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Before the
Federal Communications Commission
Washington, D.C. 20554
In the Matter of )
)
Teleport Communications )
Atlanta, Inc. )
Complainant, )
) File No. PA 00-005
v. )
)
Georgia Power Company, )
Respondent )
)
Application for Review
ORDER ON REVIEW
Adopted: September 27, 2002
Released: October 8, 2002
By the Commission:
I. INTRODUCTION
1. In this Order, we deny an application for review
("Application") of a Cable Services Bureau ("Bureau") Order,
DA 01-2653 ("Bureau Order"),1 released under delegated
authority. The Bureau Order granted a pole attachment
complaint filed by Teleport Communications Atlanta, Inc.
("Teleport") against Georgia Power Company ("GPC") pursuant
to Section 224 of the Communications Act of 1934, as amended
("Pole Attachment Act")2 and Subpart J of Part 1 of the
Commission's rules.3 The Bureau found GPC's annual pole
attachment rate of $53.35 to be unjust and unreasonable
pursuant to the Pole Attachment Act and calculated a just
and reasonable annual pole attachment rate. We affirm the
Bureau Order.
II. BACKGROUND
2. Pursuant to the Pole Attachment Act, the
Commission has the authority to regulate the rates, terms,
and conditions for attachments by a cable television system
or provider of telecommunications service to a pole, duct,
conduit, or right-of-way owned or controlled by a utility.4
The Pole Attachment Act grants the Commission general
authority to regulate such rates, terms and conditions,
except where such matters are regulated by a State.5 The
Commission is authorized to adopt procedures necessary to
resolve complaints concerning such rates, terms, and
conditions.6 A utility may not charge more than the maximum
amount permitted by the formula developed by the Commission
to ensure that rates are just and reasonable. We have
concluded that "where onerous terms or conditions are found
to exist on the basis of the evidence, a cable company may
be entitled to a rate adjustment or the term or condition
may be invalidated."7
3. The Commission developed a formula, known as the
Cable Formula, to be used in resolving complaints by cable
systems concerning pole attachment rates.8 The
Telecommunications Act of 1996 ("1996 Act")9 directed the
Commission to prescribe similar regulations for attachments
by telecommunications carriers.10 Pending the
implementation of those regulations, the Commission was
directed to apply the Cable Formula to rates for pole
attachments made by telecommunications carriers.11 The
Commission adopted a Telecommunications Formula ("Telecom
Formula") that became effective February 8, 2001, with any
increases in rates as compared to the Cable Formula to be
phased in over five years.12 The two formulas differ in only
one respect, namely their methodologies for determining the
proportion of unusable space on a pole that is attributable
to the attachment. Our Cable Formula attributes unusable
space to an attachment based on the portion of usable space
occupied by the attachment, while our Telecom Formula
attributes unusable space to a telecommunications attachment
based on the total number of attaching entities.13 The
total space occupied by an attacher, both usable and
unusable, is referred to as the Space Factor in our
formulas.14
4. The attachments at issue in this case are for
telecommunications services. The Cable Formula applies to
the attachments until February 8, 2001, after which one-
fifth of the differential between the Cable Formula rate and
the Telecom Formula rate is to be phased in annually for
five years.
III. BUREAU ORDER
5. In granting Teleport's complaint, the Bureau
rejected a proposal by GPC to use an alternative methodology
for calculating pole attachment rates.15 The Bureau also
denied GPC's request to provide supplemental material in
support of the alternative methodology because, among other
reasons, the Commission had already rejected that
methodology.16 The Bureau found that GPC provided no
compelling reason why the Commission's procedural rules
should be waived to allow an additional filing that
contained no new arguments or evidence specific to the
present dispute. Because GPC had the opportunity to raise
the issues addressed in its supplemental filing in the
rulemaking process, and the specific issues were raised and
addressed previously by the Commission, the Bureau found
that there was not good cause to re-examine those issues in
this case.
