4. Financial Qualifications

Pursuant to Rule 4.B of Decision (D.) 95-12-056, an applicant for a CPCN for authority to provide facilities-based local exchange service must demonstrate that it has $100,000 cash or cash equivalent to meet the firm's start-up expenses. Applicant must also demonstrate that it has sufficient additional resources to cover all deposits required by other telecommunications carriers in order to provide service in California.

In Section 6 of, and Exhibit 5 to the application, Plumas provided a copy of audited financial statements for the most recent year ending December 31, 2009. The audit is the consolidated audit of Plumas Sierra Rural Electric Cooperative and all Subsidiaries, one of which is Plumas Sierra Telecommunications. In addition, Plumas submits its most recent bank statement, showing that cash on hand is in excess of the $100,000 requirement for a full facilities-based Applicant. Plumas states that the financial statements and the bank statement demonstrate that it possesses a minimum of $100,000 of unencumbered cash, reasonably liquid and readily available, to meet the expenses of the operation.

Appendix E, Section 4, of D.96-02-072 provides a list of the financial instruments that may satisfy the applicable unencumbered case requirement. That list does not include bank statements. However, the audited financial statements provided by Plumas do show that Plumas Sierra Telecommunications did have the minimum required amount of cash on hand. Since Plumas has provided documentation through a consolidated financial statement that it and its parent possess more than a minimum of $100,000 that is reasonably liquid and available, it has demonstrated that it has sufficient funds to meet its start-up expenses and has fulfilled this requirement. Plumas has also demonstrated that it has sufficient funds to pay future deposits that may be required by other telecommunications carriers in order to provide service in California.