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PA Bulletin, Doc. No. 06-594

NOTICES

2006 Price Change Opportunity Filing

[36 Pa.B. 1719]

Public Meeting
held March 2, 2006

Commissioners Present: Wendell F. Holland, Chairperson; James H. Cawley, Vice Chairperson, concurring and dissenting in part--statement attached; Bill Shane; Kim Pizzingrilli; Terrance J. Fitzpatrick

Verizon Pennsylvania Inc. 2006 Price Change Opportunity Filing; Doc. Nos: R-00051228 and P-00930715F1000

Office of Small Business Advocate v. Verizon Pennsylvania Inc.; Doc. No. R-00051228C0001

Office of Consumer Advocate v. Verizon Pennsylvania Inc.; Doc. No. R-00051228C0002

Order

By the Commission:

I.  BACKGROUND

   Before us for disposition is the Verizon Pennsylvania Inc. (''Verizon PA'' or ''Company'') annual 2006 Price Change Opportunity (''PCO'') filing and the associated revenue increases. Verizon PA's annual 2006 PCO filing was made under the provisions of the new Chapter 30 law, Act 183 of 2004, P. L. 1398 (66 Pa.C.S. §§ 3011--3019) (''Act 183'') and pursuant to the Company's Alternative Regulation and Network Modernization Plan (''Chapter 30 Plan'') that this Commission approved at Docket No. P-00930715F1000.1

   As a result of the passage of Act 183, companies with Chapter 30 Plans are entitled to significantly lower inflation offset values within their respective price cap formulas in exchange for a commitment to accelerated broadband deployment. Inflation offsets previously ranging from 2% to 2.93% were reduced to either 0% or 0.5%, depending on each company's Chapter 30 Plan. In Verizon PA's case, the inflation offset was reduced from 2.93% to 0.5%. Accordingly, annual PCO filings have the potential for substantial revenue and rate impacts on end-user consumers.

   Under the Company's Price Stability Mechanism (''PSM''), the PCO calculates the allowable change (increase or decrease) in rates for noncompetitive services based on the annual change in the Gross Domestic Product Price Index (''GDP-PI''). The PSM also contains special provisions for protected services and addresses revenue neutral adjustments to the rates of noncompetitive services. The PSM set forth in Verizon PA's Chapter 30 Plan is a complete substitution of the rate base/rate of return regulation. Noncompetitive services are defined as regulated services or business activities that have not been determined or declared to be competitive.

II.  COMPANY FILING

   On December 30, 2005, Verizon PA filed its annual PCO filing using the change in 2004 and 2005 second quarter GDP-PI (Gross Domestic Product--Price Index) of 2.66% that produced an overall 2.16% increase allowable for noncompetitive revenues. According to this filing, the Company is entitled to an annual revenue increase of $16,765,000. The proposed price increases equal $15,535,600. The Company proposes to bank the difference of approximately $1.2 million, consistent with the PCO banking methodology and timing that has been approved for Sprint/United.2

   Verizon PA proposes to implement its PCO by increasing rates for the following services: Residence and Business Dial Tone Line, Return Check Charge and certain Operator Surcharges on local calls. The proposed tariff revisions to Tariff Telephone Pa. P.U.C. Nos. 1, 180A, 182, 182A, 185B, 185C and 500 were filed to become effective March 1, 2006, and voluntarily postponed until March 3, 2006.

   Verizon PA requests permission to continue in 2006 to use the on-going value of its 2003 PCO to support the Company's payments to the Pennsylvania Universal Service Fund (''Pa. USF'') per the Commission's Order entered October 11, 2005, at Docket Nos. P-00930715 and P-00001854. Verizon PA also proposes to continue to bank the difference each year between the 2003 value of the PCO and its payments into the Pa. USF.

   Verizon PA also proposes to account for the two-month plus two-day delay in implementation of the 2006 PCO by using a portion of the banked value associated with the Company's 2003 PCO. Verizon PA states that in past years when the implementation of its PCOs was delayed past January 1st (e.g., during the Global proceeding), the financial impact of the delay was accounted for in some manner (e.g., support for the Company's Lifeline program).

