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                           Before the
                      Federal Communications Commission
                          Washington, D.C. 20554


                                   )
In the Matter of                        )
                                   )
Southwestern Bell                       )
Petition for Limited Modification of LATA         )         
Boundary to Provide Expanded Local                )         File No. NSD-L-01-30 
Calling Service (ELCS)                  )              

                              MEMORANDUM OPINION AND ORDER

Adopted: November 2, 2001                 Released: November 2, 2001

By the Acting Chief, Network Services Division, Common Carrier Bureau: 


                         I.  INTRODUCTION
                    
     1.  On January 30, 2001, Southwestern Bell Telephone Company (SWBT), pursuant to
Section 3(25) of the Communications Act of 1934, as amended, filed a petition to provide two-way,
flat-rated, non-optional expanded local calling service (ELCS) from the Hilltop Lakes exchange to
the Jewett exchange, both of which are located in Texas.  SWBT's petition requests a limited
modification of a local access and transport area (LATA) boundary.  The petition was placed on
public notice, and no comments were filed.  For the reasons stated below, we grant SWBT's
request.

                       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 Bell Operating Companies (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 one 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.  The petition is accompanied by: (1) a statement that only two-way, flat-rated, non-
optional ELCS is proposed; (2) an order issued by the Public Utility Commission of Texas
indicating that it found a sufficient community of interest between the respective exchanges; (3) a
statement of the number of access lines involved; (4) poll results; (5) a statement that no rate
increases will result for SWBT customers; and (6) a statement of the average number of calls per
access line per month between the respective exchanges.  The brief description of the community
of interest reveals that several businesses in the Jewett exchange employ and serve residents of
Hilltop Lakes.
 
     6.  We believe that the small number of access lines, the small volume of traffic involved for
the proposed ELCS area in this petition, and the fact that the service is flat-rated and non-optional
make it highly unlikely that provision of ELCS service would reduce SWBT's motivation to open
its own market to competition.  We conclude, therefore, that the information in the petition satisfies
the criteria established in the July 1997 Order.  Accordingly, the Division finds that the proposed
LATA modification will not have a significant anticompetitive effect on the interexchange market. 

     7.  Granting SWBT's petition serves the public interest by permitting a minor LATA
modification where such modification is necessary to meet the needs of local subscribers and will
not have any significant effect on competition.  Accordingly, we approve SWBT's petition for a
limited LATA modification to provide two-way, flat-rated, non-optional ELCS.  The LATA is
modified solely for the limited purpose of allowing SWBT to provide local calling service between
the specific exchanges or geographic areas identified in the requests.  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, the 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.






                    IV.  CONCLUSION AND ORDERING CLAUSES

8. Accordingly, IT IS ORDERED, 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 authority delegated by
Sections 0.91 and 0.291 of the Commission's rules, 47 C.F.R.  0.91, 0.291, that the request of
Southwestern Bell Telephone Company for a LATA modification for the limited purpose of
providing two-way, flat-rated, non-optional ELCS at the specific location, identified in File No.
NSD-L-01-30, IS APPROVED.  The LATA boundary is modified solely for the purpose of
providing ELCS between the points in the specific exchanges or geographic areas indicated in the
request.  The LATA boundary for all other services shall remain unchanged.

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



                         Diane Griffin Harmon
                         Acting Chief, Network Services Division 
                         Common Carrier Bureau