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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 Petition of the Public Utility Commission of Texas for Expedited Decision for Authority to Implement Number Conservation Measures ) ) ) ) ) CC Docket No. 96-98 NSD File No. L-99-55 ORDER Adopted: November 30, 1999 Released: November 30, 1999 By the Deputy Chief, Common Carrier Bureau: I.INTRODUCTION 1. This order responds to the July 2, 1999, Petition of the Public Utility Commission of Texas (Texas Commission) for Expedited Decision for Authority to Implement Number Conservation Measures (Petition) requesting additional authority from the Commission to implement various area code conservation measures in Texas. We herein conditionally grant the Texas Commission the authority to institute thousands-block pooling trials; reclaim unused and reserved NXX codes, and thousand-number blocks within those codes; require the submission of utilization and forecast information to the Texas Commission; and require sequential number assignment. 2. Many of the measures proposed in the Petition are also examined in a Notice of Proposed Rulemaking that the Commission released earlier this year. Although we grant the Texas Commission interim authority to institute many of the optimization measures in the Petition, we do so subject to the caveat that this grant will be superseded by forthcoming decisions in the Numbering Resource Optimization proceeding that will establish national guidelines, standards, and procedures for numbering optimization. This limited grant of delegated authority should not be construed as a prejudgment of any of the measures on which the Commission has sought public comment in the Numbering Resource Optimization Notice. III.BACKGROUND 4. Congress granted the Commission plenary jurisdiction over numbering issues. Section 251(e)(1) of the Act also allows the Commission to delegate to state commissions all or any portion of its jurisdiction over numbering administration. The Commission's regulations generally require that numbering administration: (1) facilitate entry into the telecommunications marketplace by making telecommunications resources available on an efficient and timely basis to telecommunications carriers; (2) not unduly favor or disfavor any particular industry segment or group of telecommunications consumers; and (3) not unduly favor one telecommunications technology over another. Further, our regulations specify that, if the Commission delegates any telecommunications numbering administration functions to any state, the states must perform the functions in a manner consistent with these general requirements. 5. On September 28, 1998, the Commission released the Pennsylvania Numbering Order delegating additional authority to state commissions to order NXX code rationing in conjunction with area code relief decisions, in the absence of industry consensus. The order further approved a mandatory thousands-block number pooling trial in Illinois. The order provided that state utility commissions could order voluntary pooling trials, but in view of the Commission's efforts to develop national pooling standards, we declined to delegate to state commissions the general authority to order mandatory number pooling. The Pennsylvania Numbering Order, however, encouraged state commissions to seek further limited delegations of authority to implement other innovative number conservation methods prior to implementing number conservation plans. 6. In September 1999, the Commission addressed five similar petitions from state utility commissions. The Commission, in those five orders, addressed all of the issues raised in the instant Petition. The instant Petition raises no new issues, and therefore, pursuant to the authority delegated to the Common Carrier Bureau (Bureau) in the Pennsylvania Numbering Order, we address the Petition herein. 7. In its Petition, the Texas Commission requests that it be granted the authority to: (1) implement thousands-block number pooling; (2) implement unassigned number porting; (3) reclaim unused NXX codes and thousand-number blocks within those codes; (4) require all codeholders to provide the Texas Commission with information regarding numbering utilization and forecast data; and (5) order that carriers assign numbers sequentially. The Texas Commission states that it requests this additional authority to help protect the public interest against unwarranted area code relief. The Texas Commission also states that it is particularly sensitive to the pressing need for number conservation given the recent explosive demand for numbering resources in many of Texas's large metropolitan areas. On July 14, 1999, the Petition was placed on Public Notice for public comment. VIII.DISCUSSION 9. We recognize that the area code situation in Texas is critical, with eleven new area codes added since 1990, and with two cities, Dallas and Houston, requiring area code relief only two years after implementation of new area codes. To empower the Texas Commission to take steps to make number utilization more efficient, we herein grant significant additional authority to the Texas Commission. In some instances, we are granting the Texas Commission authority that goes beyond the parameters outlined in the Pennsylvania Numbering Order, because we find such grant to be appropriate in light of the specific circumstances in Texas. 