   On December 30, 2005, the Office of Small Business Advocate (''OSBA'') filed a Formal Complaint. The OSBA contends that the Company's proposed rates, rules, and conditions of service may be unjust, unreasonable, unduly discriminatory, and otherwise contrary to law, particularly as they pertain to small business customers.

   On January 10, 2006, the Office of Consumer Advocate (''OCA'') filed a Formal Complaint. The OCA contends that the Company's proposed rates, rules, and conditions of service may be unjust, unreasonable, unduly discriminatory, and otherwise contrary to law. The OCA also disagrees with the Company's proposal to recover the two-month delay in implementation of the 2006 PCO and with the banking of the remaining 2006 PCO increase.

   On January 26, 2006, Verizon PA filed Answers to the complaints and Motions to Dismiss the complaints reaffirming its position on the various issues contained in the filing.

   On February 6, 2006, OCA and OSBA filed Answers to Verizon's Motion to Dismiss Complaint. On February 13, 2006, Joseph D. Wacker also filed a Formal Complaint.

III.  DISCUSSION

1.  PCO Calculations and Rate Increases

   The annual Verizon PA PCO submissions under Chapter 30 laws must conform to its Commission-approved Amended Chapter 30 Plan. Our review of the calculations submitted by Verizon PA indicates that they are accurate and consistent with the terms of the Company's Price Stability Mechanism/Price Change Opportunity formula approved in its Chapter 30 Plan at Docket No. P-00930715F1000. In addition, we are of the opinion that the proposed rate increases appear to be reasonable and in conformance with the Company's Chapter 30 Plan. Therefore, we shall approve Verizon PA's 2006 PCO calculation and proposed rate increases subject to findings of the Office of Administrative Law Judge (''ALJ'') regarding the complaints filed by OCA and OSBA and subject to refund.

2.  Banked Revenues

   As noted, the Company proposes to bank the remainder of the 2006 PCO increase consistent with the PCO banking methodology and timing that has been approved for Sprint/United. The approved Chapter 30 Plans for Sprint/United and other ILECs contain certain provisions for banking. We note that the OSBA does not object to the banking and the OCA did not object to the proposal to bank a portion of the increase. The OCA, however, did suggest that the Commission set restrictions on Verizon PA's use of the banked portions similar to restrictions that exist in other ILEC Chapter 30 plans. The OCA did not state whether the Sprint/United banking rules would be acceptable. We further note that in our Order entered October 11, 2005, at Docket Nos. P-00930715 and P-0001854, we directed Verizon PA to bank a portion of its 2003 PCO filing to be used to fund its required contribution to the Pa. USF. Here we placed a restriction on the use of the funds, similar to that which the OCA requested, without Verizon PA's Chapter 30 Plan containing any banking provisions. Finally, it is noted that if the banking is not permitted, the only alternatives available to Verizon PA are to (1) forego that portion of the PCO that they desire to bank or (2) increase rates by the full $16.7 million instead of the proposed $15.5 million. In our opinion, we cannot force Verizon PA to forego an increase to which it is entitled. As such, the only option available to Verizon PA would be to make the increases larger than proposed. However, we do not support giving Verizon PA, or any utility, an increase greater than that requested. Therefore, in order to ensure an equitable balance between Verizon PA's entitlement while avoiding further rate increases beyond what Verizon PA proposed in this filing, we shall approve Verizon PA's proposal to bank the $1.2 million remainder of its 2006 PCO increase consistent with the following banking methodology and timing that we previously approved for Sprint/United:3

   1.  After 2001, annual price decreases calculated under the PSI filed on September 1 of each year may be banked for application in future years, not to exceed four (4) consecutive years.4 Such banking of decreases will be with interest at a rate set forth in 66 Pa.C.S. § 1308.

