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XXViceChairman Hall Northcott, Matsushita Doug Horstman, Maytag Corp. Robert Cushman, Amana Ref. A. J. Takacs, Whirlpool Corp.  bD  ALTERNATE MEMBERS:  Dan Elliott, White Consolidated Inds. Michael Thompson, Whirlpool Corp  bD  PORT. APP. DIV. LIAISON: Joe Berney, National Presto Neil Halvorson, West Bend William Yager, Rival Mfrg. Gary Turner, Teledyne Water Pik  bDc  SUPPLIER DIV. LIAISON:  Robert Brown, Robertshaw Controls Steven Bowsher, Ryerson Coil  bD  INFORMATION COPIES:  David Wolbrink, Broan Mfrg. James Ruberti, Brown Stove Works Ted Baily, Carrier Corp. Roni Liberman, Cold Point Corp. Thomas Benua, Ebco Mfrg. John Verwiel, Emerson Electric Joel Zillioux, Friedrich Lisa Bloom, GoldStar Elect. William Brashares, AHAM Counsel Gordon Stauffer, Northland Corp. Russell Zipkin, Russell Range Bunzo Shiono, Sanyo Fisher (USA) Anne Howard, Sharp Electronics Allen Wilkins, SubZero Freezer James Robinson, Toshiba America Philip Uihlein, ULine Corp. 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?n9B8*X6B7  PT6QP, @n9G8*X8+G7  pTQ BDPC2XWXP7  PT6QXP, ADUC2XYXU7  pTQXj CDPC2X'XP7  xTQXX DO)0(X-h07  PT6QhP EB"(!X,(7  PT6Q,Pj n9C8*X'<C7  xTQX                     2SJ e2 #Xj\  P6G;WXP#. e2x QFederal Communications Commission`(#FCC 99222 ă  yxdddy   e2* Before the x Federal Communications Commission  e2Washington, D.C. 20554 ă ` `  MhhX In the Matter of2) 2)6Application for Review and Petition for2) Reconsideration or Clarification of 2)  e 2Declaratory Ruling Regarding U S West 2)XppNSDL976 Petitions to Consolidate LATAs in 2) Minnesota and Arizona2)  e 2| p MEMORANDUM OPINION AND ORDER ă   e2 Adopted: August 13, 1999  hhXppReleased: September 1, 1999 By the Commission:  I. A. 1. a.(1)(a) i) a) I. 1. a. a.(1)(a) i) a)  e42J I. INTRODUCTION ă   e2 @~1. On April 21, 1997, the Common Carrier Bureau (Bureau) released the LATA  e2 2!Modification Order, nZh( 2! ԍ Matter of Petition for Declaratory Ruling Regarding US West Petitions to Consolidate LATAs in Minnesota  nZ0(and Arizona, Order, DA 97767, 12 FCC Rcd 4738 (Com. Car. Bur. 1997) (LATA Modification Order). in which the Bureau ruled that the Federal Communications Commission  2!(FCC or Commission) has exclusive authority, pursuant to section 3(25)(b) of the  e2 2!Communications Act,D  nZ(ԍ 47 U.S.C.  153(25)(b).D to modify Local Access Transport Area (LATA) boundaries,+ nZ"( 2!jԍ LATA boundaries define the geographic area within which Bell Operating Companies (BOCs) may provide  nZ(service. See id.  153(25)(a). We use the term "BOC" as that term is defined in 47 U.S.C.  153(4).+ and did not  2!Rdelegate that power to any other entity. On May 20, 1997, U S WEST Communications, Inc.  e2 2!z(U S WEST) filed a petition for reconsideration or clarification with the Bureau of the LATA  e|2 2!BModification Order.X| nZ5"( 2!ԍ U S WEST's petition was filed under our rules of practice governing petitions for reconsideration. 47 C.F.R.  2! 1.106. Although the U S WEST petition is captioned a petition for reconsideration or clarification, as we discuss  nZ#(below, U S WEST only asks for clarification of the LATA Modification Order.Ĝ The U S WEST petition has been referred to us by the Bureau.O|(  nZU%(ԍ See 47 C.F.R.  1.106(a)(1).O On May"| 0*''ZZ"  2!21, 1997, the Arizona Corporation Commission (ACC) filed an application for review or stay of  e2the LATA Modification Order.kX6, nZb( 2!ԍ ACC's application is filed under our rules of practice governing review of action taken pursuant to delegated  nZ*( 2!authority. See 47 C.F.R.  1.115. A list of parties that filed comments and reply comments to the ACC and U S WEST is attached as an appendix to this order.k  e2 d 2. ` ` On May 14, 1999, AT&T Corp. (AT&T) filed a motion for a standstill order  2!prohibiting U S WEST from (a) providing or offering to provide to customers in Arizona any  2!*interLATA service not described in  271(b)(2) or (b)(3), as defined with reference to the  2!LATA boundaries that were established by the Modification of Final Judgment (MFJ), unless and  2!until the requisite authority therefor has been expressly granted by the Commission; and (b)  2!taking any actions to procure or request an order from the ACC purporting to remove or revise  2!LATA boundaries in Arizona in a manner prohibited by the Telecommunications Act of 1996  e 2and the prior order in this proceeding.DX 6, nZ( 2!Bԍ On May 21, 1999, Sprint Corporation (Sprint) filed comments in support of AT&T's motion. On May 24,  2!1999, Qwest Communications Corporation (Qwest) filed comments in support of AT&T's motion and U S WEST filed comments in opposition to AT&T's motion.D  e 2 d 3. ` ` Because the LATA Modification Order is sufficiently clear that no clarification is  2!necessary, we deny U S WEST's petition. Further, because the Communications Act grants the  2!Commission exclusive jurisdiction to approve changes to any LATA boundaries, section 2(b) of  2!^the Act is not implicated. We thus affirm the Bureau's conclusion and deny the ACC's  2!Lapplication. Although we will not be addressing the AT&T motion for a standstill order today,  2!`our conclusions herein also reject arguments made by U S WEST in its opposition to the AT&T  2!motion that the ACC has any authority to establish or modify intrastate LATA boundaries and  2!should resolve any questions that U S WEST may have concerning whether it can provide service  2!|across currently recognized LATA boundaries without first seeking a LATA boundary modification from this Commission.  e2f II. BACKGROUND ă  e2 @x4. The Bureau released the LATA Modification Order in response to a petition for  2!jdeclaratory ruling filed by the Competition Policy Institute (CPI) and the Minnesota Department  e2 2!of Public Service (MDPS) on March 4, 1997.6, nZL!