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1. This Consent Decree is entered into by the Enforcement
Bureau of the Federal Communications Commission ("Bureau") and
Wisconsin Energy Corporation (``WEC'').
2. WEC is a Milwaukee-based holding company with subsidiaries
in utility and non-utility businesses. The company serves more
than one million electric and 921,000 natural gas customers in
Wisconsin and Michigan's Upper Peninsula through its utility
subsidiaries - Wisconsin Electric Power Company ("WEPCO"),
Wisconsin Gas Company ("WGC") and Edison Sault Electric Company
("ESELCO"). In connection with its public utility activities,
WEC maintains vital communications systems utilizing licenses
issued by the Commission. Its non-utility subsidiaries include
energy services and development, pump manufacturing, waste-to-
energy and real estate businesses. WEC reported annual revenues
of $2,272,000,000 for the fiscal year ending December 31, 1999.
3. In March 2000, WEC's counsel informed the Enforcement
Bureau's Investigations & Hearings Division that the company had
discovered a number of instances in which it acquired control of
radio facilities through a succession of mergers and corporate
reorganizations without prior Commission consent. WEC's counsel
indicated that the company was conducting an internal review to
determine the scope of the problem. Thereafter, on June 9, 2000,
WEC submitted an analysis of the results of its internal review.
WEC submitted a superseding analysis on July 11, 2000, and
supplemental information on November 7, 2000.
4. In its collective filings, WEC revealed the following:
Wisconsin Energy Corporation. Through 1986,
Wisconsin Natural Gas Company (``WNG'') and WEC were
wholly-owned subsidiaries of WEPCO. Effective January
1, 1987, the companies effectuated a corporate
reorganization whereby WEC became the holding company
of, and acquired all outstanding shares of stock in,
WEPCO and WNG. At the time of the transaction, WEPCO
was the licensee of 19 land mobile stations. Although
the corporate restructuring resulted in a pro forma
transfer of control of WEPCO's authorizations to WEC,
WEC did not request Commission consent to transfer
control of WEPCO's licenses to WEC until May 23, 2000,
more than 13 years after the fact. The Commission
granted its consent on June 13, 2000.
Wisconsin Electric Power Company. In April of
1994, two Multiple Address System (MAS) microwave
licenses held by WEPCO expired. Although Section 301 of
the Communications Act of 1934, as amended, prohibits
unlicensed operation, WEPCO continued to operate the
stations without seeking new or renewed licensing.
Applications to re-license the stations were filed on
September 13, 2000, and granted on December 5, 2000.
On November 14, 2000, WEPCO requested Special Temporary
Authority (``STA'') to operate the facilities. The
STAs were granted on November 17, 2000. In addition, in
1992, WEPCO relocated a facility for one point-to-point
microwave station without Commission authorization.
WEPCO has continued to operate the facility from the
unlicensed location since that time. On November 7,
2000, WEPCO requested an STA to operate the point-to-
point microwave facility at the new location and filed
an application to modify its license accordingly. The
STA was granted on November 20, 2000.
Wisconsin Natural Gas Company. Effective January
1, 1996, WNG (a wholly-owned subsidiary of WEC) merged
into WEPCO (also a wholly-owned subsidiary of WEC) and
ceased to exist. Although this corporate
reorganization resulted in the pro forma transfer of
control of 20 stations (seven land mobile and 13
microwave) from WNG to WEPCO, the companies did not
request Commission consent to the transfer of control
of the stations.
Six of the land mobile licenses held by WNG
expired on October 17, 1999 and the seventh land mobile
license expired on February 25, 2000. WEPCO, into which
WNG had merged, continued to operate the stations
without authority. On April 19, 2000, WEPCO obtained
an STA to operate the land mobile stations. It also
filed applications to re-license them. All of the
applications were granted in September 2000. In
addition, the license for one microwave station held by
WNG expired on December 23, 1998. WEPCO continued to
operate this station until approximately June 12, 2000,
when it discontinued operation. On May 19, 2000, WEPCO
filed an application for Commission consent to the
assignment of the 12 unexpired microwave licenses. All
were granted on May 31, 2000.
Wisconsin Southern Gas Company. Effective January
1, 1994, Wisconsin Southern Gas Company, an unrelated
utility, merged into WNG and ceased to exist. As a
consequence, WNG acquired control over one land mobile
station licensed to Wisconsin Southern Gas Company.
