********************************************************    
                         NOTICE
********************************************************

This document was converted from
WordPerfect to ASCII Text format.

Content from the original version of the document such as
headers, footers, footnotes, endnotes, graphics, and page numbers
will not show up in this text version.

All text attributes such as bold, italic, underlining, etc. from the
original document will not show up in this text version.

Features of the original document layout such as
columns, tables, line and letter spacing, pagination, and margins
will not be preserved in the text version.

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                )
                                )  CC Docket No. 98-238
Beehive Telephone Company, Inc. )
Beehive Telephone, Inc. Nevada  )
                                )  Transmittal No. 14
Tariff F.C.C. No. 1             )
                                 
                              ORDER

     Adopted:  December 22, 1998             Released:  December 22, 1998 

By the Chief, Common Carrier Bureau

                         I.  INTRODUCTION

     1.   On December 8, 1998, Beehive Telephone Company, Inc. and Beehive Telephone, Inc.,
Nevada (collectively "Beehive") filed Transmittal No. 14, which proposes to increase its local switching
rate above the levels prescribed in the Beehive Tariff Investigation Order, Transmittal No. 8, and delete
Beehive's non-premium local switching rates.  On December 15, AT&T Corp. (AT&T) filed a Petition to
Reject or, in the Alternative, Suspend and Investigate Beehive's Transmittal No. 14.  Beehive filed a Reply
to AT&T's Petition on December 21, 1998.  For the reasons set forth below, we hereby reject Transmittal
No. 14 to the extent that it proposes to increase Beehive's local switching rate in violation of the
Commission's prescription in the Beehive Tariff Investigation Order, Transmittal No. 8.

                          II. BACKGROUND

     2.   On December 17, 1997, Beehive filed Transmittal No. 8, which, inter alia, proposed 
revised rates for premium and non-premium local switching.  The Commission investigated that tariff
filing, and concluded on June 1, 1998, that Beehive had failed to justify its revised rates as required under
the Commission's rules.  The Commission therefore prescribed rates for these services based on the
industry averages for comparably sized smaller LECs.   On September 28, 1998, the Commission
summarily rejected Beehive's petition for reconsideration of Beehive Tariff Investigation Order,
Transmittal No. 8.  

     3.   On June 16, 1998, Beehive filed Transmittal No. 11, which proposed to increase premium
and non-premium local switching rates above the levels prescribed in Beehive Tariff Investigation Order,
Transmittal No. 8.  The Bureau rejected Beehive's proposed local switching rates, and suspended and
designated for investigation proposed rates for tandem switched transport facility, tandem switched
transport termination, and transport interconnection charge (TIC).

     4.   On December 1, 1998, the Commission released a Memorandum Opinion and Order
concluding its investigation of Transmittal No. 11.  The Commission found that Beehive had failed to meet
its burden of proof under Section 204(a)(1) of the Communications Act of 1934, as amended (the Act), 47
U.S.C.  204(a)(1), to justify its proposed tandem switched transport facility, tandem switched transport
termination, and TIC rates.  It further found that it was unable to rely on supporting information submitted
by Beehive for the purpose of prescribing rates.  The Commission therefore prescribed rates for these
transport services based on NECA's rates for these services, and directed Beehive to refund to its
customers, with interest, the difference between NECA's rates and the rates filed by Beehive in June, 1998.

                         III.  DISCUSSION

     5.   We reject as patently unlawful Beehive's revised local switching rates because these rate
revisions contained in Transmittal No. 14 violate the Commission's rate prescription in the Beehive Tariff
Investigation Order, Transmittal No. 8.  Beehive contends that its filing is meant to allow its rates to be
"consistent with NECA's rates, and to comply with the Commission's Order requiring Beehive to use the
premium access rates set forth by NECA."  The Commission's Order concluding its investigation of
Beehive's Transmittal No. 11 did not in any way permit or require Beehive to change the local switching
rates previously prescribed for Beehive, nor did it require Beehive to delete its non-premium local switching
rates.  Beehive's contention that these elements of Transmittal No. 14 were filed in order to comply with the
Beehive Investigation Order is without basis.

     6.   It is well established that agencies are empowered to reject tariff filings that do not adhere
to prescriptions of rates or practices affecting rates.  In United Air Lines v. CAB, the U.S. Court of
Appeals for the Seventh Circuit upheld a decision of the Civil Aeronautics Board (CAB) to reject a tariff
that proposed higher rates than had been previously prescribed by the CAB.  In this case, following a
tariff investigation, the CAB prescribed certain fare levels for airline routes between Hawaii and the
mainland.  Five days after filing conforming tariffs, United Airlines filed new tariffs reflecting higher
fares than those prescribed by the CAB.  The CAB rejected the tariff filing, concluding that it has the
power to issue an order fixing rates for the future and to reject tariffs that are inconsistent with any rate
prescriptions.  The Seventh Circuit affirmed the CAB and stated, "[w]e believe that Congress no more
intended in the Federal Aviation Act than in the other three similar acts [the Interstate Commerce Act, the
Packers, and Stockyards Act, and the Natural Gas Act] to authorize the Board to establish a lawful rate
only to be followed immediately by the necessity of passing upon other and different rates filed by the
carriers."  If we were not permitted to reject tariffs that are inconsistent with rates prescribed by the
Commission, we "would be unable to prevent a continual merry-go-round of investigations all dealing with
the same subject."

     7.   We note that Beehive is required under Section 69.3(f) of the Commission's Rules to file a
complete revised access tariff effective July, 1 of each odd numbered year.  Beehive will thus have the
opportunity to file new local switching rates on June 16, 1999.

                      IV.  ORDERING CLAUSES

     8.   Accordingly, IT IS ORDERED, pursuant to Sections 201(b) and 205(a) of the
Communications Act of 1934, 47 U.S.C.  201(b), 205(a), and authority delegated pursuant to sections
0.91 and 0.291 of the Commission's rules, 47 C.F.R.  0.91, 0.291, the revisions pertaining to local
switching services filed by Beehive Telephone Company, Inc. and Beehive Telephone, Inc. of Nevada in
Transmittal No. 14 ARE REJECTED.

     9.   IT IS FURTHER ORDERED that Beehive Telephone Company, Inc. and Beehive
Telephone, Inc. of Nevada SHALL file tariff revisions removing the rejected material no later than five
business days from the release date of this Order.  For this purpose, Sections 61.58 and 61.59 of the
Commission's rules, 47 C.F.R.  61.58, 61.59, are waived.  Beehive Telephone Company, Inc. and
Beehive Telephone, Inc. of Nevada should cite the "DA" number of the instant Order as the authority for
this filing.  


                              FEDERAL COMMUNICATIONS COMMISSION




                              Lawrence E. Strickling
                              Chief, Common Carrier Bureau