   2.  The banked price changes must be implemented no more than four (4) years after the annual price change is applied.

   3.  If a decrease is greater than $500,000, the Company will implement the decrease immediately.

   This adoption of the Sprint/United banking methodology shall constitute an agreement between the Commission and Verizon PA pursuant to § 3013(b) of Act 183. We note the remaining banked value of the Company's 2003 PCO is a negative $512,140 inclusive of interest which, when netted against the remaining 2006 PCO banked increase of $1.2M results in a net banked increase of approximately $700,000. We make no determination at this time whether the recoveries of banked amounts are affected by a company's past or future competitive service declarations. However, we are mindful of Sections 3016(b) and (f) and encourage the Company to recover its banked revenue increases from the appropriate group of its non-competitive customers, consistent with applicable provisions of Chapter 30 (66 Pa.C.S. §§ 3001, et al.).

   The Company requests permission to continue in 2006 to use the on-going value of its 2003 PCO of negative $17.4M to support its payments to the Pa. USF and bank the difference. This request is made pursuant to the Commission's Order entered October 11, 2005, at Docket Nos. P-00930715 and P-00001854. In this Order, Verizon PA was directed to bank the difference each year between its available 2003 PCO monies and its required contribution to the Pa. USF and account for this in the annual PCO filings including interest on the banked amounts. These banked amounts are specific to the on-going value and use of the 2003 PCO and is a method of accounting for the difference, since the Pa. USF amount can vary from year to year. Verizon PA has complied with the October 11, 2005 Order. Therefore, in light of the discussion in the October 11, 2005 Order mentioned above, we shall permit Verizon PA to continue using its available 2003 PCO money to fund its required contributions to the Pa. USF and bank the difference utilizing the Sprint/United methodology.

   The Company also proposes to account for the two-month plus two-day delay in implementation of the 2006 PCO by using a portion of the banked value associated with the Company's 2003 PCO. In past years, the one-time financial value of Verizon PA's PCOs not fully implemented on January 1 has been accounted for in some manner (e.g., support for the Company's Lifeline program). We also note that by not accounting for the delay value in the manner proposed, Verizon PA could have recovered the 2006 PCO revenue increase over the remaining 10 months resulting in additional increases in end-user rates. In addition, the banked decrease from the 2003 PCO will be reduced. We believe this accounting for the delay value is reasonable and in the public interest. Therefore, we shall approve Verizon PA's proposal for the delay value of the 2006 PCO; Therefore,

It Is Ordered That:

   1.  Verizon Pennsylvania Inc's 2006 PCO filed on December 30, 2005, is in compliance with its Commission-approved Amended Chapter 30 Plan.

   2.  The tariffed rate increases proposed by Verizon Pennsylvania Inc. be permitted to go into effect as filed subject to findings of the Office of Administrative Law Judge regarding the complaints filed by the Office of Consumer Advocate and the Office of Small Business Advocate and subject to refund investigation and recoupment.

   3.  Verizon Pennsylvania Inc.'s proposal to bank the remainder of its 2006 PCO increase is approved.

   4.  The banking methodology and timing approved by the Commission for Sprint/United at Docket No. P-00981410F1000, Order entered June 23, 2005, be adopted by Verizon Pennsylvania Inc.

   5.  Verizon Pennsylvania Inc. be permitted to continue using its available 2003 PCO money to fund its required contributions to the Pennsylvania Universal Service Fund and bank the difference utilizing the Sprint/United methodology.

   6.  Verizon Pennsylvania Inc.'s proposal to account for the delay value of the 2006 PCO is approved.

   7.  The Commission Order in this matter be published in the Pennsylvania Bulletin.

   8.  A copy of this Order be served on the Office of Consumer Advocate, Office of Small Business Advocate, the Office of Trial Staff and the Office of Administrative Law Judge.

