Decision 08-11-036 November 6, 2008
Before The Public Utilities Commission Of The State Of California
Verizon California, Inc. a California corporation (U1002C), Complainant, vs. Paul M. Carrick III, an individual; Robert Mitchell Herman as Trustee of the Herman Family Trust, an individual; John N. Dukes, an individual; Gwyneth F. Dukes, an individual; Sidney Sue Slade as Successor Trustee of the MacDonald Family Trust UAD October 18, 1979, an individual; Paul R. Wilens, an individual; Cathy Wilens, an individual; Ramon Arredondo, an individual; Alice M. Reed, an individual; Sherry L. Wothers, an individual; Lawrence H. Selman, an individual; Martha Jean Selman, an individual; Brian Bean, an individual; Lawrence L. Howard, an individual; Armen Markarian, an individual; Hearst-Argyle Stations, Inc., a Nevada corporation; Consuelo L. Hernandez, an individual; Alan H. Reid, an individual; Kathleen Reid, an individual; Robert W. Tucker, an individual; Shelley Tucker, an individual; Leonard Steven Johnson, an individual; James P. Boyle, an individual; Angela M. Boyle, an individual; Elena Rauen, an individual; Kent A. Uhlenhopp, an individual; Shanne Carvalho, an individual; Barry Wothers, an individual; John Moore, an individual; Robert Ronald Cash, an individual; David Ow, an individual; Judd Wiesjahn, an individual; Annalisa Wiesjahn, an individual; Camilo Wilson, an individual; Anna Wilson, an individual; Irene Hall, an individual; Sarah Apostoleris, an individual; Jeff L. Osborn, an individual; Dana Matthew-Osborn, an individual; Stanley Towle, an individual; Cynthia A. Bird, an individual; Donald Brown, an individual; Charles W. Brown, an individual; David Tymn, an individual; Mark S. Hamlin, an individual; Thomas E. Atchison II, an individual; Rhonda Atchison, an individual; Faydra Atchison, an individual; Richard L. Wakeman, an individual; Dana Wakeman, an individual; The D'Orio Family, a limited partnership; Alicia P. Herman, an individual; Charles R. Cortsen, an individual; Susan P. Cortsen, an individual; Beatrice Supnet, an individual; Richard Nathanson, an individual; Xuan T. Casey, an individual; Yossef Zaguri, an individual; Arlette Sabag-Zaguri, an individual; Maryann C. Parsons, an individual; Debrae Joan Lopes, an individual; Michele Margaret Landegger, an individual; Richard Nohrden, an individual; Jeffery J. Bradford, an individual; Scot S. Reid, an individual; Julie W. Reid, an individual; William A. Pryce, an individual; June R. Pryce, an individual; Sanjay Iyer, an individual; Asha Pandya, an individual; Richard C. Goldsmith, an individual; Laurie B. Goldsmith, an individual; Summit Road Association, an entity of unknown form, Defendants. |
(EDM) Case 07-11-019 (Filed November 28, 2007) |
ORDER DENYING APPLICATION FOR REHEARING OF
DECISION 08-06-021
I. INTRODUCTION
On July 16, 2008, the Summit Road Association, et al. (SRA or defendants), on behalf of itself and the named defendants, filed an application for rehearing of Decision (D.) 08-06-021; in addition, as a part of its rehearing application, SRA requests an oral argument.
In late November 2007, Verizon filed the underlying complaint, Case (C.) 07-11-019, to condemn reciprocal negative easements in a five-mile stretch of property on Summit Drive in Santa Clara and Santa Cruz Counties owned by individual property owners and a voluntary group of owners, collectively known as the Summit Road Association, in order to construct an underground portion of its 26-mile Inter Office Fiber (IOF) project. Verizon stated the purpose of the IOF project is to increase system reliability for Verizon and to remedy inadequate data transmission capabilities out of its Morgan Hill and Gilroy offices.1 In pursuit of the IOF project Verizon has already obtained permits and extended underground cable on municipal portions of Summit Road extending about nine miles northwest from Gilroy and 12 miles southeast from Los Gatos. The remaining five miles of the IOF project is located on the private portion of Summit Road belonging to the defendants that lies between the two already constructed extensions.
