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If you need the complete document, download the WordPerfect version or Adobe Acrobat version, if available. ***************************************************************** Before the Federal Communications Commission Washington, D.C. 20554 ) In the Matter of ) ) Southwestern Bell Telephone Company ) Petitions for Limited Modification of LATA ) Boundaries to Provide Expanded Local ) File No. NSD-LM-97-32 Calling Service (ELCS) at Various Locations ) MEMORANDUM OPINION AND ORDER Adopted: December 3, 1997 Released: December 3, 1997 By the Chief, Common Carrier Bureau I. INTRODUCTION 1. On September 29, 1997, Southwestern Bell Telephone Company (SWBT), pursuant to Section 3(25) of the Communications Act of 1934, as amended, filed 64 petitions to provide two- way, non-optional, expanded local calling service (ELCS) between various exchanges in Texas. Each of SWBT's petitions requests a limited modification of local access transport area (LATA) boundaries. The petitions were placed on public notice and no comments or replies were filed. For the reasons stated below, we grant SWBT's 64 ELCS requests. II. BACKGROUND 2. Requests for new ELCS routes are generally initiated by local subscribers. IntraLATA ELCS routes can be ordered by the state commission. For interLATA routes, prior to the Telecommunications Act of 1996 (1996 Act), the BOCs were required to secure state approval and then obtain a waiver from the United States District Court for the District of Columbia (District Court). In the years between the Consent Decree and the 1996 Act, the District Court received more than a hundred requests for Consent Decree waivers to permit new interLATA ELCS routes. Because of the large number of requests involved and because most of the requests were non- controversial, the District Court developed a streamlined process for handling such requests. 3. Under the streamlined process developed by the District Court, the BOC submitted its waiver request to the Department of Justice (Department). The Department reviewed the request and then submitted the request, along with the Department's recommendation, to the District Court. In evaluating ELCS requests, the Department and the District Court considered the number of customers or access lines involved as well as whether a sufficiently strong community of interest between the exchanges justified granting a waiver of the Consent Decree. A community of interest could be demonstrated by such evidence as: (1) poll results showing that customers in the affected exchange were willing to pay higher rates to be included in an expanded local calling area; (2) usage data demonstrating a high level of calling between the exchanges; and (3) narrative statements describing how the two exchanges were part of one community and how the lack of local calling between the exchanges caused problems for community residents. In addition, the Department and the District Court gave deference to the state's community of interest finding. The District Court also considered the competitive effects of granting a proposed ELCS waiver. 4. Matters previously subject to the Consent Decree are now governed by the Act. Under section 3(25)(B) of the Act, BOCs may modify LATA boundaries, if such modifications are approved by the Commission. On July 15, 1997, the Commission released a decision granting 23 requests for limited boundary modification to permit ELCS. Although calls between the ELCS exchanges would now be treated as intraLATA, each ELCS exchange would remain assigned to the same LATA for purposes of classifying all other calls. The Commission stated that it would grant requests for such limited modifications only where a petitioning BOC showed that the ELCS was a flat-rated, non-optional service, a significant community of interest existed among the affected exchanges, and grant of the requested waiver would not have any anticompetitive effects. The Commission stated further that a carrier would