JAMES J. MCNULTY,   
Secretary

Statement of Vice Chairperson James H. Cawley

Public Meeting: March 2, 2006; MAR-2006-FUS-0426*

Verizon Pennsylvania Inc. 2006 Price Change Opportunity Filing; Doc. Nos: R-00051228 and P-00930715F1000

Office of Small Business Advocate v. Verizon Pennsylvania Inc.; Doc. No. R-00051228C0001

Office of Consumer Advocate v. Verizon Pennsylvania Inc.; Doc. No. R-00051228C0002

   Before us for disposition is the Staff recommendation regarding the Verizon Pennsylvania Inc. (''Verizon PA'' or ''Company'') 2006 Price Change Opportunity (''PCO'') filing that was made on December 30, 2005. This filing was submitted under the provisions of the new Chapter 30 law, Act 183 of 2004, P. L. 1398, 66 Pa.C.S. §§ 3011-3019 (''Act 183'' or ''new Ch. 30''), and the Company's Amended Alternative Regulation and Network Modernization Plan (''Amended NMP''), that this Commission approved at Docket No. P-00930715F1000.5

   Given my concerns with this filing, I reluctantly concur with allowing the proposed revenue and rate increases to go into effect subject to refund pending the adjudication of the formal complaints by the Office of Consumer Advocate (OCA) and the Office of Small Business Advocate (OSBA). The Legislature's deletion of Section 1308 from Section 3019(h) (quoted below) may preclude us from suspending and investigating these types of filings no matter how flawed they may be. The Commission can always act on the validity of a Ch. 30 PCO filing. However, in this case, where formal complaints have been filed against Verizon PA's 2006 PCO submission, the Commission can express its concerns, not prejudge the outcome of the case, and permit the related issues to be fully adjudicated in the context of the pending complaints.

   My concerns are that (1) the filing's rates may be unlawfully excessive and discriminatory; (2) the Company's 2003 ''banked'' negative revenues might more properly have been used to reduce the rate increases proposed by this 2006 filing; and (3) the Company appears to have no right to bank revenue increases it is now entitled to but voluntarily has chosen to forego by not modifying its Amended NMP to include a banking provision under a procedure now mandated by the new Chapter 30.

1.  The Statutory Preeminence of Amended NMP Safeguards and Possibly Excessive Rates.

   Verizon PA's PCO is governed by its post-Act 183 Ch. 30 Amended NMP which was formulated and approved by the Commission to include significant safeguards from the ''old'' Bell Atlantic Pa. pre-Act 183 Ch. 30 NMP. Indeed, unlike other ILECs who completely replaced their original NMPs with new ones, Verizon PA produced its Amended NMP through the simple additive introduction of supplements to its ''old'' pre-Act 183 Ch. 30 NMP. It would appear that those supplements did not supersede pre-existing safeguards governing the Company's revenue and rate changes that can be implemented through the PCO mechanism. The Company's post-Act 183 Ch. 30 Amended NMP still contains the following language that governs the implementation of PCO revenue and rate increases:

After the period of prohibited price increases described in Section B.2., Bell [Verizon PA] will apply the price stability formula described in Section A.2. to all protected services revenues to determine the Price Change Opportunity for protected services. If the Price Change Opportunity is positive, Bell may propose tariff rate changes to increase revenues for protected services by no more than the Price Change Opportunity for all protected services. In addition, for Residential Local Exchange Services and Business Local Exchange Services provided to small businesses with three (3) or fewer lines, revenue increases from tariff rate changes are limited to the lesser of (a)6
 . . . or (b) the overall average percentage increase in total noncompetitive service revenues proposed by Bell [Verizon PA] pursuant to the PSM [Price Stability Mechanism].

   Verizon PA Amended NMP, Part 1.B.3, p. 10 (emphasis added).

   This language may not have been superseded by the post-Act 183 amending supplement ''Part 5--Act 183 Supplement--Changes In the Non-NMP Sections of the Plan,'' and, thus, may constitute valid and currently applicable safeguards that still govern the proposed PCO revenue and rate increases of the Company.