The permanent facilities Verizon seeks to construct in the easement consist of a four-inch conduit located between four and six feet under Summit Road, as well as underground vaults with equipment connected to the cable that is to be located alongside the road. In about the mid-1990s, Verizon's predecessor, Contel of California, obtained an easement from property owners along Summit Road and installed copper-based telephone facilities along the road for use in providing basic telephone service in that area. The copper wires are not capable of providing telephone services to all purportedly interested residents and, due to obsolescence and failure-prone equipment, are subject to frequent outages. According to Verizon, about 250 customers located along portions of Summit Road already served by the IOF fiber-based project have purchased high-speed fiber-based internet access. While six customers are currently served by Verizon's copper-based landline service, it estimates that with the private section of Summit Road completed, there will be sufficient capacity to serve up to 200 additional customers with landline telephone service. Of those, up to 144 could purchase and receive DSL. The defendants argued that the current residents of Summit Road have no need for the additional capacity the IOF project may provide and contended that the real purpose for the project is to provide Verizon with a competitive advantage.
As initially proposed, Verizon would have used trenching and backfilling in the roadway to complete its project. Those are techniques it used on the other already completed portions of Summit Road and SRA argued that Verizon had done a poor job of completing the trenching work in those areas and of repairing damage allegedly caused by the original Contel trenching on the private section of Summit Road. The private portion of Summit Road is an environmentally fragile dirt road dating from the 1880s that receives about 30-40 inches of rain annually and sometimes snow and ice, and the defendants are concerned that Verizon's proposed work will render the private portion of Summit Road impassable. The defendants contend that trenching causes erosion and uneven surfaces and that Contel's trenches caused SRA additional annual maintenance expenses. The owners of the private portion of Summit Road are solely responsible for maintaining that section of the roadway. A Santa Clara County engineering report concluded that trench cuts do weaken the soil adjacent to the cuts and that additional road strengthening is required. However, Verizon revised its initial proposal, in order to cause fewer, if any, disturbances to the roadway, and intends to use directional boring to place the conduit for the fiber optic cable.2 Verizon's expert roadway witness testified that by using directional boring roadway erosion concerns and subsidence would be eliminated and the surface restoration work to Summit Road would be "wholly unremarkable and conventional."
At the time of the hearing before this Commission, Verizon had already spent about $3.3 million on the 21 completed miles of the IOF project. Verizon estimated that 65,000 residential and 80,000 business customers will benefit from the project. SRA argued that there is no need for Verizon's landline service because Summit Road residents can obtain wireless and satellite telephone and internet services. Further, they believed the IOF project is unnecessary that because Verizon already leases line capacity from AT&T and could continue to do so. SRA argued that in the alternative, even if an additional Verizon trunk line were needed, Verizon should have constructed it instead through the metropolitan areas-along Highway 101-using public right-of-ways, rather than the 26 mile stretch of Summit Road.
D.08-06-021 determines that the construction disturbance will impact less than 2% of the roadway surface on that private portion of Summit Road and should not result in any change to the ultimate use of the private portion of Summit Road. In order to ensure that Verizon repairs any damages to the private roadway caused by its facilities or construction we adopted "Implementation Requirements" which place Verizon under a continuing obligation to repair any damages caused by the project. Based on the record before us, we determined that the public benefits of the IOF project are significant and that neither of the defendants' two proposed alternatives to the project would extend basic telephone service or advance telecommunications services into underserved areas.
In its application for rehearing, SRA contends that it did not have adequate time, materials or opportunity to present its case. SRA alleges that the challenged decision is unconstitutional because the objective behind the civil eminent domain action is Verizon's profit rather than public need. In addition, SRA contends that D.08-06-021 caps Verizon's potential liability for damages without any factual information regarding possible damages. Further, SRA takes issue with the order that it and Verizon mediate any future construction-related problems, including currently unknown engineering proposals, before our Communications Division Director. SRA also contends that the Implementation Guidelines adopted are illusory because it alleges they are based on proposals that were never submitted into evidence. SRA demands as part of its application for rehearing that it receive a copy of the construction proposal. In addition, SRA requests an oral argument. Verizon filed a timely response opposing the application for rehearing and the request for oral argument.
We have reviewed each and every allegation of error raised by SRA as well as its reasons for requesting oral argument and find, as discussed below, they are without merit and there is no good cause for granting the request for oral argument. Accordingly, we deny the defendants' application for rehearing and request for oral argument.
1 In 2004, Verizon initially filed a civil complaint for eminent domain in the Santa Clara Superior Court. In its complaint, Verizon argued that Public Utilities Code section 616 empowered it to condemn the property at issue because it is necessary to the construction and maintenance of its telephone line. (Hereinafter all statutory references are to the Public Utilities Code unless otherwise indicated.) Verizon also argued that section 625 did not pertain to the action. The defendants argued that section 625 is applicable and in 2007 the superior court judge bifurcated the issue of whether section 625 was applicable. The superior court stayed its proceedings and ordered Verizon to obtain a determination from this Commission regarding the applicability of section 625.
2 See D.08-06-021 at page 6, footnote 5 for a description of directional boring.
