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Comment Sought on Domestic 214 Transfer of Subsidiaries of Hector

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Released: March 14, 2013

PUBLIC NOTICE

Federal Communications Commission

News Media Information 202 / 418-0500

445 12th St., S.W.

Internet: http://www.fcc.gov

Washington, D.C. 20554

TTY: 1-888-835-5322

DA 13-428

Released: March 14, 2013

DOMESTIC SECTION 214 APPLICATION FILED FOR THE

TRANSFER OF CONTROL OF

SUBSIDIARIES OF HECTOR COMMUNICATIONS CORPORATION

NON-STREAMLINED PLEADING CYCLE ESTABLISHED

WC Docket No. 13-55

Comments Due: March 28, 2013
Reply Comments Due: April 4, 2013

On February 20, 2013, Hector Communications Corporation (Hector), Blue Earth Valley
Communications, Inc. (Blue Earth Valley), Arvig Enterprises, Inc. (Arvig), and New Ulm Telecom, Inc.
(New Ulm) (together, Applicants) filed an application pursuant to section 63.03 of the Commission’s
rules1 requesting approval for the transfer of control of subsidiaries of Hector to either Blue Earth Valley,
Arvig, or New Ulm. Applicants consummated this transaction without authority on December 31, 2012.2
Applicants are not requesting streamlined treatment for this application.
Hector, a Minnesota corporation, was a holding company that provided, through its U.S.-based
subsidiaries, incumbent local exchange carrier (LEC) and long distance services in rural portions of
Minnesota, Wisconsin, and North Dakota. The subsidiaries are: (1) Granada Telephone Company
(incumbent LEC and long distance service in Granada, Minnesota); (2) Hager Telecom, Inc. (incumbent
LEC and long distance service in Hager City and Bay City, Wisconsin); (3) Indianhead Telephone
Company (incumbent LEC and long distance service in Exeland, Radisson, and Weyerhaeuser,
Wisconsin); (4) Pine Island Telephone Company (incumbent LEC and long distance service in Pine
Island and Oronoco, Minnesota); (5) Arrowhead Communications Corp. (incumbent LEC and long
distance service in Bena and Cotton, Minnesota); (6) Eagle Valley Telephone Company (incumbent LEC
and long distance service in Clarissa, Minnesota); (7) Felton Telephone Company (incumbent LEC and


1 47 C.F.R § 63.03; see 47 U.S.C. § 214. Applicants also filed applications for a transfer of control associated with
authorization for international and wireless services. Any action on this domestic section 214 application is without
prejudice to Commission action on other related, pending applications. Applicants filed a supplement to their
domestic section 214 application on March 7, 2013.
2 Applicants filed a request for special temporary authority (STA) to allow them to continue to provide service to
customers while the domestic section 214 application is pending. On March 12, 2013, the Wireline Competition
Bureau granted the STA for the domestic authorization for a period of 60 days. Letter from Gerard J. Duffy,
Counsel, to Marlene H. Dortch, Secretary, FCC, WC Docket No. 13-55 (filed Mar. 7, 2013). A grant of the
domestic section 214 application will be without prejudice to any enforcement action by the Commission for non-
compliance with the Communications Act of 1934, as amended, or the Commission’s rules.