(ԍ The CPI/MDPS petition was filed under the Commission's rules of practice at 47 C.F.R.  1.2. The CPI/MDPS petition requested that the Bureau  e|2 2!\issue a declaratory ruling that the Commission in the Local Competition Second Report and"|0*%%ZZ"  e2 2!Order8 6, nZy( 2!ԍ Implementation of the Local Competition Provisions of the Telecommunications Act of 1996, CC Docket No.  nZA( 2!$9698, Second Report and Order and Memorandum Opinion and Order, 11 FCC Rcd 19392 (1996) (Local  nZ ( 2!Competition Second Report and Order), vacated in part, People of the State of California v. FCC, 124 F.3d 934 (8th  nZ(Cir. 1997), rev., AT&T Corp. v. Iowa Util. Bd., 119 S. Ct. 721 (Jan. 25, 1999).8 did not delegate to the states authority to approve the establishment or modification of  2!&LATA boundaries, and that this authority remains with the Commission. CPI and MDPS  2!requested that the Bureau rule on this issue because U S WEST had filed petitions with the ACC  2!and the Minnesota Public Utilities Commission (MPUC), asking that those commissions make  e2the LATAs in their states coextensive with state boundaries.z X6, nZ ( 2!~ԍ As CPI/MDPS noted, U S WEST had argued before the Arizona and Minnesota state commissions that the  nZ ( 2!Commission in the Local Competition Second Report and Order had delegated to the states authority to modify LATA boundaries in the manner requested by U S WEST. CPI/MDPS petition at 46.z  ev2 @<5. In responding to the CPI/MDPS petition, U S WEST argued, inter alia, that the  2!tdetermination of an intrastate LATA boundary is the type of wholly intrastate matter over which  eH2 2!section 2(b) of the Communications Act H6, nZ(ԍ 47 U.S.C.  152(b). In pertinent part, section 2(b) states that:  d pXX` ` [N]othing in this Act shall be construed to apply or to give the Commission  d pjurisdiction with respect to (1) charges, classifications, practices, services, facilities, or regulations for or in connection with intrastate communication.x` ƞ precludes Commission jurisdiction.B H 6, nZy(ԍ U S WEST Comments at 11.B The ACC agreed  2!with U S WEST that under section 2(b) of the Act, the modification of intrastate LATA  2!boundaries is a matter reserved to state jurisdiction, and argued that as a result the ACC is the  2!.appropriate governmental entity to make a decision regarding all intrastate telecommunications  e 2matters in Arizona, including the LATA modification petition filed by U S WEST.D 6, nZ(ԍ ACC Comments at pages 35.D  e 2 @6. The Bureau, in the LATA Modification Order, first rejected the argument made by U  e 2 2!S WEST and the ACC that section 2(b) limits Commission jurisdiction over LATA boundaries._ 6, nZ(ԍ LATA Modification Order, 12 FCC Rcd at 474648._  2!(The Bureau explained that LATAs are a purely federal creation and never have been administered  2!by the states. Rather, the U.S. District Court for the District of Columbia (U.S. District Court)  2!$divided all territory in the continental United States served by the BOCs into LATAs as part of  2!its approval of the AT&T Consent Decree, which resolved a lawsuit brought under federal"K00*%%ZZ"  e2 2! antitrust law.# 6, nZy( 2!ԍ Id. at 4746 (citing United States v. American Telephone and Telegraph Co., 552 F. Supp. 131 (D.D.C. 1982),  nZA( 2!aff'd sub nom. Maryland v. United States, 460 U.S. 1001 (1983)). The 1996 Act defines "AT&T Consent Decree"  2!as including the Modification of Final Judgment (MFJ) under which the BOCs were divested from AT&T as well as all subsequent judgments or orders related to the MFJ. 47 U.S.C.  153(3). # Under the AT&T Consent Decree, BOCs were permitted to provide local and toll  2!service within each LATA (i.e., intraLATA service), but were prohibited from providing service  2!across LATA boundaries (i.e., interLATA service). All interLATA traffic was to be carried by  2!interexchange carriers. The U.S. District Court acted as the sole forum for matters concerning  e2LATA boundaries, and held that the decree preempted all inconsistent state law.6, nZ ( 2!ԍ LATA Modification Order, 12 FCC Rcd at 474647, citing United States v. Western Electric, 569 F. Supp. 990, 99394 (D.D.C. 1983).  ev2 @7. The Bureau concluded that Congress, in the Telecommunications Act of 1996 (1996  e_2 2!`Act), _6, nZ( 2!ԍ Telecommunications Act of 1996, Pub. L. No. 104104, 110 Stat. 56 (1996 Act) (codified at 47 U.S.C.   nZ( 2!n151 et seq.). Hereinafter, all citations to the 1996 Act will be to the 1996 Act as it is codified in the United States  2!Code. The 1996 Act amended the Communications Act of 1934. We will refer to the Communications Act of 1934, as amended, as "the Communications Act" or "the Act." shifted authority over LATA boundaries from the U.S. District Court to the Commission.  2!The Bureau pointed out that section 601(a) of the 1996 Act makes "[a]ny conduct or activity"  e12 2!formerly subject to the AT&T Consent Decree subject to the Act.A1 6, nZ(ԍ 47 U.S.C  152 (nt).A Section 251(g), in turn,  2!Nexplicitly delegates to the Commission sole authority to administer the "equal access and  2!nondiscriminatory interconnection restrictions and obligations" that applied under the AT&T  e 2 2!Consent Decree,@ 6, nZ(ԍ Id.  251(g).@ of which exclusive authority over LATA boundary establishment or  e 2 2!modification is an essential component.\ 6, nZ(ԍ LATA Modification Order, 12 FCC Rcd at 4748.