10. Assignment of Proceeding
Susan P. Kennedy is the assigned Commissioner and Timothy Kenney is the assigned ALJ in this proceeding.
1. RRLD is authorized by D.01-06-047 to provide intraLATA and interLATA telecommunications services as a nondominant interexchange carrier (IEC).
2. RRLD is owned by Visia.
3. Dominion purchased Visia from David Butler and BSM in early 2004. The purchase enabled Dominion to obtain indirect control of RRLD.
4. In A.04-05-034, as amended, RRLD, Visia, David Butler, and BSM jointly request authority under Section 854(a) to transfer indirect control of RRLD from David Butler and BSM to Dominion.
5. Notice of A.04-05-034 and the amendment to A.04-05-034 appeared in the Daily Calendar. There were no protests or other responses.
6. The transaction for which authority is sought in A.04-05-034 was consummated several months before A.04-05-034 was filed and without prior approval from the Commission.
7. Dominion has sufficient financial resources and expertise to acquire and operate RRLD in a way that serves the public interest.
8. The record of this proceeding indicates that approval of A.04-05-034 will not adversely affect RRLD's customers, other utilities, or the public at large.
9. Approval of A.04-05-034 may benefit the public by enhancing RRLD's ability to improve and/or expand its services in California.
10. California derives substantial benefits from the services provided by nondominant public utilities such as RRLD.
11. It is in the public interest for the Commission to foster a business environment that is hospitable to nondominant utilities.
12. For the reasons set forth in the two previous Findings of Fact (FOFs), it is in the public interest to approve ordinary business transactions by nondominant utilities that are subject to Section 854(a), like the transaction at issue in this proceeding, absent a compelling reason to the contrary. No such reason has been alleged or shown in the instant proceeding.
13. In D.98-12-075 the Commission adopted the following criteria for determining the amount of a fine: (i) the severity of the offense, (ii) the conduct of the offender, (iii) the financial resources of the offender, (iv) the totality of the circumstances, and (v) the role of precedent.
14. The Applicants' and Dominion's failure to comply with Section 854(a) was a single violation that did not (i) result in actual or threatened harm to others, or (ii) significantly benefit the Applicants or Dominion.
15. The Applicants and Dominion did not disclose their violation of Section 854(a) until prompted by the assigned ALJ.
16. The Applicants and Dominion have relatively modest financial resources. RRLD's revenues from its operations in California are de minimus.
17. The facts of this proceeding are reasonably comparable to those in previous opinions wherein the Commission imposed fines of $5,000 for violations of Section 854(a).
18. Fining the Applicants and Dominion for violating Section 854(a) will help to deter future violations of the statute by the Applicants, Dominion, and others.
19. The Applicants represent that granting A.04-05-034 will not result in (i) any new construction, (ii) changes in operations, or (iii) changes in use of existing property or facilities.
20. Based on the previous FOF, it can be seen with certainty that granting A.04-05-034 will not have an adverse impact on the environment.
1. This is a ratesetting proceeding.
2. There is no need for a hearing in this proceeding.
3. Section 854(a) requires Commission authorization to transfer control of a public utility. Any transfer of control without Commission authorization is void under the statute.
4. Application 04-05-034 is subject to Section 854(a).
5. The Commission has broad discretion under Section 854(a) to approve, modify, or reject a proposed transfer of control.
6. A.04-05-034 should be granted pursuant to Section 854(a) for the reasons set forth in the body of this opinion and FOFs 5 and 7 through 12.
7. The authority granted by today's opinion pursuant to Section 854(a) should apply prospectively. Retroactive authority should not be granted.
8. The Applicants and Dominion violated Section 854(a) by consummating the transaction described in A.04-05-034 without Commission authorization.
9. Section 2107 provides the Commission with authority to impose a fine of between $500 and $20,000 for violations of the Public Utilities Code.
10. RRLD should be fined for violating Section 854(a). The amount of the fine should be based on the criteria set forth in D.98-12-075.
11. Applying the criteria in D.98-12-075 to the facts of this case, which are identified in the body of this opinion and FOFs 14 through 18, indicates that RRLD should pay a fine of $5,000 for violating Section 854(a).
12. For the reasons set forth in FOFs 19 and 20, it is not necessary to conduct an environmental review of the transaction described in A.04-05-034.
13. The following order should be effective immediately.
IT IS ORDERED that:
1. Application 04-05-034 is granted to the extent it requests prospective authority under Pub. Util. Code § 854(a), effective as of the date of this Order, to transfer indirect control of Reduced Rate Long Distance, LLC (RRLD) from David Butler and the BSM Family Limited Partnership to the Dominion Business Group, Inc. The Application is denied to the extent it requests retroactive authority for the transfer.
2. RRLD shall notify the Director of the Commission's Telecommunications Division in writing of the transfer of control, as authorized herein, within 10 days of this Order. A true copy of the instrument(s) of transfer shall be attached to the notification.
3. RRLD shall pay a fine of $5,000 for violating Pub. Util. Code § 854(a). Within 30 days from the effective date of this Order, RRLD shall remit to the Commission's Fiscal Office at 505 Van Ness Avenue, Room 3000, San Francisco, CA 94102, a check for $5,000 made payable to the California Public Utilities Commission. The Decision number on the first page of this Opinion shall appear on the face of the check.
4. Application 04-05-034 is closed.
This Order is effective today.
Dated September 2, 2004, at San Francisco, California.
MICHAEL R. PEEVEY
President
GEOFFREY F. BROWN
SUSAN P. KENNEDY
Commissioners
I will file a dissent.
/s/ CARL WOOD
Commissioner
I reserve the right to join Commissioner Wood's dissent.
/s/ LORETTA LYNCH
Commissioner