6. The Bureau Order also rejected GPC's argument that
our existing formula does not provide just compensation as
required by the Fifth Amendment to the United States
Constitution.17 The Bureau based its decision on the
Commission's reasoning in Alabama Cable v. Alabama Power
("Alabama Power")18 in which the Commission concluded that
the pole attachment formulas, together with the payment of
make-ready expenses, provide compensation that exceeds just
compensation. Because the pole attachment complaint
procedures are intended to ensure a simple and expeditious
process for resolving complaints,19 the Bureau also rejected
GPC's request for an evidentiary hearing, concluding that
the record in this matter contains sufficient information to
determine a just and reasonable pole attachment rate.
7. Finally, the Bureau rejected GPC's specific rate
calculations because GPC failed to support its deviations
from the Cable and Telecom Formulas. For example, GPC
asserted that the average number of attaching entities to be
used in calculating the Space Factor for its alternative
formula is 1.5922 per pole. The Bureau rejected that number
for use in its calculation of the maximum just and
reasonable rate using the Telecom Formula because the
Commission has concluded that the minimum possible number of
attachers to be used in the Telecom Formula is two.20 The
Bureau substituted a presumptive average number of attaching
entities, three for non-urbanized (less than 50,000
population) areas and five for urbanized (more than 50,000
population) areas,21 in its calculation of the Telecom
Formula and provided a pole attachment rate for either
situation. The Bureau calculated a maximum just and
reasonable annual rate of $6.56 per pole attachment up to
February 8, 2001, and, beginning February 8, 2001, a first
year rate of $7.23 for areas with an average of five
attachers, and a first year rate of $8.24 for areas with an
average of three attachers. The Bureau concluded that GPC's
pole attachment rate of $53.35 is not just and reasonable.
IV. APPLICATION FOR REVIEW
8. In its Application, GPC argues that the Bureau
mishandled this case procedurally because the parties were
not required to engage in additional negotiations before the
Bureau resolved the Complaint, because GPC was not allowed
to supplement its pleadings with additional material, and
because an evidentiary hearing was not conducted. GPC also
argues that the Commission should use this opportunity to
reverse its decision in Alabama Power because that decision
inhibits the deployment of broadband technology and violates
GPC's constitutional right to just compensation. GPC further
argues that the Bureau improperly used presumptions outlined
in the Consolidated Order22 that were incorrect, and applied
those presumptions retroactively.
9. In its Opposition, Teleport asserts that GPC not
only had the opportunity but the duty to provide, in
response to the complaint, sufficient evidence to support
its pole attachment rate increase. Teleport argues that GPC
failed to engage in good faith negotiations, choosing
instead to enact a unilateral rate increase. Teleport
asserts that GPC was not denied due process by the
Commission's established pleading cycle and therefore was
not entitled to an evidentiary hearing. Teleport argues
that GPC improperly disregarded the Commission's formulas in
calculating its pole rental rates, ignoring the Commission's
explicit rulings and including FERC accounts23 that the
Commission previously excluded. Teleport asserts that GPC
offers no new arguments to support its claim that the Bureau
erred in terminating the $53.35 rate.
10. In its Reply, GPC asserts that it will illustrate
the Bureau's numerous errors in computing the maximum just
and reasonable pole attachment rate by providing an
explanation of its use of 1.5922 as the average number of
attachers in its proposed formula. GPC claims that its
calculation was made in a manner that is consistent with the
Consolidated Order, and that the Bureau had no legal basis
to reject its calculation and impose presumptive numbers.
GPC also reiterates its argument in favor of an alternative
formula to calculate pole attachment rates.
11. Teleport filed a motion to strike GPC's reply and
its attached exhibits because they violate Section 1.115(c)
of the Commission's rules,24 which states that no
application for review will be granted if the application
relies on questions of fact or law upon which the designated
authority has been afforded no opportunity to pass.