10. Congress granted the Commission exclusive jurisdiction over those portions of the North American Numbering Plan (NANP) that relate to the United States, and directed that the Commission administer the NANP in a manner which assures that numbering resources are available on an equitable basis. The Commission was also granted the authority to delegate this jurisdiction to state utility commissions. Thus, while we grant authority below to the Texas Commission to engage in various matters related to administration of the NANP in Texas, we require the Texas Commission to abide by the same general requirements that the Commission has imposed on the numbering administrator. Thus, the Texas Commission, to the extent it acts under the authority delegated herein, must ensure that numbers are made available on an equitable basis; that numbering resources are made available on an efficient and timely basis; that whatever policies the Texas Commission institutes with regard to numbering administration not unduly favor or disfavor any particular telecommunications industry segment or group of telecommunications consumers; and that the Texas Commission not unduly favor one telecommunications technology over another. 11. The grants of authority herein are not intended to allow the Texas Commission to engage in number conservation measures to the exclusion of, or as a substitute for, unavoidable and timely area code relief. While we are giving the Texas Commission tools that may prolong the lives of existing area codes, the Texas Commission continues to bear the obligation of implementing area code relief when necessary, and we expect the Texas Commission to fulfill this obligation in a timely manner. Under no circumstances should consumers be precluded from receiving telecommunications services of their choice from providers of their choice for a want of numbering resources. For consumers to benefit from the competition envisioned by the Telecommunications Act of 1996, it is imperative that competitors in the telecommunications marketplace face as few barriers to entry as possible. 12. Several commenting parties argue that the Petition should be granted in its entirety on the basis that state utility commissions require greater authority to implement number conservation measures in order to rectify the causes of area code exhaust. Other parties suggest that the Petition be denied on the basis that number conservation measures must be developed at the national level, and that the Petition does not provide an adequate basis on which to grant the requested delegations of authority. 13. Thousands-block number pooling. The Texas Commission requests authority to institute thousands-block number pooling noting that service providers expressed unwillingness to participate in a voluntary pooling trial. The Commission tentatively concluded that thousands-block pooling is an important numbering resource optimization strategy, essential to extending the life of the NANP. In granting the Illinois Commission the authority to engage in a mandatory thousands-block pooling trial in the Pennsylvania Numbering Order, the Commission recognized that state number pooling trials could aid in developing national pooling implementation, architecture, and administrative standards. 14. In prior orders, the Commission has granted several state public utility commissions the authority to implement thousands-block pooling trials. In so doing, the Commission considered support for the proposal, as well as concerns regarding the burdens that thousands-block pooling trials might impose. The Commission noted that, in spite of the potential for strain on the network occasioned by multiple pooling trials, the relatively small volume of ported numbers and the importance of providing relief to states experiencing severe strain on their numbering resources weighed heavily in favor of delegating authority to implement number pooling trials. 15. Since the release of the Pennsylvania Numbering Order, the telecommunications industry has arrived at detailed guidelines governing the technical and administrative functioning of thousands-block number pooling. In the Pennsylvania Numbering Order, the Commission stated that, upon the establishment of uniform, national standards for pooling, it may determine that it is appropriate to delegate to state commissions the additional authority to implement and enforce those standards. 16. Parties to the instant proceeding raise issues similar to those that the Commission addressed in its prior orders. Because no new issues peculiar to Texas have been raised, based on Commission precedent, we therefore grant authority to the Texas Commission to conduct mandatory thousands-block number pooling trials in Texas, subject to the same conditions the Commission has previously imposed. 17. We direct the Texas Commission to conduct its pooling trials in accordance with industry-adopted thousands-block pooling guidelines. Where the Texas Commission determines that changes, modifications, or departures from the guidelines are desirable, we direct the Texas Commission to consult with the industry prior to implementing such changes. Although we will not dictate the manner in which the Texas Commission should consult with industry, it should, at a minimum, seek input from the industry regarding the implications of any proposed changes to the guidelines so that it may be able to weigh the industry's concerns in its decision-making process. 18. We grant this authority subject to the conditions and safeguards similar to those enumerated in the Pennsylvania Numbering Order that granted such authority to Illinois. Thus, we require that in any NPA which is in jeopardy in which the Texas Commission implements a pooling trial, the Texas Commission must take all necessary steps to prepare an NPA relief plan that may be adopted by the Texas Commission in the event that numbering resources in the NPA at issue are in imminent danger of being exhausted. This criterion is not intended to require the Texas Commission to implement an NPA relief plan prior to requiring thousands-block number pooling in Texas. Rather, we require only that the Texas Commission must be prepared to implement a "back-up" NPA relief plan prior to the exhaustion of numbering resources in the NPA at issue. Consumers should never be in the position of being unable to exercise their choice of carrier because that carrier does not have access to numbering resources. This criterion attempts to ensure that consumers continue to retain a choice of telecommunications providers in the event that the pooling trial or trials do not stave off the need for area code relief. 