II. Background
Choctaw is authorized by D.98-07-028 to provide resold local exchange service. Choctaw's only current offering is prepaid local exchange service.
Choctaw provides its service with "no credit check, no ID, and no deposit.1" As a result, many of Choctaw's customers are persons who are unable or unwilling to obtain service from incumbent local exchange carriers (ILECs) or competitive local carriers offering traditional postpaid service.
To be a successful provider of prepaid service, Choctaw must guard against the possibility that a customer will incur a bill that exceeds the amount of prepayment. This is because Choctaw's customers often do not pay for service after the fact, since many are credit challenged and/or take service for only a short period of time. To protect itself, Choctaw offers only fixed-rate services that can be fully paid for in advance, i.e., services that provide an unlimited amount of usage for a fixed fee. With one exception, described below, Choctaw does not offer any services that have per-call charges, since such services may enable customers to incur bills that exceed the prepaid amount.
Choctaw provides service by reselling the services offered by the ILECs. The rate structure for the ILECs' MRS consists of a flat monthly fee plus a per-call charge. The ILECs do not provide MRS in a way that tracks per-call charges in real-time and immediately terminates service when the prepaid amount falls to zero. Consequently, Choctaw does not offer MRS to most of its customers, since MRS usage charges could exceed the amount of prepayment. Rather, Choctaw offers only flat-rate local service to most of its customers. The only customers of Choctaw that have access to MRS are subscribers to Universal Lifeline Telephone Service (ULTS).2 ULTS includes access MRS pursuant to D.96-10-066, D.00-10-028, and General Order 153.
Given the need to block calls that result in per-call charges, Choctaw submitted with its application for a certificate of public convenience and necessity (CPCN) a draft tariff that included the following text:
The following types of calls and services may be blocked by the Company: long distance; collect calls; operator-assisted calls; third number billed calls; or any service that may be billed to the Customer's telephone number.
In D.98-07-028, the Commission granted Choctaw's application for authority to provide local exchange service.3 The Commission also found in D.98-07-028 that Choctaw's draft tariff complied with all Commission requirements.4 Choctaw's initial tariff mirrored its draft tariff.
UCAN filed its complaint on April 27, 2000. In its complaint, UCAN alleged that Choctaw has not provided various types of services required by the Commission, including MRS. Choctaw filed its answer to the complaint on June 15, 2000. In its answer, Choctaw denied UCAN's allegations. With respect to MRS, Choctaw admitted that it does not offer MRS, but denied that it is required to do so by the Commission.
A prehearing conference (PHC) was held on September 15, 2000. Written PHC statements were filed and served by UCAN and Choctaw prior to the PHC. During the PHC, the parties indicated a desire to settle all issues, and asked assigned Administrative Law Judge (ALJ) Kenney to suspend the proceeding pending settlement negotiations. The assigned ALJ granted the parties' request.
On September 19, 2000, UCAN notified the assigned ALJ by e-mail that the parties had met and resolved all outstanding issues, and would likely submit a settlement agreement by the end of the month. UCAN also stated that there was no need to schedule hearings.
When no settlement was submitted, the assigned ALJ sent an e-mail to UCAN on November 6, 2000, asking for a status report. UCAN responded by e-mail the same day, stating that the parties were in the process of finalizing the settlement, and that the settlement would likely be submitted within two weeks.
Once again, no settlement was submitted. On February 22, 2001, the assigned ALJ issued a ruling that set a deadline of February 28, 2001, for the parties to file either (1) a settlement agreement, or (2) a motion for an extension of the 12-month deadline for concluding complaint proceedings. UCAN and Choctaw filed a settlement agreement on February 28, 2001.
1 http://www.smokesignal-clec.com/offer/index.html. 2 Choctaw is required to offer ULTS to qualified low-income households. There is no evidence in the record of this proceeding that Choctaw has any ULTS customers. 3 In D.98-07-028, the Commission granted a CPCN to "Choctaw Communications, L.C." In D.00-01-036, the Commission approved a transaction in which Choctaw changed to its present name (Choctaw Communications, Inc., d/b/a/ Smoke Signal Communications) and became a corporation rather than a limited liability company. 4 D.98-07-028, Finding of Fact No. 15.