long distance service in Felton, Averill, Hitterdal, and Borup, Minnesota); (8) Loretel Systems, Inc.
(incumbent LEC and long distance service in Ada, Audubon, Cormorant, Frazee, Glyndon,
Hendrum/Perley, Lake Park, and Pelican Rapids, Minnesota); (9) Sleepy Eye Telephone Company
(incumbent LEC and long distance services in Sleepy Eye, Hanska, Goodhue, Bellechester, White Rock,
and Mazeppa, Minnesota); (10) Cannon Communications Corp. (long distance service in Red Wing,
Minnesota and nearby portions of western Wisconsin); (11) Indianhead Communications Company (long
distance service in Wisconsin).
Prior to the transaction, Hector was owned by Blue Earth Valley (33 percent), Arvig (33 percent),
and New Ulm (33 percent), all Minnesota telecommunications corporations. The following U.S. citizen
and U.S. entities own Blue Earth Valley: William V. Eckles (19.84 percent), Eckles Dynasty Trust #1
(37.33 percent), and Eckles Dynasty Trust #2 (39.58 percent). The following U.S.-based entities own
Arvig: Allen R. Arvig Revocable Trust (22.21 percent); Arvig Employee Stock Ownership Plan (36.70
percent). Applicants state that no person or entity owns or controls 10 percent of more of the equity of
New Ulm. Applicants further state that Blue Earth Valley, Arvig, and New Ulm each have subsidiaries
that have incumbent LEC service areas that are adjacent to the LEC service areas of one or more of the
distributed Hector affiliates.
Applicants state that they undertook a reorganization effective December 31, 2012 under which
they dissolved Hector and distributed its operating subsidiaries to the Hector stockholder that was
geographically closest and most capable of assuming operational control of each entity. As a result of the
reorganization, the following six subsidiaries were distributed to BCS Holdings, LLC, a wholly owned
subsidiary of Blue Earth Valley: Granada Telephone Company, Hager Telecom, Inc., Indianhead
Telephone Company, Pine Island Telephone Company, Cannon Communications Corp. and Indianhead
Communications Company. Alliance Telecommunications Corporation, an intermediate Hector
subsidiary that owns Arrowhead Communications Corp, Eagle Valley Telephone Company, Felton
Telephone Company, and Loretel Systems, Inc., was distributed to Arvig, and Sleepy Eye Telephone
Company was distributed to New Ulm.
Applicants state that a grant of the application will serve the public interest, convenience, and
necessity. They assert that Blue Earth Valley, Arvig, and New Ulm are experienced rural
telecommunications service providers and that the proposed transaction ensures that the Hector
subsidiaries will continue to receive high quality services at affordable rates.
Domestic Section 214 Application Filed for the Transfer of Control of the Subsidiaries of
Hector Communications Corporation, WC Docket No. 13-55 (filed Feb. 20, 2013).

GENERAL INFORMATION

The transfer of control identified herein has been found, upon initial review, to be acceptable for
filing as a non-streamlined application. The Commission reserves the right to return any transfer
application if, upon further examination, it is determined to be defective and not in conformance with the
Commission’s rules and policies. Pursuant to section 63.03(a) of the Commission’s rules, 47 CFR §
63.03(a), interested parties may file comments on or before March 28, 2013, and reply comments on or
before April 4, 2013.
Pursuant to section 63.52 of the Commission’s rules, 47 C.F.R. § 63.52,
commenters must serve a copy of comments on the Applicants no later than the above comment filing
date.
Pursuant to section 63.03 of the Commission’s rules, 47 CFR § 63.03, parties to this proceeding
should file any documents in this proceeding using the Commission’s Electronic Comment Filing System
(ECFS): http://fjallfoss.fcc.gov/ecfs2/.

In addition, e-mail one copy of each pleading to each of the following

:
1) Myrva Charles, Competition Policy Division, Wireline Competition Bureau,
myrva.charles@fcc.gov;
2) Jodie May, Competition Policy Division, Wireline Competition Bureau, jodie.may@fcc.gov;
3) David Krech, Policy Division, International Bureau, david.krech@fcc.gov; and
4) Jim Bird, Office of General Counsel, jim.bird@fcc.gov.
People with Disabilities: To request materials in accessible formats for people with disabilities
(braille, large print, electronic files, audio format), send an e-mail to fcc504@fcc.gov or call the
Consumer & Governmental Affairs Bureau at (202) 418-0530 (voice), (202) 418-0432 (tty).
The proceeding in this Notice shall be treated as a “permit-but-disclose” proceeding in
accordance with the Commission’s ex parte rules.3 Persons making ex parte presentations must file a
copy of any written presentation or a memorandum summarizing any oral presentation within two
business days after the presentation (unless a different deadline applicable to the Sunshine period applies).
Persons making oral ex parte presentations are reminded that memoranda summarizing the presentation
must (1) list all persons attending or otherwise participating in the meeting at which the ex parte
presentation was made, and (2) summarize all data presented and arguments made during the
presentation. If the presentation consisted in whole or in part of the presentation of data or arguments
already reflected in the presenter’s written comments, memoranda or other filings in the proceeding, the
presenter may provide citations to such data or arguments in his or her prior comments, memoranda, or
other filings (specifying the relevant page and/or paragraph numbers where such data or arguments can be
found) in lieu of summarizing them in the memorandum. Documents shown or given to Commission
staff during ex parte meetings are deemed to be written ex parte presentations and must be filed
consistent with rule 1.1206(b), 47 C.F.R. § 1.1206(b). Participants in this proceeding should familiarize
themselves with the Commission’s ex parte rules.
For further information, please contact Myrva Charles at (202) 418-1506 or Jodie May at (202)
418-0913.
-FCC-


3 47 C.F.R. §§ 1.1200 et seq.

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