\ The Bureau noted that section 3(25) of the ActA 6, nZ&(ԍ 47 U.S.C.  153(25).A  2! defines a LATA as a "contiguous geographic area . . . established or modified by a Bell operating  e 2 2!company . . . and approved by the [Federal Communications] Commission."v 06, nZ (ԍ LATA Modification Order, 12 FCC Rcd at 4748 (emphasis added in order).v Accordingly, the  2!Bureau concluded that the 1996 Act explicitly conferred exclusive jurisdiction over LATA  2!boundaries on the Commission, that no construction of the statute was necessary, and that as a  eb2result, section 2(b) does not limit the Commission's authority to modify LATA boundaries.?b6, nZ$(ԍ Id. at 474648.?"bP0*%%ZZ"Ԍ e2 @rԙ8. The Bureau further explained that the Commission had not delegated authority over  2!the administration of LATA boundaries to state commissions. The Bureau stated that in the  e2 2!$Local Competition Second Report and Order the Commission had adopted rules to implement  e2 2!4section 251(b)(3) of the ActC6, nZ4(ԍ 47 U.S.C.  251(b)(3).C that allowed states to implement dialing parity on the basis of  e2 2!either state or LATA boundaries, X6, nZ(ԍ LATA Modification Order, 12 FCC Rcd at 474950. Under section 251(b)(3):  XEach local exchange carrier has ... the duty to provide dialing parity to competing providers of  <telephone exchange service and telephone toll service, and the duty to permit all such providers  |to have nondiscriminatory access to telephone numbers, operator services, directory assistance, and directory listing, with no unreasonable dialing delays.  47 U.S.C.  251(b)(3). The Act defines "dialing parity" to mean that:  Xa person that is not an affiliate of a local exchange carrier is able to provide telecommunications  Pservices in such a manner that customers have the ability to route automatically, without the use  of any access code, their telecommunications to the telecommunications service provider of the  xcustomer's designation from among 2 or more telecommunications service providers (including such local exchange carrier).  47 U.S.C.  153(15). but in that Order had not delegated authority to modify LATA  e2 2!boundaries to the states.\6, nZ(ԍ LATA Modification Order, 12 FCC Rcd at 4749.\ According to the Bureau, the Commission anticipated that the  2!significance of LATA boundaries would decrease once the BOCs complied with the section 271  2!checklist, had begun to offer inregion interLATA service, and eventually, no longer needed to  eH2 2!Bcomply with the requirement that they provide interLATA service through a separate affiliate.H06, nZ)( 2!Lԍ Id. at 474950. The section 272 separate affiliate requirement for BOC provision of interLATA services sunsets three years after the date the BOC is authorized to provide interLATA service. 47 U.S.C.  272(f)(1).  e12 2!jThe Bureau noted that the Local Competition Second Report and Order thus permitted states to  2!ttake the ongoing significance of LATA boundaries into consideration, and have the flexibility to  2!require that toll dialing parity be implemented on the basis of state boundaries rather than on a  2!LATAbyLATA basis where the state determines that to do so would be procompetitive and  e 2 2!otherwise in the public interest.\ 6, nZ!(ԍ LATA Modification Order, 12 FCC Rcd at 4750.\ The Bureau then held that, by allowing the states such  2!flexibility, the Commission in no way delegated any authority over the modification of LATA  e 2boundaries to the states.3 6, nZp$(ԍ Id.3" 0*%%ZZ "Ԍ e2 @ԙ9. The Bureau concluded that the Act prohibited the Commission from delegating its  2!authority over LATA boundaries to the states until a BOC had satisfied the requirements of  e2 2!Hsection 271.?6, nZK(ԍ Id. at 475152.? The Bureau initially noted that section 271=X6, nZ(ԍ 47 U.S.C.  271.= prohibits a BOC from providing  2!8interLATA services until it has met a fourteenpoint checklist to open its intraLATA markets to  e2 2!2competition and the Commission approves the BOC's application to provide interLATA service. 6, nZ= ( 2!ԍ 47 U.S.C.  271(c)(2)(b) sets out fourteen requirements that must be met before incumbent BOCs may  2!provide inregion interLATA services. 47 U.S.C.  271(d)(1) permits BOCs to apply to the Commission for  2!interLATA service authority. 47 U.S.C.  271(d)(3)(C) provides for the Commission to approve or deny the applications.  e2 2!~Further, section 272(a) prohibits a BOC from providing inregion interLATA service directly.@!6, nZ(ԍ 47 U.S.C.  272(a).@  2!Rather, a BOC, once it obtains section 272 approval, must provide such services through a  e_2 2!>separate affiliate meeting the requirements of section 272(b).@"_` 6, nZp(ԍ Id.  272(b).@ Under section 272(f)(1), the  2!Lprovisions of section 272 (other than those in subsection (e)) sunset with respect to a particular  2!BOC three years after the BOC receives section 271 authority, unless the Commission extends  e 2 2!pthe 3year period by rule or order.C# 6, nZ(ԍ Id.  271(f)(1).C Finally, the Bureau noted that section 10(d) of the Act@$ 6, nZK(ԍ Id.  160(d).@  2!explicitly prohibits the Commission from taking any action that would constitute a forbearance  e 2 2!of its authority to ensure that section 271's requirements are fully implemented.\% 6, nZ(ԍ LATA Modification Order, 12 FCC Rcd at 4751.\ The Bureau  2!reasoned that, by allowing states to modify LATA boundaries in the manner proposed by U S  2!jWEST, the Commission would be allowing the states to transform what had been an interLATA  2!0call into an intraLATA call, thus allowing a BOC to provide interLATA service without  2!satisfying the section 271 checklist. Such a result, the Bureau concluded, would be the very type  ey2of forbearance prohibited by section 10(d).3&y6, nZ (ԍ Id.3  eK2 @ 10. In sum, the Bureau found that (1) Congress vested exclusive authority in this  e42 2!8Commission to define LATA boundaries; (2) the Commission in its Local Competition Second"40&0*%%ZZH"  e2 2!Report and Order did not delegate this authority to the states; and (3) such authority, if delegated to the states, would impermissibly circumvent section 271.  