Teleport asserts that the data and calculations accompanying
GPC's reply were never submitted to the Bureau. In
opposition, GPC argues that the issue of average number of
attachers was addressed below and it should be allowed to
provide the underlying data in support of its original
calculation. Moreover, GPC asserts that the Bureau should
have requested that GPC provide this data before rejecting
GPC's 1.5922 calculation. Finally, GPC argues that it is in
the public interest to include the additional new data
because it provides a useful and informative case study for
calculating an average number of attachers.
V. DISCUSSION
12. A review of the record reveals that GPC did not
make any effort to justify its pole attachment rate using
either the Cable Formula, in effect prior to February 8,
2001, or the Telecom Formula, in effect beginning February
8, 2001, in response to the complaint. Instead, GPC
substituted its own formula for calculating pole attachment
rates.25 When the Bureau reviewed GPC's filing, it concluded
that GPC had not met its burden to calculate a just and
reasonable rate using the formulas as promulgated by our
orders.
13. In the Consolidated Order, the Commission resolved
a number of petitions for reconsideration of our two most
recent rulemakings concerning pole attachment regulation,
the Telecom Order26 and the Fee Order.27 GPC argues that
the Bureau should have required GPC to update its response
following the release of the Consolidated Order in May 2001.
In fact, the Bureau released an order on June 1, 2001,28
which specifically gave notice to GPC of the Consolidated
Order and provided GPC with guidance on the type of
supplemental material that would be considered by the Bureau
in its review of a complaint. GPC had ample opportunity to
update its filing prior to the release of the Bureau Order
on November 14, 2001. Our rules state with particularity
the information a utility must provide an attacher in order
for the attacher to calculate a just and reasonable rate.
GPC however, never provided, in addition to its own formula
calculation, the information necessary for the Commission to
calculate a maximum just and reasonable rate using the
Commission's formulas.29 GPC chose not to file supplemental
material in response to the Bureau's June 1, 2001 order.
Instead, GPC insisted that it should be allowed to reargue
the issues raised and rejected by the Commission in the
Consolidated Order and Alabama Power.30
14. Both Commission formulas include a Space Factor,
which is used to calculate the portion of capital and
operating costs attributable to the attaching party.31 In
the Telecom Order, we identified a methodology for
determining the average number of attaching entities, an
element of the Space Factor used in the Telecom Formula.
Specifically, pursuant to the Telecom Order, for pole
attachment rates for telecommunications providers beginning
February 8, 2001, GPC was under an obligation to provide, as
part of the Space Factor calculation using the Commission's
Telecom Formula, a "presumptive average number of attaching
entities . . . reflecting where the service is being
provided . . .[with] a range of presumptive averages
depending on rural, urban, or urbanized areas . . ."32 Even
before the Consolidated Order was released, in which we
reconsidered and clarified the methodology identified in the
Telecom Order for determining the average number of
attaching entities, GPC was obligated to include itself in
this average number.33
15. In addition, GPC was required to "upon request,
provide all attaching entities and all entities seeking
access the methodology and information by which [the]
presumption was determined."34 Once the complaint was
filed, GPC was under an obligation to provide this
documentation in support of its rate calculation.35 The
sole explanation provided by GPC in support of the 1.5922
figure, which represented the average number of attaching
entities in its proposed alternative formula, was as
follows: "Avg. # of Attachments (no. of poles with cable
attach. & no. of poles with telecom attach. divided by total
no. of poles with both cable and telecom attach.)."36 This
explanation articulates a number that reflects only the
ratio of the number of poles with either a cable or
telecommunications attachment to the number of poles with
both types of attachments. It is meaningless for the
purpose of supporting an average number of attaching
entities per pole. Thus, GPC did not meet its initial
burden to provide the methodology and information by which
its presumption was determined.
16. The Telecom Order also provided that "[c]hallenges
to the presumptive average number of attaching entities by
the telecommunications carrier or cable operator may be made
in the same manner as challenges presently are undertaken.