be deemed to have made a prima facie case supporting grant of the proposed modification if the ELCS petition: (1) has been approved by the state commission; (2) proposes only traditional local service (i.e., flat-rated, non-optional ELCS); (3) indicates that the state commission found a sufficient community of interest to warrant such service; (4) documents this community of interest through such evidence as poll results, usage data, and descriptions of the communities involved; and (5) involves a limited number of customers or access lines. III. DISCUSSION 5. Each of SWBT's 64 ELCS petitions proposes to establish a flat-rated, two-way, non- optional ELCS. Each request is accompanied by: (1) an order confirming state approval of the limited LATA modification requested; (2) a statement that only traditional local service is proposed; (3) a community of interest finding by the Public Utility Commission of Texas; (4) the results from subscriber polls documenting a community of interest; and (5) a statement of the number of access lines involved. The petitions do not provide usage data in the form of an average number of calls per access line per month between the respective exchanges, nor the percentage of subscribers making such calls. The brief descriptions of the basis for the requested ELCS reveal that many community services (such as hospitals, doctors offices, schools, stores, public transportation facilities, and government offices) are located in a nearby community in the adjacent LATA, and that making interLATA toll calls for such services generates significant expenses for residents. 6. As we stated in the July 1997 Order, granting an ELCS petition removes the proposed route from the competitive interexchange market. Some LATA modifications could reduce the incentive created by Section 271 of the Act for BOCs to open their local exchange and exchange access markets to competition. Given, however, the small number of access lines involved in each of the proposed ELCS areas in these petitions, as well as the type of service to be offered (i.e., flat- rated, non-optional local service), we find that the proposed LATA modifications will not have a significant anticompetitive effect on the interexchange market or on SWBT's incentive to open its local exchange and exchange access markets to competition. IV. CONCLUSION 7. We conclude that, in each of the 64 requests, the community's need for the proposed ELCS routes outweighs the risk of potential anticompetitive effects. Granting SWBT's petitions serves the public interest by permitting minor LATA modifications in cases where such modifications are necessary to meet the needs of local subscribers and will not have any significant effect on competition. Accordingly, we approve SWBT's 64 petitions for limited LATA modifications in order to provide flat-rated, non-optional ELCS. These LATAs are modified solely for the limited purpose of allowing SWBT to provide flat-rated, non-optional local calling service between the specific exchanges or geographic areas identified in the requests. In each case, the LATA is not modified to permit the BOC to offer any other type of service, including calls that originate or terminate outside the specified areas. Thus, flat-rated, non-optional ELCS between the specified exchanges will be treated as intraLATA, and the provisions of the Act governing intraLATA service will apply. Other types of service between the specified exchanges will remain interLATA, and the provisions of the Act governing interLATA service will apply. V. ORDERING CLAUSES 8. Accordingly, IT IS ORDERED that, pursuant to Sections 3(25) and 4(i) of the Communications Act of 1934, as amended, 47 U.S.C.  153(25), 154(i), and 47 C.F.R.  0.91 and 0.291 of the Commission's rules, that the requests of Southwestern Bell Telephone Company for LATA modifications for the limited purpose of providing flat-rated, non-optional ELCS at specific locations, identified in File No. NSD-LM-97-32, ARE APPROVED to the extent described above. 