e2z < III. ACC'S APPLICATION FOR REVIEW OR STAY ă  e2X A. Background (#  e_2 @ 11. The ACC contends that we should review the Bureau's order because it addresses a  2!tquestion of law not previously resolved by the Commission, thus meeting one of the criteria that  2!4our rules of practice specify must be met to warrant Commission review of any action taken  e 2 2!:pursuant to delegated authority.I' 6, nZ (ԍ 47 C.F.R.  1.115(b)(2)(ii).I According to the ACC, the CPI/MDPS petition and the  2!subsequent Bureau order present "the novel question of interpretation of section 271(d) of the  e 2 2!1996 Act in conjunction with section[s] 2(b) and 10(d) of the Act."?( X6, nZ(ԍ ACC Application at 4.? The ACC asserts that  2!section 271(d) "delegates the authority to permit BOCs to provide interLATA services to the  2!FCC," and "[p]ursuant to section 10(d) of the Act, the FCC may not forbear from applying the  2!requirements of section 271 of the 1996 Act until it determines that those requirements have been  2!fully implemented," but that section 2(b) "specifically reserves jurisdiction over regulation of  ey2 2! intrastate telecommunication services to the state.";)y6, nZ(ԍ Id. at 34.; In other words, the ACC's argument is  2!based on the contention, rejected by the Bureau, that because 2(b) of the Act precludes  2!Commission jurisdiction over purely intrastate communications, it "preserves" to Arizona the  e42authority to define intrastate LATA boundaries.3*4x6, nZ](ԍ Id.3  e2 @ 12. Alternatively, the ACC requests that we stay the Bureau's Order on the ground that  2!the issue of whether states have the right to modify LATA boundaries should not be decided until  2!Bafter a BOC has met the requirements of the section 271 competitive checklist. ACC states that  2!it has opened dockets to monitor U S WEST's compliance with section 271 and to receive public  e2comment on U S WEST's request to modify LATA boundaries within Arizona.9+6, nZc (ԍ Id. at 5.9 "+0*%%ZZ"Ԍ e2 @@ 13. AT&T, CPI, MDPS, TCG, and TRA concur with the Bureau's conclusion that the  2!Commission possesses exclusive authority over LATA boundaries, and that the Commission did  e2not delegate that authority to the states.P,6, nZK(ԍ See, e.g., AT&T Comments at 57.P  e2X B. Discussion (#  ev2 @ 14. For the reasons stated below, we affirm the Bureau's conclusion in the LATA  e_2 2!Modification Order that Commission jurisdiction over LATA boundaries is the result of explicit  2!4grants of authority by Congress in the 1996 Act, and thus is not subject to section 2(b) of the  e12 2!Act.\-1X6, nZ: (ԍ LATA Modification Order, 12 FCC Rcd at 4646.\ We also find that the Commission's exclusive jurisdiction over the administration of  2!LATA boundaries is the most reasonable conclusion that can be drawn from the structured  e 2statutory scheme that Congress created in the 1996 Act..X 6, nZ( 2!ԍ In light of our decision today affirming the Bureau's conclusion in the LATA Modification Order, we deny  nZd( 2!the ACC's request for a stay of the LATA Modification Order as moot. Similarly, our affirmance of the Bureau's conclusion renders moot the ACC's assertion that the Bureau acted outside of its delegated authority.  e 2 @D15. First, the 1996 Act and the Supreme Court's conclusion in Louisiana Public Service  e 2 2!$Commission v. F.C.C.>/ 6, nZw(ԍ 476 U.S. 355 (1986).> do not support the ACC's argument that section 2(b) "preserves" to the  2!ACC the authority to define intrastate LATA boundaries once the ACC determines that U S  2!WEST has complied with the section 271 competitive checklist. The ACC misstates the issue  2!~when it argues that the Bureau's Order presents a novel question concerning the interpretation of  eb2 2!Xsection 2(b) in conjunction with sections 271(d) and 10(d). In Louisiana Public Service  eK2 2!Commission v. F.C.C., the Supreme Court ruled that to overcome the intrastate proscription of  2!section 2(b), Congress must either modify section 2(b) or grant the Commission additional  e2 2!intrastate authority.>06, nZf(ԍ Id. at 36869.> As the Bureau correctly concluded in the LATA Modification Order,  2!Congress did grant authority over LATA boundaries, whether interstate or intrastate, to the  2!Commission. Although the ACC, like all state commissions, plays a significant role in evaluating  e2 2!*a BOC's compliance with the 271 checklist,P1( 6, nZ!(ԍ See 47 U.S.C.  271(d)(2)(B).P the ACC argument that this role extends to the  2!Rmodification of LATA boundaries is incorrect. Congress vested exclusive jurisdiction over LATA boundaries in the Commission. " 10*%%ZZ."Ԍ e2 @16. As the Bureau correctly found, LATAs were part of a consent decree, the MFJ,  2!approved by a federal court in the context of a federal antitrust suit. Under the MFJ, the states  2!had no jurisdiction over the creation or administration of LATA boundaries. The Bureau also  2!"correctly concluded that Congress, in the 1996 Act, explicitly granted authority to the  2!Commission to approve the establishment or modification of LATA boundaries, both intrastate  2!and interstate. In section 601, Congress directed that "any conduct or activity" previously subject  2!to the AT&T Consent Decree was now subject to the "restrictions and obligations" of the Act,  e_2 2!as amended.@2_6, nZ(ԍ 47 U.S.C.  152 nt.@ In section 3(25)(b), Congress explicitly included LATAs as one such "conduct or  2!activity" subject to the "restrictions and obligations of the Act" by defining a LATA as a  e12 2!jgeographic area "approved by the Commission."D31X6, nZ: (ԍ Id.  153(25)(b).D The Act's explicit grant of jurisdiction to the Commission to approve any change to a LATA boundary could not be more clear.  e 2 d V17. ` ` Further, the Bureau correctly concluded that exclusive Commission authority to  2!approve any changes to LATA boundaries is consistent with the 1996 Act overall. In section  2!251(g), Congress delegated to the Commission sole authority to administer the "equal access and  2!nondiscriminatory interconnection restrictions and obligations" that applied under the AT&T  e2 2!