NEWSReport No. CC 95-3     COMMON CARRIER ACTION           
January 4, 1995

       US WEST/EAGLE TELECOM GRANTED STUDY AREA BOUNDARY WAIVER; 
                STANDARD ADOPTED FOR DETERMINING IMPACT 
                      OF ALL FUTURE WAIVER REQUESTS

     The Commission has granted the joint request of US West
Communications, Inc., and
Eagle Telecommunications, Inc., for waiver of the definition of
"study area" contained in the
Commission rules and has established a standard to evaluate
whether a proposed transfer of
exchanges will have an adverse impact on the Universal Service
Fund (USF), a fund to
subsidize high-cost exchange operations.  This new standard will
apply to any waiver request
submitted after the release of this order. 

     The waiver will allow US West to sell 43 Colorado telephone
exchanges to Eagle. As
a result, US West will remove these 43 exchanges from its
Colorado study area and allow
Eagle to add them to its Colorado study area.  

          The Commission said it has three primary concerns in
evaluating petitions seeking
waiver of the study area boundaries.  These are: (1) that the
change not affect adversely the
USF support program; (2) that the state commissions having
regulatory authority do not
object to the change; and (3) that the public interest supports
grant of the waiver.  It said this
waiver request satisfies these three concerns.

     US West provides telephone service in 14 states, including
Colorado.  In Colorado, it
serves 2.2 million access lines and 146 exchanges.  Eagle
operates 8 exchanges that serve
approximately 7,700 access lines in Colorado.  US West stated
that it initiated this sale to
ensure that the 43 exchanges receive the most efficient network
service upgrades in
compliance with service standards mandated by the Colorado Public
Utilities Commission. 
Eagle has stated that it plans to complete a network
modernization program for these
exchanges and that this program will improve service quality. 
According to the petitioners,
the Colorado Commission and the Colorado Office of the Consumer
Counsel have found the
proposed transfer to be in the public interest because of the
improved service these areas will
receive.




                                  (over)



                                  - 2 - 

     In establishing the standard to evaluate the potential
adverse impact on the USF of
future study area waiver requests, the Commission stated that the
cumulative effect of
granting study area waivers could adversely impact the USF
assistance mechanism.  The
Commission put carriers on notice that in evaluating future study
area waiver requests, it will
scrutinize closely the effect of the proposed transfers on
existing recipients of USF
assistance.  The Commission noted that, absent extraordinary
public interest considerations,
study area waiver requests that are sought, by any one carrier,
either as a purchaser or
seller, as a result of transfers may not cause an annual
aggregate shift in USF assistance in
an amount equal to or greater than one percent of the total USF
for the year in which the
waiver request is filed.

     Eagle also sought, and the Commission granted, a waiver of
Commission rules to
permit it to continue to operate as a cost company rather than a
price cap company.

     Action by the commission January 4, 1995, by Memorandum
Opinion and Order
(FCC 95-4).  Chairman Hundt, Commissioners Quello, Barrett, Ness
and Chong.

  -FCC-


News Media contact: Susan Lewis Sallet at (202) 418-0500.
Common Carrier Bureau contacts: John S. Morabito at (202)
418-1580 and Ken Moran at
(202) 418-0800.