II. Background
On October 9, 1997, the Commission instituted this formal rulemaking proceeding and investigation to achieve several goals regarding Pacific Bell Telephone Company's (Pacific) and Verizon California Inc.'s (Verizon)4 OSS infrastructure. One objective of this docket (the OSS OII/OIR) is to assess the best and fastest method of ensuring compliance if the respective OSS of the ILECs do not show improvement or meet pre-determined standards of performance. Another related objective is to provide appropriate compliance incentives under Section 271 of TA96, which applies solely to Pacific,5 for the prompt achievement of OSS improvements.
To further these specific objectives, the ILECs and a number of interested CLECs have collaborated in the OSS OII/OIR proceeding and the 271 review process.6 The work and accomplishments in these proceedings that relate to performance incentives plan development have been summarized in D.01-05-087 (performance measurements) and D.01-01-037 (performance assessment or evaluation).
Following the Commission's adoption of the performance assessment model on January 18, 2001, Administrative Law Judge (ALJ) Reed convened a three-day facilitated workgroup on February 7, 8, and 9.7 The purpose of the workshop was to begin development of a payment structure that would determine the recipients and the amounts of payments (performance incentives) by the ILECs for deficient OSS performance. Specifically, the workshops were convened to seek agreement on the scope, issues, principles or goals, elements, and concepts for the payment structure. The ALJ's ruling also presented an initial list of issues for this phase of the proceeding. In a ruling on March 2, 2001, the ALJ summarized the results of the three days. Attached to the ruling were thirteen documents identified as 2001 CPUC Workpapers # 16 through # 28. Workpapers # 16 through # 18 listed the incentive plan issues, goals, and elements discussed by the workgroup. Parties collectively edited these documents to achieve a common understanding of the concepts presented.8 However, as the ALJ stated in her ruling, these documents did not necessarily represent any agreement between parties or any parties' position, but provided an informal guide for the parties to assess the completeness of any subsequent performance incentives plans.
At the end of the workgroup sessions, the parties discussed different schedules for plan submission and a comment period. No agreement was reached. Pacific insisted on an eight-week schedule. The CLECs insisted on a minimum of twelve weeks. On March 2, 2001, Pacific filed a motion asking the Commission to expedite the plan development process by approving an updated version of the plan it submitted during the workgroup sessions. On March 9, 2001, Pacific filed a correction to its proposed plan. On March 12, 2001, the CLECs submitted a motion requesting that the Commission "establish an appropriate schedule for the consideration of an incentives program," or in the alternative, deny Pacific's motion. On March 20, 2001, the assigned Commissioner issued a ruling (ACR) setting a schedule for submitting and commenting on plan proposals from the parties. The ACR allowed time for all active parties to file updated plans and specified a schedule and guidelines for Pacific and Verizon "running" the plans on historical OSS performance data9 as well as data simulating different performance levels.10 The purpose of these data runs was to determine the outcomes of the various plans given historical and potential future performance. Minor adjustments to the ACR's schedule had to be made to allow parties to make corrections to their plans and then to provide comment opportunities. The data runs and comments were completed by June 8, 2001. Appendix A lists the filings that contain each party's latest plan, the data runs for each plan, and the subsequent filings that contain parties' comments on these plans.
4 Verizon was previously named GTE California Incorporated. Hereafter, Pacific and Verizon will be referred to collectively, as the ILECs. 5 As a Bell Operating Company (BOC), Section 271 specifically applies to Pacific. 6 From July through mid-August 1998, Pacific, AT&T Communications of California Inc. (AT&T), MCI WorldCom (MCI W), Sprint Communications, Electric Lightwave, Inc., ICG Telecom Group, Inc., Covad Communications (Covad), MediaOne Telecommunications of California, Inc., Cox California Telecom, LLC, Northpoint Communications, California Cable Television Association, and staff entered into a collaborative process and jointly worked on developing solutions to the flaws in Pacific's 1998 draft 271 application. Verizon observed one collaborative meeting on penalties, but otherwise did not participate. (Verizon Response to Motion to Accept Joint Comments regarding Report on Performance Incentives, footnote 2 at 2 (October 20, 1998)). 7 Administrative Law Judge's Ruling Scheduling Facilitated Work groups in the Performance Incentives Phase, issued January 26, 2001. 8 Pacific Bell submitted Workpapers #19, #20, #22, and #23, the CPUC Office of Ratepayer Advocates (ORA) submitted Workpaper #24, and the CLECs submitted Workpapers #25 and #26 to illustrate concepts these respective parties believed to be important for any plan. Pacific, the CLECs, and Verizon each submitted plan drafts identified as Workpapers #21, #27, and #28, respectively. While the ALJ's ruling convening the workgroup did not solicit plans from the parties, these parties elected to submit plans for discussion purposes during the workgroup sessions. 9 Pacific calculated these figures. Due to parties' insistence that performance data is proprietary, all parties have not had access to all the data. Only Pacific and Verizon have had access to all the data necessary to complete the historical data runs. 10 Anticipating that actual performance would change over time, the ACR requested simulated data runs in order to assess how the different plans would address improving or deteriorating performance. Since the simulations depended on actual "sample sizes" and parties also consider this information proprietary, Pacific and Verizon were also the only parties in the position to complete the simulation runs.