|Consent Decree.@46, nZ)(ԍ Id.  251(g).@ Further, in section 271, Congress granted exclusive authority to the  ey2 2!Commission to approve interLATA service by BOCs.I5yx6, nZ(ԍ Id.  271.I Pursuant to section 10(d) of the Act,?6y6, nZ2(ԍ Id.  10(d).?  2!`the Commission must exercise this authority by determining that the requirements of section 271  2!are fully implemented before the Commission may forbear from applying any of the requirements  e42 2!of section 271. Notwithstanding U S WEST's arguments,F746, nZ}(ԍ U S WEST Opposition at 911.F it would be inconsistent with  2!$Congress's grant of sole authority to the Commission to administer the equal access regime and  2!Rsection 271 to interpret the 1996 Act as allowing any other entity the authority to redefine or  2!eliminate LATA boundaries. Congress has thus clearly granted the Commission additional  2!authority to approve modifications of LATA boundaries, whether interstate or intrastate, thus  e2belying any argument that section 2(b) grants any authority over LATA boundaries to the states. 8 ( 6, nZ"( 2!ԍ Our conclusion is not changed by U S WEST's recent argument in its opposition to the AT&T Motion. See  2!U S WEST Opposition at 79. The cases cited by U S WEST are inapposite, and actually support our conclusion  nZ*$( 2!that exclusive Commission jurisdiction over LATA boundaries is consistent with section 2(b). In both People of  nZ$( 2!@State of Cal. v. F.C.C., 905 F.2d 1217 (9th Cir. 1990), and National Ass'n of Regulatory Utility Com'r v. F.C.C., 880"$70*%%$"  2!F.2d 422 (D.C. Cir. 1989), the issue was whether section 2(b) precluded the Commission from preempting state  nZX( 2!`regulation where the states arguably had some initial authority. As the Bureau correctly concluded in the LATA  nZ ( 2!Modification Order, the states have never had any authority over LATA boundaries, either under the MFJ or the Act.  2!Thus, exclusive Commission authority over intrastate LATA boundaries does not operate as a preemption of state authority and section 2(b) does not apply.  @ Even if these cases had some applicability, however, both support the Commission's exclusive jurisdiction  nZ( 2!over intrastate LATA boundaries. In both California v. F.C.C. and NARUC v. F.C.C., the courts supported the FCC's  nZ( 2!ability to preempt state regulation where the state regulation negates a valid federal policy. See California, 905 F.2d  nZ( 2!Fat 124344, and NARUC v. F.C.C., 880 F.2d at 42930. Such a valid federal policy exists in the 1996 amendments  nZ` (to the Act. As the Bureau correctly concluded in the LATA Modification Order,  @>XSection 271 of the Act creates a structured statutory scheme for the entry of the BOCs into the interLATA  @market and sets strict requirements that must be met before a BOC may enter into that market. Central to  @these Section 271 requirements is that the Commission not the states approve BOC entry into the interLATA market after the Commission consults with state commissions and the Department of Justice. (#  nZ( 2!LATA Modification Order, 12 FCC Rcd at 4751. It would be entirely inconsistent with this structured statutory  2!scheme for BOCs to be allowed to circumvent the 271 process by providing de facto interLATA service after a state commission had modified, or eliminated, intrastate LATA boundaries. " 080*%%ZZD"Ԍ e2 d Zԙ18. ` ` U S WEST's recent argument that Commission jurisdiction over LATA boundaries  2!in section 3(25) is not exclusive and that nothing precludes state commissions from altering in e2 2!state LATA boundaries does not alter our conclusion.D906, nZ(ԍ U S WEST Opposition at 10.D As we discuss above, historically,  2!fLATAs are a purely federal construct, over which the states had no authority. Following the  2!enactment of the 1996 Act, jurisdiction over LATAs was transferred to the Commission in  2!section 3(25), which establishes a statutory formula by which LATA boundaries are to be  2!jdefined. The section states that a LATA is (A) that which was established before the enactment  2!of the 1996 Act, or (B) that which is established or modified by a BOC after the enactment of  2!8the 1996 Act and approved by the Commission. Thus LATAs are what the MFJ court said they  2!were or what the Commission approves. The Act does not provide for any state jurisdiction over  2!LATAs whatsoever. U S WEST argues, however, that section 3(25) somehow allocates some  2!4jurisdiction over LATA boundaries to the states because the section is silent regarding state  2!commission authority to modify LATA boundaries. According to U S WEST, because section  2!3(25) does not explicitly prohibit a state from modifying an intrastate LATA boundary, the Act  2!implicitly allows a state to do so. As we discuss in the previous paragraph, the argument that  2!jurisdiction over LATA boundary administration is "shared" by the states is inconsistent with  2!section 3(25) and the exclusive authority that Congress intended that the Commission exercise  ey2 2!\over the section 271 process. Further, as the Supreme Court recently held in AT&T Corp. v.  eb2 2!Iowa Utilities Bd.,h:b6, nZ$(ԍ AT&T Corp. v. Iowa Utilities Bd., 119 S. Ct. 721 (1999).h the 1996 Act's silence regarding state jurisdiction, rather than implicitly"b P:0*%%ZZ"  e2 2!allocating jurisdiction to the states, assures that Commission jurisdiction is not superseded,;;6, nZy(ԍ Id. at 733.; and  e2 2!that FCC jurisdiction "always follows where the Act applies.";<X6, nZ(ԍ Id. at 731.; Thus, as the Bureau correctly  2!zconcluded, and as we affirm today, in the 1996 Act, Congress transferred sole authority over  e2LATA boundaries to the Commission.b=6, nZT(ԍ See 47 U.S.C.  601(a), 153(25)(b), 251(g).b  e2 @19. We also affirm the Bureau's conclusion that the Commission, in the Local  ev2 2!