   The Company is proposing an overall increase in its non-competitive services revenues of 2.16%. A simple mathematical calculation indicates that the proposed revenue increases for the non-competitive service categories of local exchange services for residential and single-line and multi-line business customers appear to be respectively 2.40% and 3.71% and, thus, higher than the overall proposed increase of 2.16%.7 These percentage increases appear to be contrary to the above-referenced Verizon NMP Amended NMP safeguard language which was originally put in place so that the non-competitive service categories involving residential and small business customers would not disproportionately absorb the allocations of the overall revenue increases arising from the Company's PCO mechanism.

   The statutory language at Section 3019(h) of the new Ch. 30 law elevates to preeminence the Amended NMPs of individual ILECs, especially on matters of rate making:

Implementation.--The terms of a local exchange telecommunications company's alternative form of regulation and network modernization plans shall govern the regulation of the local exchange telecommunications company and, consistent with the provisions of this chapter, shall supersede any conflicting provisions of this title or other laws of this Commonwealth and shall specifically supersede all provisions of Chapter 13 (relating to rates and rate making) other than sections 1301 (relating to rates to be just and reasonable), 1302 (relating to tariffs; filing and inspection), 1303 (relating to adherence to tariffs), 1304 (relating to discrimination in rates), 1305 (relating to advance payment of rates; interest on deposits), 1309 (relating to rates fixed on complaint; investigation of costs of production) and 1312 (relating to refunds).

   66 Pa.C.S. § 3019(h) (emphasis added).

   Thus, it appears that the various provisions and rate making safeguards contained in an ILEC's Ch. 30 Amended NMP are statutorily paramount and expressly govern price stability mechanism (PSM) revenue and rate increases such as those proposed by Verizon PA. Consequently, the safeguards in the individual ILEC Ch. 30 NMPs must be followed.

   Therefore, there appears to be no merit to the argument that Section 3015(a)(3) of the new Ch. 30 law, 66 Pa.C.S. § 3015(a)(3), provides sufficient safeguards for non-rural ILEC PSM revenue and rate increases.8 That subsection simply concerns the level of rate increases for residential ILEC customers that are affected by Ch. 30 PSM revenue and rate increases. The argument appears to ignore the preeminence of the ILEC Ch. 30 Amended NMP safeguards conferred by Section 3019(h). Furthermore, Section 3015(a)(3) does not provide any protections to small business customers. They must be protected by the safeguards in the Company's Amended NMP as provided by Section 3019(h). I sincerely doubt that the General Assembly in enacting Act 183 was concerned with the welfare of only a single class of ILEC non-competitive service customers.

   The Recommended Decision in the pending OCA and OSBA formal complaint proceedings should address these issues and provide appropriate recommendations to the Commission, including procedural alternatives if Verizon PA's PCO filing is found to be incompatible with the safeguards contained in its Amended NMP.

2.  Possible Rate Discrimination.

   Although the Commission apparently has no choice but to permit the proposed $15,535,600 PCO revenue and rate increase to go into effect as filed pending the resolution of the OCA and OSBA complaints, I am concerned that the rates may be discriminatory. Basic local exchange services of residential and small business customers will absorb the bulk of the proposed PCO revenue increase. It appears that the pending complaint proceedings will explore whether the PCO revenue in-crease could (or must) be lawfully allocated to other non-competitive service categories of the Company in accordance with its Ch. 30 Amended NMP and the statutory mandates of Act 183.

   Those complaint proceedings will also provide the legal and evidentiary basis for a future decision on whether the provision of rate discounts to certain categories of small business customers that sign-up for the Verizon PA 24-month Dial Tone Line Term Plan, where such customers still subscribe to non-competitive local exchange services of the Company, gives rise to unlawful rate discrimination. That Plan has already been filed with the Commission as a competitive services offering under the Company's informational Tariff 500.9