Although this transaction resulted in the substantial
transfer of control of the station to WNG, WEC did not
request Commission consent to the assignment of license
for the station until May 19, 2000, more than six years
later. The Commission granted its consent on June 9,
Edison Sault Electric Company. On May 31, 1998,
ESELCO, an unrelated utility holding company, merged
into WEC and ceased to exist. As a consequence, WEC
acquired control of three land mobile stations licensed
to ESELCO's wholly-owned subsidiary, Edison Sault
Electric Company, now a wholly-owned subsidiary of WEC.
Although the transaction resulted in the substantial
transfer of control of the three stations to WEC, WEC
did not request Commission consent to the assignment of
licenses for the stations until May 23, 2000, nearly
two years later. The Commission granted its consent on
June 12, 2000.
Presque Isle Power Plant. On or about December
31, 1987, WEPCO acquired the Presque Isle Power Plant
from the Upper Peninsula Power Company (``UPPCO''). At
the time, UPPCO was the licensee of one Land Mobile
Station which was used in connection with the operation
of the power plant. Following the acquisition, UPPCO
continued to operate and manage the power plant for
WEPCO pursuant to a management agreement. UPPCO also
continued to operate the one station.
Ten years later, on January 1, 1998, the
management agreement between the companies terminated
and WEPCO assumed control of the station. WEPCO did
not seek or obtain Commission consent to the
substantial transfer of control of the station at that
time. Thereafter, on August 1, 1998, UPPCO requested
cancellation of the license without WEPCO's knowledge.
WEPCO continued to operate the station without
authority until April 19, 2000, when it was granted an
STA. WEPCO filed an application to re-license the land
mobile station at the Presque Isle Power Plant on June
26, 2000. The application was granted on December 5,
United Illuminating Company. On April 15, 1999,
Wisvest-Connecticut, LLC (``Wisvest-CT''), a wholly-
owned subsidiary of Wisvest Corporation (itself a
wholly-owned subsidiary of WEC), acquired two power
plants from United Illuminating Company through an
asset purchase. In connection with this transaction,
Wisvest-CT also acquired control of certain frequencies
associated with three land mobile stations licensed to
United Illuminating Company. Although the transaction
resulted in the substantial transfer of control of the
stations to Wisvest-CT, the companies did not timely
request Commission consent to the partial assignment of
the three licenses. On April 19, 2000, Wisvest?CT,
through WEC, obtained an STA to operate the stations
previously licensed to United Illuminating Company. On
June 23, 2000, Wisvest?CT filed a new application to
license the subject frequencies. The application was
granted on September 1, 2000.
In addition, Wisvest?CT began operating a land
mobile station on 451/456.0375 MHz in the mistaken
belief that the acquisition of the power plants also
included an entitlement to operate on these
frequencies. Wisvest?CT operated on these frequencies
without authorization until July 3, 2000, pursuant to
conditional authority. Wisvest?CT's new application to
license the frequencies was granted on September 21,
2000. Wisvest-CT also began operating a new marine
coastal station using five frequencies when it acquired
the power plants from United Illuminating Company
without authority. Wisvest-CT was granted a license to
operate the facilities on June 24, 1999.
5. For the purposes of this Consent Decree, the following
definitions shall apply:
(a) "Commission" means the Federal Communications Commission.
(b) "Bureau" means the Commission's Enforcement Bureau.
(c) "WEC'' means Wisconsin Energy Corporation.
(d) "Order" means the order of the Enforcement Bureau
adopting this Consent Decree.
(e) "Final Order" means the Order that is no longer subject
to administrative or judicial reconsideration, review,
appeal, or stay.
(f) ``Act'' means the Communications Act of 1934, as
amended, Title 47 of the United States Code.
6. WEC agrees that the Bureau has jurisdiction over the matters
contained in this Consent Decree and the authority to enter into
and adopt this Consent Decree.
7. The Bureau and WEC agree that this Consent Decree does not
constitute an adjudication on the merits or any finding on the
facts or law regarding any violations of the Act or the
Commission's rules committed by WEC.