The challenging party will initially be required to identify
and calculate the number of attachments on the poles and
submit to the utility what it believes to be an appropriate
average. Where the number of poles is large, and complete
inspection impractical, a statistically sound survey should
be submitted. The pole owner will be afforded an opportunity
to justify the presumption. Where a presumption is
successfully challenged, the resulting figure will be deemed
to be the number of attaching entities."37 Teleport
identified three and five as the average number of attachers
when it filed its complaint. GPC had the opportunity to
refute Teleport's proposed figures in its response to the
complaint, but did not provide any information to do so.
Instead, GPC proposed a different formula entirely which in
fact included a component that might be considered to be
analogous to the average number of attaching entities
component used in the Telecom Formula. As noted above,
however, GPC provided no meaningful explanation of its
alternative calculation.
17. Even though GPC did not include a justification of
its post February 8, 2001 pole attachment rate using the
Commission's Telecom Formula, the Bureau examined the
material provided by GPC to determine if any of the
information would be useful in calculating the maximum rate
permissible under the Pole Attachment Act. The Bureau
rejected GPC's average number of attachments figure of
1.5922 because the minimum possible number of attachers to
be used in the Telecom Formula is two.38 Although the Bureau
cited the Consolidated Order in support of its conclusion,
the same result was mandated by the Telecom Order, because,
as we noted above, GPC was required to include itself in the
count. In addition, the Bureau could have rejected the
1.5922 figure because GPC provided no reasonable explanation
or supporting documentation to substantiate the number.
Also, the Bureau could have rejected GPC's number outright
because GPC did not even proffer the number to be used as
the average number of attaching entities in the Telecom
Formula.
18. In the Consolidated Order, in order to expedite
the process of developing average numbers of attaching
entities, and allow utilities to avert the expense of
developing location specific averages, we provided two
rebuttable presumptive averages for use in our Telecom
Formula.39 Thus, utilities have the option of not
conducting a potentially costly and burdensome exercise
necessary to develop averages based on their company
specific records. We concluded that, as with all our
presumptions, either party may rebut this presumption with a
statistically valid survey or actual data. In other words,
a utility can rebut the presumptions by providing the same
information it was obligated to provide under the Telecom
Order in support of its own average number of attaching
entities. The only difference is that now, the utility has
the option of declining to rebut the presumptions.
19. After rejecting GPC's 1.5922 figure as the average
number of attaching entities to be used in the Telecom
Formula calculation, the Bureau substituted presumptions of
three and five, in accordance with the Consolidated Order.
As noted above, these presumptions were also the same
numbers proffered by Teleport in its formula calculations.
GPC objects to the use of the presumptions because they were
identified by the Commission in the Consolidated Order. As
we stated above, had it chosen to do so, GPC had ample
opportunity to supplement its response to the complaint in
the appropriate way following the issuance of the
Consolidated Order. Moreover, even before the Consolidated
Order was released, GPC was aware that Teleport had
proffered, in its complaint, presumptions of three and five
for the average number of attaching entities. Thus, even if
the Commission had not adopted presumptions in the
Consolidated Order, the Bureau reasonably could rely on the
presumptions proffered by Teleport, particularly in the
absence of any evidence by GPC in support of a different
average number.40 Under the standard elucidated in both the
Telecom Order and the Consolidated Order, GPC completely
failed to support its proposed calculation of the average
number of attaching entities and the Bureau acted properly
when it inserted the presumptive numbers in its calculation
of the maximum permissible rate under the Pole Attachment
Act.41
20. We therefore conclude that, even in the absence of
the Consolidated Order, we would find the Bureau's decision
to be reasonable. Although the Consolidated Order, adopting
the presumptions of 3 to 5 attaching entities, was released
subsequent to the complaint being filed in this matter, we
hereby independently adopt these presumptions, based on the
fact that they were proffered by Teleport in this case and
were not refuted by GPC. We also conclude that the
rationale set forth in the Consolidated Order also applies
here. As we stated in the Consolidated Order, it is
reasonable to presume that in a non-urbanized area (less
than 50,000 population) there would be electric, telephone
and cable attachers.42 In an urbanized area (50,000 or
higher population), which is more developed commercially
than a non-urbanized area, and in which we expect both
residential and business commercial competition to flourish,
it is reasonable to presume the following possible attaching
entities: electric, telephone, cable, competitive
telecommunications service providers and governmental
agencies.43 Thus, the presumption as applied to GPC in this
adjudicatory proceeding does not constitute impermissible
retroactive application of our rules because under our
decision here, we do not rely on the Consolidated Order.44
Moreover, as discussed above, the maximum permissible rate
established by the Bureau would have been the same here even
if the case had been decided prior to the release of the
Consolidated Order. Therefore, to the extent the Bureau
relied on the Consolidated Order, it was harmless error,
particularly in light of our decision not to rely on it.