   My additional concern involves the relationship of the Company's PCO revenue and rate increase, the concept of ''protected services'' as these are defined under the new Ch. 30 law, 66 Pa.C.S. § 3012, and Verizon PA's flexible provision of ''bundled packages of services'' ''which include nontariffed, competitive, noncompetitive or protected services,'' and the ''services of an affiliate, in combinations and at a single price selected by the company.'' 66 Pa.C.S. § 3016(e)(2). Verizon PA provides such ''service bundles'' as ''competitive service'' offerings to both residential and business customers under its informational Tariff 500. It does not appear that Verizon PA has included any revenues from the ''protected'' local exchange service portions of such ''service bundles'' in its overall non-competitive service category revenues on which the overall PCO revenue and rate increase is calculated. Correspondingly, the Company's PCO filing does not provide sufficient information indicating whether the ''protected'' local exchange service portion of these ''service bundles'' is affected in any way by the proposed PCO-related local exchange service dial tone line rate increases. Verizon PA is implementing increases in dial tone line rates for ''competitive'' services that are provided to single-line and multi-line business customers under the Company's informational Tariff 500. Those rate increases ''mirror'' the corresponding PCO rate increases that affect the dial tone line rates for Verizon PA's ''non-competitive'' local exchange services to single-line and multi-line business customers.10

   The complaint proceedings should address the issue of whether there is unlawful rate discrimination if the ''non-competitive'' basic local exchange service residential and small business customers absorb PCO related revenue and rate increases, but such rate increases are not reflected in the corresponding ''protected services'' portion of residential and small business customers that subscribe to the Company's ''service bundles'' offered under its informational Tariff 500. More specifically, are ''protected services'' offered as parts of a ''service bundle'' somehow transformed into ''competitive'' services? If so, is such transformation compatible with the statutory mandate and classification of telecommunications services under Act 183? And should the ''protected service'' portion of ''service bundles'' be accounted in the Company's PCO mechanism in some fashion? These issues are important because they relate to basic telephone service consumer protections that are the subject of an ongoing proceeding.11

3.  Banking of 2003 PCO and Pennsylvania USF Obligation Funding

   In my concurring and dissenting statement in our disposition of the Verizon PA and Verizon North Inc. 2005 PCO filings, I predicted that under the new Ch. 30 law ''Verizon PA can seek and obtain a substantial revenue and rate increase for its non-competitive services when it submits its annual PCO filing for 2006,'' and that ''a much sounder approach'' would have been ''to apply the remaining and unused amount from the Company's 2003 PCO revenue decrease against the upcoming 2006 PCO revenue and rate increase that will impact the Company's non-competitive services end-user ratepayers.''12 That offset did not occur in this filing; the banked 2003 negative revenues are used for purposes other than reducing the revenue and rate impact of the 2006 PCO on the ratepayers of non-competitive services.13 I continue to question whether the 2003 revenues might more properly have been used to reduce the rate increases proposed by this 2006 filing.

4.  Banking of $1.2 Million of the 2006 PCO Revenue Increase

   It is my tentative conclusion that a PCO tariff filing is not the proper method to obtain amendments to an ILEC's Ch. 30 Amended NMP. Act 183 provides for the orderly process of filing a petition in order to obtain such amendments to an ILEC's Ch. 30 Amended NMP.14 Like many other ILECs, Verizon PA could have inserted a ''banking'' provision in its Amended NMP, or it could have petitioned for an appropriate modification to its Amended NMP. The Commission would have evaluated and ruled on such a petition within the statutorily prescribed 100-day time interval. 66 Pa.C.S. § 3014(e). Verizon PA did not choose to do either. Instead, it seeks a modification of its Amended NMP through its 2006 PCO tariff filing.

   Since Act 183 provides a specific method to modify Amended NMPs, it appears that the Commission may not entertain Verizon PA's request for such a modification in this PCO filing with its 60-day notice period rather than the 100-day notice period provided for revisions to Amended NMPs under 66 Pa.C.S. § 3014(e).15 I doubt that we may ignore the requirement of Section 3014(e) any more than we may ignore the Legislature's deletion of Section 1308 from Section 3019(h).