>Competition Second Report and Order, did not delegate its exclusive authority over LATA  2!boundaries to the states. As the Bureau correctly observed, the Commission has never explicitly  eH2 2!delegated its authority over LATA boundaries. There is no mention anywhere in the Local  e12 2!.Competition Second Report and Order of any delegation of Commission authority over LATA  2!boundaries to the states. Further, the Bureau correctly concluded that section 10(d) of the Act  2!precludes the possibility that there was an implicit delegation of Commission authority. We note  e 2 2!initially that we do not agree with the Bureau's conclusion in dicta that delegation of the FCC's  e 2 2!exclusive authority over LATA boundaries would automatically violate section 10(d).@> x6, nZ(ԍ Id.  160(d).@ The  2!section 10(d) mandate that the Commission determine that the requirements of section 271 be  2!fully implemented is not so rigid that any delegation by the Commission of its exclusive authority  e2 2!over LATA boundaries would be a per se violation of section 10(d). Nonetheless, the Bureau  2!4is correct that the Commission would not have implicitly delegated its authority because the  2!HCommission would have had to take steps to ensure that such a delegation would not violate  2!lsection 10(d). In order to make this determination, the Commission would have solicited  e42 2!comment on the issue, or at a minimum, discussed the issue in detail in the Local Competition  e2 2!HSecond Report and Order. No such solicitation or discussion took place. Thus, the Bureau  e2 2!.correctly concluded that the Commission, in the Local Competition Second Report and Order, neither explicitly nor implicitly, delegated its authority over LATA boundaries to the states.  e2 @20. The Bureau thus correctly rejected the argument presented by ACC and U S WEST  2!that Commission jurisdiction over LATA boundaries is limited by section 2(b), and that the  2!Commission delegated its authority over LATA boundaries to the states. As the Bureau found,  2!Congress vested exclusive authority to define LATA boundaries with the FCC, and the  ee2 2!`Commission in the Local Competition Second Report and Order did not delegate this authority  2!to the states. The ACC Application is thus denied because it fails to meet the requirements for review of an order issued under delegated authority. "  >0*%%ZZ "Ԍ e2 v IV. U S WEST'S PETITION FOR  e2 bRECONSIDERATION OR CLARIFICATION ă  e2X A. Background (#  e2 d 21. ` ` In paragraph 23 of the LATA Modification Order, the Bureau concludedv that the  2!pCommission, by allowing state commissions to implement dialing parity on the basis of state  2!~boundaries, had delegated no authority over LATA boundaries to the states. Instead, the Bureau  2!\reasoned, the Commission was anticipating that the significance of LATA boundaries would  2!decrease once the BOCs complied with the Section 271 checklist, began to offer inregion  2!interLATA service, and eventually no longer needed to comply with the Section 272 requirement  e 2that they provide interLATA service through a separate affiliate.'?  6, nZ| ( 2!ԍ LATA Modification Order, 12 FCC Rcd at 4750. Section 272(a) of the Act, 47 U.S.C.  272(a), requires that  2!a BOC, once it is authorized to provide interLATA service, must provide that service through a separate affiliate.  2!2Section 272(f) of the Act, 47 U.S.C.  272(f), provides that the separate affiliate requirement for BOC interLATA service shall sunset after three years, unless the Commission extends the three year period by rule or order.' The Bureau then stated  e 2 @XAt that time, as the Commission explained in paragraph 37 of the Second Report and  e 2 @Order, the states would have the flexibility to implement inregion dialing parity on the  @basis of state or LATA boundaries after taking into account the current relevance of  e2LATA boundaries.\@6, nZ(ԍ LATA Modification Order, 12 FCC Rcd at 4750.\(#  eb2 d 22. ` ` In its petition, U S WEST asks whether the Bureau, by stating in paragraph 23 of  eK2 2!the LATA Modification Order, that states would have the flexibility to implement toll dialing  2!tparity on the basis of state boundaries "at that time," was referring to the expiration of the three 2!Lyear period during which section 272 of the Act requires BOCs to provide interLATA services  2!through a separate affiliate, and had concluded that the Commission had tolled a state's ability  e2 2!to implement dialing parity on the basis of state boundaries until then.IA@6, nZ(ԍ U S WEST Petition at 45 and 7.I U S WEST argues that  2!tolling a state's authority to implement intrastate dialing parity until after those three years would  2!impair that state's ability to implement policies that affect intrastate services and are  e2 2!*procompetitive and in the public interest.9B6, nZ+!(ԍ Id. at 6.9 CPI, MDPS, AT&T, MCI, TCG, and TRA filed comments in response to the U S WEST petition. "| ` B0*%%ZZ"Ԍ e2 d P23. ` ` Even though intraLATA toll dialing parity has been implemented nationwide, C 6, nZy( 2!ԍ See Implementation of the Local Competition Provisions of the Telecommunications Act of 1996, and Petition  2!$of Southwestern Bell Telephone Company, Pacific Bell, and Nevada Bell for Expedited Declaratory Ruling on  nZ ( 2!xInterstate IntraLATA Toll Dialing Parity or, in the Alternative, Various Other Relief, Order, CC Docket No. 9698,  nZ(NSD File No. L98121, FCC 9954 (rel. March 23, 1999) (March 23 Order).  