19. Only those carriers that have implemented permanent LNP shall be subject to the trial. At the present time, we do not grant the state commission the authority to require a carrier to acquire LNP solely for the purpose of being able to participate in a thousands-block pooling trial. Carriers are only required to implement LNP if requested by another carrier subject to the requirements established by the Commission. Within NPAs that are subject to the pooling trial, non-LNP capable carriers shall have the same access to numbering resources after pooling is implemented that they had prior to the implementation of a pooling regime, i.e., non-LNP capable carriers shall continue to be able to obtain full NXX codes. We recognize that conditioning the Texas Commission's authority to implement a mandatory thousands-block pooling trial on exemption of non-LNP capable carriers from participation in the trial will create a disparity in the way different types of service providers obtain access to numbering resources, in tension with the criteria set forth above. In order to ensure that consumers may continue to obtain service from non-LNP capable carriers of their choosing, however, we find that for the purposes of this interim delegation, it is necessary to safeguard these carriers' access to numbering resources, while they lack the technical capability to participate in pooling. The Numbering Resource Optimization Notice raises a number of issues relating to non-LNP capable carriers' participation in pooling, and we believe these issues are best addressed in the larger rulemaking context. In the meantime, we suggest to the Texas Commission that it urge the non-LNP capable carriers to use various other numbering resource optimization strategies such as those discussed in the Numbering Resource Optimization Notice to improve the efficiency of numbering resources assigned to such carriers. 20. We direct the Texas Commission to ensure that an adequate transition time is provided to carriers to implement pooling in their switches and administrative systems. Thousands-block pooling requires carriers to alter significantly the manner in which they account for their inventory of telephone numbers, including changing their Operations Support Systems (OSSs) and retraining their staffs. In addition, we also urge the Texas Commission not to require carriers to engage in processes related to thousands-block pooling which might divert critical resources away from preparations related to the Year 2000 rollover. 21. We further require that the Texas Commission determine the method to recover the costs of the pooling trial. The Texas Commission must also determine how carrier- specific costs directly related to pooling administration should be recovered. The Commission has tentatively concluded that thousands-block number pooling is a numbering administration function, and that section 251(e)(2) authorizes the Commission to provide the distribution and recovery mechanisms for the interstate and intrastate costs of number pooling. We conclude that, inasmuch as we are hereby delegating numbering administration authority to the Texas Commission, the Texas Commission must abide by the same statute applicable to the Commission, and, therefore, ensure that costs of number pooling are recovered in a competitively neutral manner. We note that the Telephone Number Portability proceeding found that section 251(e)(2) requires all carriers to bear the costs of number portability on a competitively neutral basis, and, thus, established a cost recovery mechanism that assesses even carriers that cannot or have not implemented LNP to date. The Texas Commission may consider the recently released Telephone Number Portability Order for guidance regarding the criteria with which a cost recovery mechanism must comply in order to be considered competitively neutral: First, "a 'competitively neutral' cost recovery mechanism should not give one service provider an appreciable, incremental cost advantage over another service provider, when competing for a specific subscriber." Second, the cost recovery mechanism "should not have a disparate effect on the ability of competing service providers to earn normal returns on their investments." Consistent with the Commission's treatment of cost recovery in the Telephone Number Portability proceeding, we believe that even those carriers that cannot participate in pooling at this time will benefit from the more efficient use of numbering resources that pooling will facilitate. We also encourage the Texas Commission to consider the "road map" provided by the Numbering Resource Optimization Notice regarding cost recovery for thousands-block number pooling. 