customer's contentions or recommendations paralleled those of another party, we consider whether the customer's participation materially supplemented, complemented, or contributed to the presentation of the other party or to the development of a fuller record that assisted the Commission in making its decision. (See §§ 1802(i) and 1802.5.) As described in § 1802(i), the assessment of whether the customer made a substantial contribution requires the exercise of judgment.

Should the Commission not adopt any of the customer's recommendations, it may still award compensation if the customer's participation substantially contributed to the decision or order in other ways.

With this context in mind, we consider the contributions of each intervenor.

4.1 Greenlining

Greenlining's request identifies the following contributions:

Greenlining's participation assisted the Commission in guaranteeing benefits to low-income ratepayers and underserved communities. Greenlining's contribution is especially significant in three areas of the new Verizon's leadership role: supplier diversity, philanthropy, and bridging the digital divide.

Greenlining is responsible not just for what has been termed by the Commission as the "Greenlining Agreement," but also served as one catalyst for the Commission's decision to enlarge the new California Emerging Technology Fund from $60 million to $100 million. Greenlining is now working with Verizon, as well as AT&T [Pacific Bell Telephone Company], to leverage this amount to $189 million, and to grow the original Telemedicine Fund from $5 million to $30 million.

The Commission benefited from Greenlining's participation in this proceeding even where the Commission chose not to adopt all of Greenlining's specific recommendations. Therefore, full compensation is appropriate. (Greenlining Request, at 2-3.)

We find that Greenlining's participation in this proceeding and its leadership in crafting a settlement, a central part of the Commission's decision, made a substantial contribution to D.05-11-029. However, as discussed in the section regarding the reasonableness of its request, some of the time spent by Greenlining is disallowed for compensation.

4.2 LIF

LIF concentrated its efforts in this proceeding on demonstrating the existence of a "digital divide" in access to advanced telecommunications resources in underserved communities and in providing resources to remedy this problem. It took part in the settlement agreement that, among other elements, targeted underserved communities to receive a major share of increased philanthropy, and this contributed to the efforts of Greenlining in reaching settlement. We find that LIF's participation in this proceeding constituted a substantial contribution to D.05-11-029. However, as discussed in the next section regarding the reasonableness of its request, some of the time spent by LIF is disallowed for compensation.

4.3 Disability Rights Advocates

Disability Rights Advocates focused primarily on the needs of consumers with disabilities and the telecommunication barriers they face in light of the proposed merger. It acknowledges that none of its recommendations was adopted in the final decision, but asserts that its contribution was substantial in developing a thorough factual record. Verizon argues the compensation request of Disability Rights Advocates should be denied, commenting that not only did the final decision reject that agency's position as "highly dubious" and lacking "a credible basis" (Decision, at 87), so too did the Alternate Decision, which found that agency's concerns regarding degradation of service quality "dubious." (Alternate Decision, at 53.) Disability Rights Advocates responds that, as the only intervenor contributing factual evidence to the record regarding people with disabilities, its "substantial contribution ensured their needs were identified and thoroughly considered by the Commission."

Disability Rights Advocates points to the final decision's adoption of both the Greenlining settlement and the Community Emerging Technology Fund (CETF) as incorporating aspects of its recommendations so as to warrant compensation. The record does not support this claim. Disability Rights Advocates was a consistent critic of the Greenlining settlement from the outset, dismissing it as "entirely fail[ing] to address the needs of people with disabilities." (Comments, dated November 8, 2005, at 8.) By the same token, the final decision's creation of the CETF was modeled on the Greenlining settlement, broadband legislation (SB 909), and a similar fund adopted in the PG&E bankruptcy, and reflects no contribution on the part of Disability Rights Advocates.

Nevertheless, we find that some compensation should be awarded Disability Rights Advocates. In rare instances, we have compensated an intervenor, even where we rejected that intervenor's recommendations, where (1) the intervenor's participation directly furthers important public policy, and (2) the issues under consideration are particularly novel or complex. Those standards are met here.

Specifically, we want to take into consideration the needs of persons with disabilities, and we welcome Disability Rights Advocates' representation of those needs even where ultimately we reject its recommendations. Further, rapid changes in telecommunications technology and in the market for telecommunications services present issues that are both novel and complex.

Thus, we will partially compensate Disability Rights Advocates. Recognizing our rejection of all its recommendations, we will reduce the claim for professional hours by 50%.

4.4 TURN

TURN argued in its testimony and pleadings that insufficient local competition exists to offset negative competitive impacts of the merger. Although the final decision did not agree, the Commission did impose a requirement that Verizon offer stand-alone digital subscriber lines without a requirement that other bundled services be purchased. TURN also argued that all subdivisions of § 854 should apply to a merger of this magnitude, a position rejected by the final decision but supported by an Alternate Decision sponsored by Commissioner Brown. Commissioner Brown and Commissioner Grueneich in their dissents to the final decision and in a second Alternate Decision also agreed with TURN's position that evidentiary hearings should have been conducted by the Commission. Several merger conditions proposed by TURN and supported by the Commission's Office of Ratepayer Advocates (ORA)³ were not adopted by the final decision but were supported by the first Alternate Decision.

Verizon agrees that TURN is entitled to compensation in this proceeding, but it argues that the amount of the award should be reduced for three reasons: TURN's request exceeded the estimate set forth in the NOI; its Hirschman-Herfindahl Index (HHI) analysis and criticisms of the Attorney General's Opinion did not make a substantial contribution; and it seeks compensation for work on §§ 854(b) and (c) issues that was outside the scope after the assigned Commissioner ruled that those provisions were not applicable. Verizon also criticizes the number of attorneys and experts that TURN employed for this proceeding.

TURN responds that the Commission in D.03-04-034 confirmed that § 1804(b)(2) does not require a reduction in award because an NOI fails to mention all issues raised by an intervenor; the HHI analysis and the criticism of the Attorney General's Opinion "encourage[d] debate over the full range of legal, policy and implementation issues" (D.06-02-016, at 9-10) and found support in the Alternate Decision; and work on the §§ 854(b) and (c) issues was not outside the scope of the proceeding based on the ruling of a single Commissioner that was not endorsed by the full Commission until the final decision. As to its use of additional staff and consultants, TURN responds that Verizon itself suggested that TURN augment its resources if it was otherwise unable to meet the aggressive procedural schedule adopted in this proceeding.⁴

TURN acknowledges that the Commission's final decision did not adopt its recommendations. However, it believes that it made a substantial contribution because the decision addressed issues raised by TURN and an Alternate Decision relied on several of TURN's proposals. We agree that TURN made a substantial contribution in this proceeding. This proceeding exemplifies the kind of proceeding where, because of the importance and complexity of the policy issues addressed, an intervenor may substantially contribute by assisting the Commission to develop a comprehensive record, even though the Commission's decision may not have adopted the intervenor's recommendations on those issues.

³ Pursuant to Senate Bill 608, the Office of Ratepayer Advocates became the Division of Ratepayer Advocates, effective January 1, 2006.

⁴ See Applicants' Opposition to Intervenors' Motion for Modification of Procedural Schedule (September 8, 2005) ("To the extent that Moving Parties nevertheless have found themselves unable to manage the various proceedings, they should have augmented their resources. The CPUC's generous intervenor compensation program provides both the ability and the incentive to do so.")