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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 ) ) Guadalupe Valley Telephone Cooperative ) Request for LATA Relief Between the Waelder ) File No. NSD-L-97-43 Exchange and Corpus Christi LATA ) ) ) MEMORANDUM OPINION AND ORDER Adopted: March 2, 1998 Released: March 2, 1998 By the Deputy Chief, Network Services Division: I. INTRODUCTION 1. On October 1, 1997, Guadalupe Valley Telephone Cooperative, Inc. (GV), pursuant to Section 3(25) of the Communications Act of 1934, as amended, filed a petition requesting a change in the local access and transport area (LATA) association for one of its exchanges. GV requests that its Waelder, Texas exchange be associated with the San Antonio, Texas LATA rather than its present association with the Corpus Christi, Texas LATA. The Commission placed the petition on public notice, and the National Telephone Cooperative Association filed comments in support of GV's petition. For the reasons discussed below, we grant GV's request for a change in LATA association. II. BACKGROUND 2. On August 24, 1982, the United States District Court for the District of Columbia (District Court) entered an order (Consent Decree) that required AT&T to divest its ownership of the Bell Operating Companies (BOCs). The District Court divided all Bell territory in the continental United States into geographic areas called LATAs. Under the Consent Decree, the BOCs were permitted to provide telephone service within a LATA (intraLATA service), but were not permitted to carry traffic across LATA boundaries (interLATA service). InterLATA traffic was to be carried by interexchange carriers. The LATAs did not cover territory served by independent telephone companies (ITCs), and the ITCs were not subject to the restrictions imposed by the Consent Decree; thus, while a BOC could not carry traffic across a LATA boundary, an ITC could carry traffic regardless of whether that traffic crosses LATA boundaries. 3. The District Court, however, noted that there were often joint operating arrangements between independent exchanges and neighboring BOC facilities. For example, BOCs often switched traffic between their end offices and the end offices of the ITCs, which then carried the traffic to its final destination. If all of this traffic were considered interLATA, BOCs could not participate in these arrangements and significant and costly network rearrangements would have been necessary. To prevent the need for such rearrangements, the Court classified most independent exchanges as "associated" with a particular BOC LATA. Traffic between a BOC LATA and an associated exchange was treated as intraLATA and could be carried by the BOC; traffic between a BOC LATA and an unassociated exchange was treated as interLATA, and thus could not be carried by the BOC. 4. The District Court received more than a hundred additional requests involving LATA associations, including requests for new associations, disassociations, and changes in association from one LATA to another. The District Court developed a streamlined process for answering such requests both because of the large number of requests involved and because most of the requests were non-controversial. Under this process, the ITC would submit its request to the Department of Justice (DOJ). DOJ would review the request and then submit the request to the District Court along with DOJ's recommendation. The requests were typically filed because an ITC planned to upgrade its network in a manner that would require routing traffic through a BOC switch in a different LATA. The District Court generally granted these requests if the changes in associations would avoid the need for expensive network reconfiguration and would not endanger competition. In granting requests for a change in LATA association, the District Court also allowed the continuation of existing ELCS routes between the independent exchange and the original LATA. 5. Passage of the Telecommunications Act of 1996 (1996 Act), which amended the Communications Act of 1934 (Act), changed the procedure by which a LATA boundary is modified. Pursuant to the 1996 Act, matters previously subject to the Consent Decree are now governed by the Act. On August 6, 1997, the Commission released a decision granting 2 LATA association change requests. In that decision, the Commission established a set of guidelines to assist ITCs and BOCs in filing association petitions. Section 271(b)(1) of the Act prohibits a BOC from providing "interLATA services originating in any of its in-region States" until the BOC takes certain steps to open its own market to competition and the Commission approves the BOC's application to provide such service. "InterLATA service" is defined as "telecommunications between a point located in a local access and transport area and a point located outside such area," and thus would include traffic between an independent exchange and a BOC LATA. The Act does not specifically address LATA associations. Section 271(f), however, states that BOCs are not prohibited from engaging in an activity to the extent that such activity was previously authorized by the Court. Thus, the Commission concluded that BOCs may continue to provide service to independent exchanges that were classified as "associated" with a LATA by the Court. III. DISCUSSION 6. The GV petition requests that GV's Waelder exchange be allowed to change its association from the Corpus Christi LATA to the San Antonio LATA. Currently, GV serves 15 exchanges. According to the petition, because all of GV's customers in 14 of its exchanges receive equal access service through the San Antonio LATA, granting this petition would also allow GV to route all of its traffic, including to and from its Waelder customers, through the San Antonio LATA facilities and to provide equal access to its Waelder customers. GV states that, subsequent to this acquisition of the Waelder exchange from GTE Southwest, GV installed a digital switch, converted the exchange to one-party service, and now offers Waelder customers numerous features including caller ID. Nonetheless, GV states that its Waelder customers cannot presently reach their interexchange carrier of choice on a presubscribed basis absent dialing 800 numbers or using access codes. Additionally, GV also anticipates that, sometime in 1998, the area code for the Waelder exchange will change; thus, GV contends that granting its petition could prevent its Waelder customers from being subject to two area code changes. 7. In the August 1997 Order, the Commission stated that a carrier will be deemed to have made a prima facie case supporting its petition if the petition: (1) states that the association change is necessary due to planned upgrades to the ITC's network or service that will require routing through a different BOC LATA; (2) involves a limited number of access lines; and (3) includes a statement of support from the affected BOC. It is clear from the petition that the prima facie criteria have been satisfied. First, GV plans to route Waelder traffic from the Corpus Christi LATA through the San Antonio LATA and, thus, provide equal access capability for its Waelder customers. In addition, only 350 access lines are involved. GV has upgraded the network which serves the Waelder customers, and the association change will provide the Waelder customers with the equal access capabilities currently enjoyed by GV's customers associated with the San Antonio LATA. Finally, Southwestern Bell Telephone Company included a supplemental statement supporting the association change. 8. Accordingly, we conclude that the public interest will be served by granting GV's request that the Waelder exchange be associated with the San Antonio LATA. IV. ORDERING CLAUSES 9. 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), that the request of Guadalupe Valley Telephone Cooperative, Inc., File No. NSD-L-97-43, for a change of association for the Waelder exchange from the Corpus Christi LATA to the San Antonio LATA IS GRANTED. 10. 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, Guadalupe Valley Telephone Cooperative, Inc. FEDERAL COMMUNICATIONS COMMISSION Anna M. Gomez Deputy Chief, Network Services Bureau Common Carrier Bureau