22. In order to minimize possible disruption and expense and maximize the value of the information that can be obtained from a number pooling trial, we believe that such a trial should be limited in nature. As an initial matter, we limit the authority we grant to the Texas Commission to a trial that generally covers one Metropolitan Statistical Area (MSA). We believe that such a limitation strikes the appropriate balance between the Texas Commission's desire to move quickly to implement measures that will enhance number utilization efficiency, and possibly prolong the lives of certain area codes in Texas and our obligation to ensure that such pooling trials are implemented and conducted in a manner that does not disrupt network operations or reliability. We believe these goals ultimately benefit consumers in Texas by allowing the Texas Commission to move forward with a pooling trial quickly in whatever area it determines it is most necessary, while providing some assurance that the network changes required for the trials are implemented in a manner that does not disrupt the normal functioning of the network in Texas and nationwide. 23. After having implemented a thousands-block number pooling trial in one MSA, the Texas Commission may wish to expand to another MSA. Should it wish to do so, we direct the Texas Commission to allow sufficient transition time for carriers to undertake any necessary steps, such as modifying databases and upgrading switch software, to prepare for an expansion of thousands-block pooling to other MSAs. In other words, start dates for thousands-block pooling trials in different MSAs should be appropriately staggered to permit the industry to undertake all necessary steps. The purpose of a staggered roll-out is to provide carriers time to upgrade or replace their Service Control Points (SCPs) and other components of their network, as necessary, if the increased volume of ported numbers as a result of the pooling trial requires them to do so. 24. We suggest to the Texas Commission that it consider concentrating its thousands- block pooling trial in those NPAs which are the best candidates for pooling, based on the considerations set forth in the Numbering Resource Optimization Notice. For example, we encourage the Texas Commission to consider number pooling in areas where multiple LNP- capable carriers exist. We also suggest to the Texas Commission that it allow for exceptions to participating in a pooling trial, if doing so would prove prohibitively expensive to a particular carrier. For example, certain switch types may not be able to accommodate thousands-block number pooling. Finally, as the Commission stated in the Numbering Resource Optimization Notice, we encourage the Texas Commission, to the extent it has not already done so, to consider further consolidation of rate centers prior to implementing pooling. Fewer, larger pools logically increase the effectiveness of thousands-block pooling. 25. We reiterate that the authority we grant herein to the Texas Commission to undertake thousands-block pooling trials is interim in nature, and is in no way intended to relieve the Texas Commission of its obligation to implement necessary area code relief in a timely fashion. Whatever decisions the Commission reaches with regard to thousands-block pooling administration and guidelines will supersede whatever systems the Texas Commission puts in place prior to enactment of those rules. 26. Reclamation of unused and reserved NXX codes and thousand-number blocks. The Texas Commission requests the authority to reclaim unused NXX codes. The CO Code Assignment Guidelines provide that carriers shall activate NXXs within six months of the "initially published effective date." In prior orders, the Commission has granted state commissions the authority to reclaim unused NXX codes, and has recognized the value in reclaiming those codes. 27. Parties commenting in the instant proceeding have not raised any new concerns. Based on Commission precedent, we grant authority to the Texas Commission to investigate whether code holders have activated NXXs assigned to them within the time frames specified in the CO Code Assignment Guidelines, and to direct the NANPA to reclaim NXXs that the Texas Commission determines have not been activated in a timely manner. This authority necessarily implies that the Texas Commission may request proof from all code holders that NXX codes have been "placed in service" according to the CO Code Assignment Guidelines. We further direct the NANPA to abide by the Texas Commission's determination to reclaim an NXX code if the Texas Commission is satisfied that the code holder has not activated the code within the time specified by the CO Code Assignment Guidelines. 28. We note that the CO Code Assignment Guidelines dictate substantial procedural hurdles prior to reclamation of an unused NXX, in part to afford the code holder an opportunity to explain the circumstances that have led to a delay in code activation. The Commission earlier recognized that new entrants, in particular, may suffer unexpected delays or scheduling setbacks beyond their control, which may lead to code activation delays. We clarify that the Texas Commission need not follow the reclamation procedures set forth in the CO Code Assignment Guidelines relating to referring the issue to the Industry Numbering Committee (INC), as long as the Texas Commission accords the code holder an opportunity to explain the extenuating circumstances behind the unactivated NXX codes. 29. The Texas Commission also requests the authority to reclaim unused thousand number blocks. In prior orders, the Commission recognized the utility to be gained in connection with number pooling trials through the reclamation of blocks of 1,000 numbers with no, or relatively low, contamination. Parties who commented on this aspect of the Petition raised issues similar to those the Commission addressed in these prior orders. Based on Commission precedent, to the extent we have delegated the authority to the Texas Commission to initiate thousands-block number pooling trials, we also delegate to it the authority to reclaim unused thousands blocks in connection with those trials. The conditions that apply to the implementation of a thousands-block number pooling trial shall also apply to any reclamation of unused blocks of numbers. In particular, the industry's guidelines regarding reclamation of thousands blocks shall apply to the Texas Commission. 