8. WEC agrees that it shall make a voluntary contribution to
the United States Treasury in the amount of $25,000.00 within 10
calendar days after the Bureau releases the Order adopting this
9. WEC agrees to implement, within 10 calendar days after the
Bureau releases the Order adopting this Consent Decree, a
comprehensive internal program, a summary of which is attached
hereto, to ensure WEC's future compliance with the Act, the
Commission's rules, and the Commission's policies.
10. In express reliance upon the representations contained
herein, the Bureau agrees to terminate its investigation into the
matters discussed in paragraphs 3 - 4, above.
11. The Bureau agrees not to institute any new proceeding,
formal or informal, of any kind against WEC for apparent
violations of Section 310(d) of the Act or Section 301 of the Act
arising from the matters discussed in paragraphs 3 - 4, above.
12. In the event that WEC is found by the Commission or its
delegated authority to have engaged in a violation of Section
310(d) of the Act and/or Section 301 of the Act subsequent to the
release of the Order adopting this Consent Decree, WEC agrees
that the conduct described in paragraphs 3 - 4, above, may be
considered by the Commission or its delegated authority in
determining an appropriate sanction.
13. WEC waives any and all rights it may have to seek
administrative or judicial reconsideration, review, appeal or
stay, or to otherwise challenge or contest the validity of this
Consent Decree and the Order adopting this Consent Decree,
provided the Order is limited to adopting the Consent Decree
without change, addition, or modification.
14. WEC and the Bureau agree that the effectiveness of this
Consent Decree is expressly contingent upon issuance of the
Order, provided the Order adopts the Consent Decree without
change, addition, or modification.
15. WEC and the Bureau agree that in the event that this Consent
Decree is rendered invalid by any court of competent
jurisdiction, it shall become null and void and may not be used
in any manner in any legal proceeding.
16. WEC and the Bureau agree that if WEC, the Commission, or the
United States on behalf of the Commission, brings a judicial
action to enforce the terms of the Order adopting this Consent
Decree, neither WEC nor the Commission shall contest the validity
of the Consent Decree or Order, and WEC and the Commission shall
waive any statutory right to a trial de novo with respect to any
matter upon which the Order is based (provided in each case that
the Order is limited to adopting the Consent Decree without
change, addition, or modification), and shall consent to a
judgment incorporating the terms of this Consent Decree.
17. WEC agrees to waive any claims it may otherwise have under
the Equal Access to Justice Act, Title 5 U.S.C. § 504 and 47 C.F.
R. § 1.1501 et seq., relating to the matters discussed in
3 - 4 , above.
18. WEC agrees that any violation of the Order adopting this
Consent Decree shall constitute a separate violation and subject
WEC to appropriate administrative sanctions.
19. WEC and the Bureau agree to be bound by the terms and
conditions stated herein.
20. WEC and the Bureau agree that this Consent Decree may be
signed in counterparts.
FEDERAL COMMUNICATIONS COMMISSION
David H. Solomon Date
WISCONSIN ENERGY CORPORATION
Larry Salustro Date
General Counsel and Senior Vice President
SUMMARY OF COMPLIANCE PROGRAM
WISCONSIN ENERGY CORPORATION
Corporate Compliance Program to Include FCC Regulations
WEC's Section 310(d) and Section 301 compliance program is
part of a larger FCC compliance program that involves the
following elements: a compliance manual and a training program,
which include identifying and handling potential transfers
covered by Section 310(d) and proper operations pursuant to
WEC's Compliance Manual
A compliance manual has been developed and will be updated
as necessary. WEC's licensing personnel have ready access to the
compliance manual and are to follow the procedures contained in
it. Such personnel are also encouraged to contact the company's
law department with any questions they may have.
Compliance Training Program
WEC in conjunction with its outside telecommunications
counsel, has established an FCC compliance training program
specifically geared to employees who engage in FCC licensing-
related activities. The program includes a thorough review of
FCC transfer of control issues. It is anticipated that training
sessions will be conducted at least annually to ensure compliance
with the Communications Act of 1934, as amended, and the FCC's
WEC has a centralized process for the handling of all FCC
licensed facilities and related FCC applications and matters.
This will help ensure that all FCC rules and regulations are
being adhered to prior to and during any corporate restructuring,
acquisitions or related transactions. WEC is sensitive to the
requirements of 47 U.S.C. § 310(d) and § 301 and will maintain
open communications among its personnel in order to prevent any
pro forma or substantive unauthorized assignments and/or
transfers of control and operations of stations without