the  2!U S WEST Petition does not present a moot issue. States that currently administer intraLATA  2!toll dialing parity on a LATAbyLATA basis may wish to move to a statewide toll dialing parity  2!structure in the future. In a state that has implemented toll dialing parity on a LATAbyLATA  2!basis, customers are able to choose the carrier they wish to carry toll calls within each LATA  2!in the state in the same way they now choose an interLATA carrier. If a state were to implement  2!toll dialing parity on the basis of state boundaries, the state would discard the  2!intraLATA/interLATA dichotomy in favor of an intrastate/interstate dichotomy, and customers would make one choice for a toll provider (both intraLATA and interLATA) within the state.  e 2 d 24. ` ` The significance of U S WEST's concern is that if a state implements toll dialing  2!parity on a statewide basis, a BOC may only offer full toll service within that state after it has  2!(been granted authority under section 271 to provide interLATA service, a service that section 272  2!of the Act requires the BOC to supply through a separate affiliate for three years. If the  2!Commission has tolled a state's authority to implement statewide dialing parity until the end of  e 2 2!Lthat threeyear period, the BOC could not offer statewide toll services during that time.gDX 6, nZ( 2!Lԍ As we discuss below, whether or not a state decides to implement toll dialing parity on a LATAbyLATA  2!or statewide basis, LATA boundaries will remain in place until a BOC has successfully sought a modification of those boundaries under section 3(25) of the Act. 47 U.S.C.  3(25).g Thus,  2!if a state were to implement toll dialing parity on the basis of LATA boundaries, BOC customers  ey2 2!would choose from among at least two providers of intraLATA "1+" toll service.KEy6, nZ(ԍ See id.  153(15).K Because the  2!state had implemented toll dialing parity on a LATAbyLATA basis, none of these toll calls  2!would cross LATA boundaries. As a result, either the BOC or the BOC's interLATA affiliate  2!(if the BOC had been granted interLATA authority pursuant to section 271) could be one of the  2!providers from which the customer could choose. If, on the other hand, a state were to  2!implement toll dialing parity on the basis of state borders (an event that has yet to occur), then  2!customers could choose to have all their "1+" intrastate toll traffic automatically routed to the  2!~carrier of the customer's choice. If the BOC had not been granted section 271 authority, it could  2!znot be one of those choices because it could not supply intrastate toll traffic that would cross  2!~LATA boundaries. If the BOC had been granted authority under section 271 to offer interLATA  2!service, however, the BOC's interLATA affiliate could carry intrastate interLATA toll traffic and thus be a presubscription choice during the threeyear section 272 period. "e ` E0*%%ZZd"Ԍ e2X B. Discussion (#  e2 @25. For the reasons stated below, we deny the U S WEST petition. As CPI and MDPS  e2 2!correctly observe,CF6, nZ4(ԍ CPI/MDPS Comments at 23.C a state may implement toll dialing parityGX6, nZ( 2!ԍ As we indicate in note 25, supra, our use of the term "dialing parity" does not refer to service provision, but rather refers to the term as it is defined in section 3(15) of the Act. based on either LATA boundaries  2!or state boundaries, whichever it determines to be both procompetitive and in the public interest.  e2 2!pThere is no language in either the Local Competition Second Report and Order or the LATA  ev2 2!`Modification Order that tolls a state's authority to implement dialing parity on the basis of state borders until the sunset of the separate affiliate requirement of section 272 of the Act.  e12 @D26. U S WEST's concern that the Commission tolled state authority to implement dialing  2!lparity on the basis of state boundaries is based on a misinterpretation of the discussion in  e 2 2!paragraph 23 of the LATA Modification Order. The phrase, "at that time," in the LATA  2!Modification Order does not limit a state's ability to implement dialing parity. It merely refers  2!to the time when a state would most likely take advantage of the flexibility that it has to  e 2 2!implement toll dialing parity on the basis of state boundaries. Further, the Local Competition  e 2 2!>Second Report and Order does not require a state to delay implementation of statewide toll  2!dialing parity until the end of the threeyear separate affiliate period, but rather assumes that a  2!state may implement statewide toll dialing parity during the section 272 period. The Commission  2!included the section 272 separate affiliate requirement as one of the factors that "states should  2!be able to take . . . into account, where applicable, and have the flexibility to require that toll  e42 2!dialing parity implementation be based on state boundaries . . . ."xH46, nZ(ԍ Local Competition Second Report and Order, 11 FCC Rcd at 19414,  37.x States can only "take into  2!account" the relevance of the section 272 separate affiliate requirements for the period during  e2 2!which the requirements apply to a particular BOC. Thus, it is implicit in the Local Competition  e2 2!Second Report and Order that states may implement toll dialing parity based on state boundaries while the section 272 separate affiliate requirements apply to a particular BOC.  e2 d 27. ` ` We also agree with CPI and MDPS that we should dispel any potential ambiguities  2!regarding Commission authority by reaffirming our exclusive authority to modify LATA  2! boundaries, our jurisdiction over the section 271 application process, and by affirming that BOCs  2!must abide by the section 272 separate affiliate requirement no matter which way a state may  eN2implement toll dialing parity.CIN@6, nZ?