30. Requiring submission of utilization, forecast data. The Texas Commission seeks the authority to require all codeholders to submit utilization and forecast data to the Texas Commission. In prior orders, the Commission granted similar authority to the public utility commissions of New York and Florida, determining that state commissions should be able to monitor carriers' use of numbering resources, if they choose to do so. Parties commenting on the instant Petition raise issues similar to those which the Commission already disposed of in prior orders. Based on Commission precedent, we therefore delegate authority to the Texas Commission to require carriers to submit to it information regarding number utilization and forecast demand for resources. We reiterate, however, that because this is a topic of the Numbering Resource Optimization Notice, this grant of authority is limited in duration until such time as the Commission enacts rules or policies relating to auditing carriers' use of numbering resources. We also request that the Texas Commission not release such information to any entity other than the NANPA, this Commission, or the Common Carrier Bureau. 31. Sequential number assignment. The Texas Commission also seeks authority to require sequential number assignment. In a prior order, the Commission delegated authority to the California Public Utilities Commission to order sequential number assignment, and parties commenting on this aspect of the instant petition raise issues which the Commission considered in this prior order. Based on Commission precedent, we therefore grant the Texas Commission the authority to order sequential number assignment. We are concerned, however, that this requirement could interfere with a carrier's ability to satisfy a customer request for a particular set of numbers. In light of this concern, we urge the Texas Commission to allow carriers' some flexibility in assigning numbers sequentially. For example, like Illinois, the Texas Commission may simply wish to require that carriers assign a certain percentage of numbers from a given thousands-block prior to assigning numbers from another thousands-block to other customers. This allows for some flexibility for carriers to meet customer requests for numbers, as well as minimizing "contamination" of blocks of numbers for future implementation of thousands-block pooling. We also urge the Texas Commission to consult with other state commissions that may have already ordered carriers to implement sequential number assignment. 32. Unassigned Number Porting. The Texas Commission requests the authority to implement Unassigned Number Porting (UNP) as an additional tool to conserve numbering resources. As described in the 1998 NANC Numbering Resource Optimization Report (NANC Report), UNP is a telephone number usage optimization measure where available individual telephone numbers in one service provider's inventory are ported, using LNP, to another service provider under the direction of a neutral third party coordinator for assignment by the second service provider to a specific customer. In prior orders, the Commission agreed with commenters that UNP was at too early a stage of development to order implementation. The Commission also detailed its concerns that UNP might adversely affect service providers' switching systems. Because the arguments raised by parties commenting on this aspect of the instant Petition are similar to those already addressed by the Commission in prior orders, we decline to grant the Texas Commission's request for authority to implement UNP. 33. We emphasize, however, that our determination not to grant the Texas Commission the authority to order carriers to use UNP does not preclude carriers from voluntarily engaging in UNP where mutually agreeable and where there are no public safety or network reliability concerns. As a matter of fact, we encourage the carriers to do so. Furthermore, we also encourage the Texas Commission and the carriers to work together to identify and promote other innovative measures as well that would encourage the conservation of NXX codes. XXXIV.CONCLUSION 35. We recognize the difficult situation for consumers in Texas, having had to undergo several area code changes in only a few years, with the potential for more on the near horizon. The authority we have herein delegated to the Texas Commission, we hope, will provide it the tools it needs to address the situation. For example, the authority to order thousands-block pooling trials allows the Texas Commission to address inefficiencies on the supply side of the telephone number assignment regime by ordering that LNP-capable carriers receive smaller blocks of numbers than they now do. The authority to require sequential number assignment allows the Texas Commission to address the demand side of the number assignment regime by requiring that carriers not request more numbering resources until they have efficiently used numbers already in their inventory. XXXVI.ORDERING CLAUSE 37. Accordingly, pursuant to sections 1, 4(i), and 251 of the Communications Act of 1934, as amended, 47 U.S.C.  151, 154(i), and 251, and pursuant to sections 0.91, 0.291, 1.1 and 52.9(b) of the Commission's Rules, 47 C.F.R.  0.91, 0.291, 1.1 and 52.9(b), IT IS ORDERED that Petition of the Public Utility Commission of Texas for Expedited Decision for Authority to Implement Number Conservation Measures is GRANTED IN PART and DENIED IN PART to the extent described herein. FEDERAL COMMUNICATIONS COMMISSION Yog R. Varma Deputy Chief, Common Carrier Bureau