III. Environmental (CEQA) Review

The CEQA (Public Resources Code Sections 21000 et seq.) applies to discretionary projects to be carried out or approved by public agencies. A basic purpose of CEQA is to "inform governmental decision-makers and the public about the potential significant environmental effects of the proposed activities." (Title 14 of the California Code of Regulations, hereafter CEQA Guidelines, Section 15002.)

Since the Commission must issue a discretionary decision (i.e., grant Section 1001 certificate authority) without which the proposed activity will not proceed, the Commission must act as either a Lead or Responsible Agency under CEQA. The Lead Agency is the public agency with the greatest responsibility for supervising or approving the project as a whole (CEQA Guidelines, Section 15051(b)). The Commission is the Lead Agency for this project under CEQA. CEQA requires that the Commission consider the environmental consequences of a project that is subject to its discretionary approval.

Applicant seeks authority in this application to modify its existing CPCN to include full facilities-based competitive local exchange, access and non-dominant interexchange service. Applicant initially filed this application on July 27, 2005, and filed a supplement to the application on November 2, 2005 (Supplement) and a second supplement on February 17, 2006. Although Applicant did not file a Preliminary Environmental Assessment with the application, Applicant provided additional information in the Supplement to address compliance with Rule 17.1 of the Commission Rules of Practice and Procedure and the degree to which its planned outside construction implicates CEQA. In its application and Supplement, Applicant outlined its projected business activities and described the types of facilities it may utilize and construct, including their geographical location and extent. The application and Supplement provide adequate information to determine the environmental impacts (if any) of such activities and the degree to which such activities and facilities may be exempt from further CEQA review.

In its application and Supplement, Applicant states that its business activities associated with the installation of its Distributed Antenna System (DAS) facilities are so limited that they should potentially qualify for a number of categorical exemptions available under CEQA. In its Supplement, Applicant provides two attachments to support its case. Attachment A provides a description of the types of facilities involved in a DAS network, and Attachment B provides both a proposed procedure by which Applicant would provide notice of the claimed exemption, and a detailed list of existing CEQA categorical exemptions that would apply to the installation of DAS facilities by Applicant.

Applicant has proposed the following procedure for obtaining Commission approval of its claimed CEQA exemptions for proposed construction projects:

· Applicant will provide the Commission Energy Division with:

o A detailed description of the proposed project, including:

· Customer(s) to be served;

· The precise location of the proposed construction project; and

· Regional and local site maps.

o A description of the environmental setting, to include at a minimum:

· Cultural, historical, and paleontologic resources;

· Biological resources; and

· Current land use and zoning.

o A construction workplan, to include:

· Commission Preconstruction Survey Checklist-Archaeological Resources;

· Commission Preconstruction Survey Checklist-Biological Resources;

· A detailed schedule of construction activities, including site restoration activities;

· A description of construction/installation techniques;

· A list of other agencies contacted with respect to siting, land use planning, and environmental resource issues, including contact information; and

· A list of permits required for the proposed project.

o A statement of the CEQA exemption(s) applicable to the proposed project; and

o Documentation and factual evidence sufficient to support a finding that the claimed exemption(s) is (are) applicable.

· The Commission Energy Division will review the Applicant's submission for the proposed project to confirm that the claimed exemption(s) from CEQA are applicable.

· Within 21 days from the date of Applicant's submittal, the Commission Energy Division will issue either:

o A Notice to Proceed (NTP) and file a Notice of Exemption with the State Clearinghouse, Office of Planning and Research, or

o A letter of denial stating the specific reasons why the claimed exemption(s) are not applicable to the proposed project.

The application makes clear that Applicant's facilities-based DAS projects will consist of: predominantly aerial fiber optic facilities; the installation of compact "nodes" on existing utility poles; a minor amount of ground disturbance (100 - 200 feet) associated with connecting equipment enclosures on private property with the aerial right-of-way; and aerial fiber runs of short distances, rarely exceeding 1,000 feet in length. All facilities will be located within public utility rights-of-way (with the exception of ingress and egress to and from the facilities). The projects and facilities will be widely separated geographically.

We have carefully reviewed the application and Supplement and find that:

· Applicant's proposed facilities-based project activities are very limited;

· These activities would in almost all circumstances be very likely to qualify for an exemption from CEQA; and

· The proposed process for reviewing the applicability of CEQA exemptions to Applicant's DAS facilities-based projects is not only adequate for the Commission's purposes as CEQA Lead Agency, but is also in the public interest because it enables Applicant to respond in a timely manner to WSPs' requests for service without the delay or burden of a full CEQA review when such review is unnecessary.

We therefore approve Applicant's proposed process for Commission review of claimed CEQA exemptions for construction projects undertaken pursuant to Applicant's full facilities-based authority, based on the specific facts of this case with the following modifications related to the Commission Energy Division's review and approval or disapproval of the proposed exemptions.

· If the Commission Energy Division disapproves Applicant's claimed CEQA exemption(s), and issues a letter of denial to Applicant, Applicant shall either re-design the specific project and facilities and then reapply for a finding of exemption from CEQA, or file a formal application with the Commission seeking the requisite approval and full CEQA review, before commencing any construction activities.

Applicant shall not perform any full facilities-based construction activities without first obtaining an NTP from the Commission Energy Division or authorization by the Commission after the requisite environmental review.

However, the Commission is reviewing CEQA issues affecting telecommunications providers on a broader, policy level in Rulemaking (R.) 00-02-003. Applicant may utilize the above process for obtaining Commission review, and approval or disapproval of, proposed CEQA exemptions unless or until the Commission adopts different requirements applicable to Applicant in R.00-02-003 or a subsequent proceeding.