#(ԍ CPI/MDPS Comments at 58.C "7I0*%%ZZ&"Ԍ e2 d 28. ` ` As the Bureau observed in the LATA Modification Order, the Commission, in the  e2 2!Local Competition Second Report and Order allowed the states to implement toll dialing parity  2!.on the basis of state boundaries, but explicitly recognized the continuing significance of current  2!LATA boundaries should states decide to implement dialing parity on the basis of state borders.  e2Paragraph five of the Local Competition Second Report and Order states in relevant part:  @X[t]he toll dialing parity requirement we adopt is defined by LATA boundaries given that  @the Bell Operating Companies' (BOCs') operations are likely to be shaped by LATA  @boundary restrictions for a period of unforeseeable duration. Given that implementation  e12 @of the 1996 Act over time may diminish the significance of LATA boundaries, however,  e 2 @we permit states to redefine the toll dialing parity requirement based on state, rather than  @TLATA, boundaries where a state deems such a requirement to be procompetitive and  e 2otherwise in the public interest.J 6, nZe (ԍ Local Competition Second Report and Order, 11 FCC Rcd at 19400,  5 (emphasis added).(#  e 2 d 29. ` ` Thus, although a state is free to implement dialing parity based on state borders,  e 2 2!until a LATA modification is approved by the Commission pursuant to section 3(25) of the Act,LK X6, nZ(ԍ See 47 U.S.C.  3(25)(B).L  2!LATA boundaries would continue to remain in place. As we discuss above, this would affect  2!the manner in which a BOC would be able to provide toll dialing parity. Whether, and under  2!what circumstances, either of the scenarios discussed in paragraph 23 would be "procompetitive  2!and in the public interest" is for each state, in the first instance, to decide. As the Commission  e42 2!stated in the Local Competition Second Report and Order, because of variations that exist among  2!LATA boundaries and toll traffic within, and among, the various states, each state should have  2!the opportunity to determine whether customers should be able to presubscribe to carriers for  2!jintrastate toll service and for interstate toll service in lieu of the intraLATA and interLATA toll  e2presubscription dichotomy.oL6, nZq(ԍ Local Competition Second Report and Order, 11 FCC Rcd at 19414.o  e2 d 30. ` ` Further, as the Bureau correctly held in the LATA Modification Order, states'  2!discretion to implement toll dialing parity on the basis of state boundaries is not a grant of  2!Lauthority to the states to authorize a BOC to provide intrastate interLATA service. Section 271  2!of the Act grants that authority solely to the Commission. Finally, notwithstanding the manner  2!$in which a state chooses to implement toll dialing parity, each BOC is required to comply with  2!the separate affiliate requirements of section 272 before the BOC may be granted inregion interLATA authority under section 271. " xL0*%%ZZ"Ԍ e2 @ 31. Because the Local Competition Second Report and Order and the LATA Modification  e2 2!Order do not prohibit state commissions from exercising their authority to implement toll dialing  2!parity on the basis of state boundaries until after sunset of the threeyear section 272 separate  e2subsidiary requirement, we reject the AT&T, MCI, TCG, and TRA arguments to the contrary.;M6, nZ4( 2!ԍ See, e.g., MCI Comments at 34 (the only way that a state can ensure that implementing dialing parity based  2!~on state boundaries is in the public interest is to refrain from doing so until after sunset of the separate affiliate  2!requirement); TCG Comments at 3 (U S WEST's requested clarification would permit states to ignore LATA  2!boundaries); TRA Comments at 2 (U S WEST's clarification would abrogate the section 272 separate affiliate requirements).;  e2 V. CONCLUSION ă  e_2 @32. The Commission possesses exclusive authority to approve all LATA boundary  2!modifications, whether interstate or intrastate, and the Commission has not, explicitly or  e12 2!$implicitly, delegated that authority to the states. Neither the LATA Modification Order nor any  e 2 2!.aspect of the Local Competition Second Report and Order limits the time during which a state  2!may implement toll dialing parity on the basis of state or LATA boundaries. During the three 2!year section 272 separate affiliate period, states may implement toll dialing parity based on state  2!boundaries. Absent a LATA boundary modification approved by this Commission, however,  2!LATA boundaries will remain in effect in any state that so implements dialing parity. Finally,  2!a BOC must comply with the separate affiliate provisions of section 272 no matter how a state  2!implements toll dialing parity. We therefore deny ACC's application for review or stay and deny U S WEST's petition for reconsideration or clarification.  eK2 VI. ORDERING CLAUSES ă  e2 @, 33. Accordingly, IT IS ORDERED, pursuant to sections 1.115(g) and 1.106(j) of the  2!nCommission's rules, 47 C.F.R.  1.115(g), 1.106(j), respectively, that the Application for Review  2!filed by Arizona Corporation Commission IS DENIED and the Petition for Reconsideration or Clarification filed by U S WEST IS DENIED. ` `  MhhFEDERAL COMMUNICATIONS COMMISSION ` `  Mhh ` `  MhhMagalie Roman Salas ` `  MhhSecretary"xM0*%%ZZt"  e2 APPENDIX A ă  e2Parties Filing Comments on ACC's Application for Review AT&T Corporation (AT&T) The Competition Policy Institute and Minnesota Department of Public Service (CPI and MDPS) The Telecommunications Resellers Association (TRA) Teleport Communications Group Inc. (TCG)  e 2Parties Filing Comments on U S WEST's Petition for Reconsideration or Clarification AT&T Corporation (AT&T) The Competition Policy Institute and Minnesota Department of Public Service (CPI and MDPS) MCI Telecommunications Corporation (MCI) The Telecommunications Resellers Association (TRA) Teleport Communications Group Inc. (TCG)