9. IT IS FURTHER ORDERED that, pursuant to section 416(a) of the Act, 47 U.S.C.  416(a), the Secretary SHALL SERVE a copy of this order upon the petitioner, Southwestern Bell Telephone Company. FEDERAL COMMUNICATIONS COMMISSION A. Richard Metzger, Jr. Chief, Common Carrier Bureau APPENDIX A List of Petitions and LATA Modification Requests The following chart shows, for each petition, the number of access lines involved and the percentage of consumers returning ballots in favor of ELCS. PETITION ACCESS LINES CONSUMER SUPPORT Alba of Contel/ Mineola of SWBT. Alba 1,231 Mineola 5,385 Alba 81.7% Annona of Contel-GTE Southwest,Inc./Paris of SWBT. Annona 332 Paris 22,541 Annona 87.8 % Bellvue of SWBT/ Decatur of Sprint- United-Centel Telephone. Bellvue 465 Decatur 5,691 Bellvue 77.69% Ben Wheeler of Contel -GTE Southwest, Inc./ Tyler of SWBT. Ben Wheeler 736 Tyler 76,784 Ben Wheeler 70% Blessing of Contel-GTE Southwest, Inc./ Bay City of SWBT. Blessing 1,073 Bay City 13,678 Blessing 81% Bogata of Contel-GTE Southwest, Inc./Mount Pleasant of SWBT. Bogata 1,549 Mount Pleasant 1,194 Bogata 88.5 % Bowie of SWBT/Decatur of Sprint- United-Contel and Sunset of S-U-C. Bowie 5,060 Decatur 5,691 Sunset 375 Bowie 72.76 % Decatur 70.48 % Bremond of Sprint-United- Centel/Calvert and Hearne of SWBT. Bremond 973 Calvert 836 Hearne 4,021 Bremond 88.17% Calvert 89.58% Bronte of Contel-GTE Southwest,Inc./ Abilene of SWBT. Bronte 685 Abilene 69,688 Bronte 95.18% Canton of Contel-GTE Southwest,Inc./Tyler of SWBT. Canton 4,020 Tyler 76,784 Canton 70% Chester of Eastex Telephone Co./ Woodville of SWBT. Chester 419 Woodville 4,506 Chester 86.2% Chico of Sprint -United-Centel Telephone/Bowie of SWBT. Chico 1,425 Bowie 5,060 Chico 70% Clarksville of Contel -GTE Southwest,Inc./ Paris of SWBT. Clarksville 2,954 Paris 22,541 Clarksville 77.3% Cross Plains of Contel-GTE Southwest,Inc./ Abilene of SWBT. Cross Plains 1,264 Abilene 69,688 Cross Plains 84.60% Dawson of Contel-GTE Southwest,Inc./ Corsicana of SWBT. Dawson 822 Corsicana 15,433 Dawson 87.7% Dodson of Contel-GTE Southwest,Inc./ Childress of SWBT. Dodson 93 Childress 7,391 Dodson 76.74% Edom-Brownsboro of Sprint-United- Centel Telephone/Mineola, Lindale- Swan, Tyler, and Owentown of SWBT. Edom-Brownsboro 2,776 Mineola 5,385 Lindale-Swan 7,315 Tyler 76,784 Owentown 2,100 Edom-Brownsboro to Mineola 85% to Lindale-Swan 87.9% to Tyler 97.6% to Owentown 84.3% Flat of Sprint-United-Centel/Belton and Temple of SWBT. Flat 179 Belton 10,722 Temple 34,589 Flat to Belton 75.41% to Temple 84.62% Forestburg of Muenster Telephone/Bowie of SWBT. Forestburg 400 Bowie 5,060 Forestburg 82.40% Frankston of Sprint-United-Centel Telephone/Tyler of SWBT. Frankston 3,033 Tyler 76,784 Frankston 90% Frentress of Contel-GTE Southwest/Luling of SWBT. Frentress 438 Luling 3,262 Frentress 90% Frost of Contel-GTE Southwest, Inc./ Hillsboro of SWBT. Frost 414 Hillsboro 6,094 Frost 70% Gatesville of Sprint-United-Central Telephone/Temple of SWBT. Gatesville 6,110 Temple 34,589 Gatesville 83.94% Grand Saline of Contel-GTE Southwest,Inc./Tyler of SWBT. Grand Saline 2,413 Tyler 76,784 Grand Saline 81.4% Hamlin of SWBT/ Aspermont, Rule, and Haskell of Contel-GTE Southwest,Inc. Hamlin 1,447 Aspermont 837 Rule 502 Haskell 2,193 Hamlin to Aspermont 84.9% to Rule 80.4% to Haskell 82.9% Hankamer of ALLTEL/ Dayton and Liberty of SWBT. Hankamer 405 Dayton 6,969 Liberty 6,348 Hankamer to Dayton 95.67% to Liberty 96.91% Haskell of Contel-GTE Southwest, Inc./ Abilene of SWBT. Haskell 2,193 Abilene 69,688 Haskell 90.64% Hubbard of Contel-GTE Southwest,Inc./ Corsicana of SWBT. Hubbard 1,001 Corsicana 15,433 Hubbard 75.7% Irene of Contel-GTE Southwest,Inc./ Corsicana of SWBT. Irene 373 Corsican 15,433 Irene 70% Itasca of SWBT/ Cleburne of SWBT, Covington and Grandview of Texas ALLTEL. Itasca 901 Cleburne 23, 196 Covington 572 Grandview 1,417 Itasca to Cleburne 77.42% to Covington 73.94% to Grandview 75.68% Jarrell of Contel-GTE Southwest,Inc./ Bartlett of SWBT. Jarrell 785 