   Finally, it does not necessarily follow that the Company may alternatively collect the full amount of the revenues to which it is entitled in 2006 should the procedure in Section 3014(e) be found mandatory. The Company having voluntarily placed itself in a ''use it or lose it'' position, it may well be required to ''lose'' the amount it now wishes to bank.

[Pa.B. Doc. No. 06-594. Filed for public inspection April 7, 2006, 9:00 a.m.]

_______

1  Petition for Amended Alternative Regulation and Network Modernization Plan of Verizon Pennsylvania Inc., Docket No. P-00930715F1000 (Order entered May 20, 2005).

2  Petition for Amended Alternative Regulation and Network Modernization Plan of United Telephone Co., Docket No. P-00981410F1000 (Order entered June 23, 2005).

3  The reference to ''PSI filed on September 1 of each year'' in the Sprint/United banking methodology should be modified to read ''PCO filed on November 1 of each year'' for Verizon PA.

4  For annual price increases, the Company may apply them in future years, without limitation as to time.

5  Petition for Amended Alternative Regulation and Network Modernization Plan of Verizon Pennsylvania Inc., Docket No. P-00930715F1000, Order entered May 20, 2005.

6  This part is no longer applicable since it refers to the old and superseded formula (GDP-PI minus the 2.93 146432nflation offset).

7  The results of these calculations do not breach the confidentiality protection accorded to the underlying data that Verizon PA has classified as proprietary.

8  See generally Verizon PA Motion to Dismiss Complaint of the Office of Small Business Advocate, Docket No. R-00051228C0001, filed January 26, 2006, at 3-4; and Verizon PA Motion to Dismiss Complaint of the Office of Consumer Advocate, Docket No. R-00051228C0002, filed January 26, 2006, at 7-8.

9  Verizon PA, Business 24-Month Dial Tone Line Term Plan, Docket No. R-00061347, Pa. P.U.C. Tariff 500, Sec. 47, Orig. Sheets 1 & 2, filed February 28, 2006, effective March 3, 2006. See also Verizon PA Revised Executive Summary, 2006 PCO Filing, Docket No. R-00051228, filed January 13, 2006, p. 1; and OCA Formal Complaint, Docket No. R-00051228C0002, filed January 10, 2006, ¶ 4.C, at 2.

10  Verizon PA, 2006 PCO Filing, Docket No. R-00051228, Pa. P.U.C. Tariff No. 500, Sec. 36.C.1.c, Sec. 37.D.2, Sec. 38.D.3, Sec. 39.D.2, and Sec. 40.D.3.

11  Petition of Trinsic Communications, Inc. f/k/a Z-tel Communications, Inc. for Waiver of Certain Billing and Collection Rule Requirements Set Forth at 52 Pa. Code Chapter 64 to Permit Provision of Singly-Priced Service Packages to Customers, Docket No. P-00052169, Order entered February 1, 2006.

12  Verizon Pennsylvania Inc. 2005 Price Change Opportunity Filing, Verizon North Inc. 2005 Price Change Opportunity Filing, Docket Nos. P-00930715 and P-00001854, Order entered October 11, 2005, Statement of Vice Chairman James H. Cawley Concurring in Part and Dissenting in Part.

13  The banked 2003 PCO negative revenues will also be used to offset the revenue effects arising from Verizon PA's two-month plus two-day delay in implementing its 2006 PCO rate changes. This issue is one of the subject areas of OCA's formal complaint at Docket No. R-00051228C0002.

14  See generally Petition for revision to the Amended Alternative Regulation and Network Modernization Plan of Commonwealth Telephone Company, Docket No. P-00961024F1000, Order entered February 10, 2006; and 66 Pa.C.S. § 3013(b).

15  Nor should the Commission prejudge the propriety of this attempted shortcut. It is an issue included within OCA's complaint. Answer of the Office of the Consumer Advocate to the Verizon Pennsylvania, Inc. Motion to Dismiss, Docket No. R-00051228C0002, at 13-17, and Appendix B.



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