Bartlett 1,180 Jarrell 86% Jarrell of Contel-GTE Southwest, Inc./ Belton and Temple of SWBT. Jarrell 785 Belton 10,722 Temple 34,589 Jarrell to Belton 70% to Temple 70% Kopperl of Texas ALLTEL/Meridian of SWBT. Kopperl 340 Meridian 1,198 Kopperl 70% Lakeside Village of Alltel/Meridian of SWBT. Lakeside Village 347 Meridian 1,198 Lakeside Village 84.56% Leona of Contel-GTE Southwest, Inc./ Huntsville and Madisonville of SWBT. Leona 445 Huntsville 21,892 Madisonville 4,209 Leona to Huntsville 80.7% to Madisonville 87.3% Madisonville of SWBT/Bryan-College Station of Contel-GTE Southwest,Inc. Madisonville 4,209 Bryan-College Station 32,050 Madisonville 70% Milford of Contel-GTE Southwest,Inc./ Hillsboro of SWBT. Milford 388 Hillsboro 6,094 Milford 84.20% Mineola of SWBT/Grand Saline of Contel-GTE Southwest, Inc. Mineola 5,385 Grand Saline 2,413 Mineola 79% Montalba of Sprint-United-Centel Telephone/Tyler of SWBT. Montalba 1,212 Tyler 76,784 Montalba 81.2% Moran of Contel-GTE Southwest, Inc./ Breckenridge and Cisco of SWBT. Moran 247 Breckenridge 5,238 Cisco 2,568 Moran to Breckenridge 74.14% to Cisco 70.59% Morgan of Contel-GTE Southwest, Inc./ Meridian of SWBT. Morgan 287 Meridian 1,198 Morgan 76.70% Mount Vernon of Contel-GTE Southwest, Inc./Paris of SWBT. Mount Vernon 2,048 Paris 22,541 Mount Vernon 71.41% Murchison of Sprint-United-Centel Telephone/Lindale-Swan and Tyler of SWBT. Murchison 1,216 Lindale-Swan 7,315 Tyler 76,784 Murchison to Lindale-Swan 72.9% to Tyler 90.5% Neches of Sprint-United-Central Telephone/Tyler of SWBT. Neches 539 Tyler 76,784 Neches 83.56% Nordheim of SWBT/Kennedy of SWBT. Nordheim 366 Kennedy 2,376 Nordheim 70% Oakland of Contel-GTE Southwest,Inc./Tyler of SWBT. Oakland 578 Tyler 76,784 Oakland 70% Pineland of Contel-GTE Southwest, Inc./Nacogdoches and San Augustine of SWBT. Pineland 1,461 Nacogdoches 27, 171 San Augustine 3, 715 Pineland to Nacogdoches 71.69% to San Augustine 73.33% Pettus of Sprint-United-Centel Telephone/Karnes City-Falls City and Kenedy of SWBT. Pettus 693 Karnes City-Falls City 2,542 Kenedy 2,376 Pettus to Karnes City -Falls City 87.20% to Kenedy 89.9% Putnam of Contel-GTE Southwest,Inc./Cisco of SWBT. Putnam 111 Cisco 2,568 Putnam 93% Reklaw of Contel-GTE Southwest, Inc./Tyler of SWBT. Reklaw 189 Tyler 76,784 Reklaw 87.85% Richland of Contel-GTE Southwest, Inc./Wortham and Mexia of SWBT. Richland 210 Wortham 647 Mexia 5,194 Richland to Wortham 96% to Mexia 98% Seagraves of Contel-GTE Southwest, Inc./Seminole of SWBT. Seagraves 1,009 Seminole 4,537 Seagraves 84.48% Sterling City of Contel-GTE Southwest,Inc./Big Spring and Colorado City of SWBT. Sterling City 768 Big Spring 14,851 Colorado City 3,460 Sterling to Big Spring 88.92% to Colorado City 83.09% Streetman of Contel-GTE Southwest,Inc./ Wortham and Mexia of SWBT. Streetman 709 Wortham 647 Mexia 5,194 Streetman to Wortham 70% to Mexia 70% Sunset of Sprint-United-Centel Telephone/Bowie of SWBT. Sunset 375 Bowie 5,060 Sunset 87.8% Teague of SWBT/Fairfield of Contel- GTE SWBT,Inc. Teague 2,280 Fairfield 4,427 Teague 70% Tenaha of Contel/GTE Southwest,Inc./ Carthage of SWBT. Tenaha 1,056 Carthage 7,720 Tenaha 85.07% Troup of Sprint-United-Centel Telephone/Tyler of SWBT. Troup 2,284 Tyler 76, 784 Troup 83.20% Tulia of Contel-GTE Southwest,Inc./ Amarillo and Canyon of SWBT. Tula 2,495 Amarillo 114,035 Canyon 7,717 Tulia to Amarillo 81.34% to Canyon 76.58% Wallisville of ALLTEL/Dayton and Liberty of SWBT. Wallisville 349 Dayton 6,969 Liberty 6,348 Wallisville to Dayton 95.77% to Liberty 96.3% Walnut Springs of Contel-GTE Southwest,Inc./ Meridian of SWBT. Walnut Springs 513 Meridian 1,198 Walnut 86.45% Weimar of Contel-GTE Southwest,Inc./ Columbus of SWBT. Weimar 1,461 Columbus 4,620 Weimar 73.43% Wortham of SWBT/Fairfield and Streetman of Contel-Southwest,Inc. Wortham 647 Fairfield 4,427 Streetman 709 Wortham to Fairfield 84.21% to Streetman 79.87% Yorktown of SWBT/Kenedy and Runge of SWBT. Yorktown 2,045 Kenedy 2,376 Runge 571 Yorktown to Kenedy 70% to Runge 70%