21. GPC argues that the Bureau should have required
that the parties engage in additional negotiations before it
resolved the Complaint. While we encourage all parties to
negotiate prior to seeking recourse with the Commission,45
in this case, GPC imposed a unilateral rate increase on
Teleport without negotiation and without using the
Commission's formulas as a benchmark for negotiation. GPC
admittedly based its rate on its own alternative methodology
and declined to provide supporting documentation to Teleport
upon request.46 We think it was reasonable for Teleport to
conclude that further efforts at negotiation were fruitless
in the absence of Commission intervention. Therefore, we are
not persuaded by GPC's argument that further negotiations
between the parties were required prior to a resolution of
the complaint.
22. GPC argues that it was entitled to file
supplemental pleadings and was entitled to an evidentiary
hearing. The pole attachment process is designed to be
efficient but allow all parties to fully express their
positions. The decision to allow additional filings or
request an evidentiary hearing is discretionary.47 Because
most of the information necessary to determine a just and
reasonable rate is culled from publicly filed documents,
there is seldom any need to hold an evidentiary hearing
concerning a rate calculation.48 Where information is not
available from public documents, we have established
guidelines for the parties to follow.49 The Bureau found
that the material facts available in the record in written
form, such as GPC's FERC Form 1 filings and accounting
records, were sufficient to support a decision. GPC had
ample opportunity to respond in writing to the complaint.
The Bureau was not required to hold a hearing and we find
that it did not abuse its discretion in declining to do
so.50 In addition, the Bureau found that GPC included no
factual information in its supplemental material necessary
to calculate of a just and reasonable pole attachment rate
using the Commission's existing rules and policies. Rather,
the entire supplement consisted of materials in support of
GPC's argument for an alternative methodology for
calculating pole attachment rates, a methodology that has
been rejected by the Commission.51 GPC has provided no
compelling reason why the Commission's procedural rules
should have been waived to allow an additional filing that
contained no new arguments or evidence specific to the
present dispute.
23. GPC also argues that we should abandon the rules
and policies elucidated in the Consolidated Order and
Alabama Power.52 We see no reason to revisit the issues
that were thoroughly addressed in those orders. The
Consolidated Order was the Commission's final ruling on
multiple pole attachment issues arising from the
implementation of the 1996 Act and the Commission's
experience in applying the pole attachments rules and
formulas. It was a thorough notice and comment rulemaking
proceeding and included a review of the materials and issues
raised by GPC. GPC has provided no compelling reason why
those issues should be revisited in this adjudication. In
Alabama Power, we concluded that our pole attachment
formulas, together with the payment of make-ready expenses,
provide compensation that exceeds just compensation. GPC
makes no new arguments and provides no new information that
would cause us to revisit that issue in this case.
Therefore, we reject GPC's request that we reverse those
decisions.
24. Finally, we consider GPC's reply and the
additional information contained in it. GPC asserts that is
has now included the underlying data in support of its
original calculation and that it is consistent with the
Consolidated Order. GPC argues that it is in the public
interest to include the additional new data because it
provides a useful and informative case study for calculating
average number of attachers. However, the data and
calculations accompanying GPC's reply were never submitted
to the Bureau. This is the type of information that GPC
should have provided in response to the complaint. We cannot
condone GPC's failure to provide the appropriate information
at the required time. Section 1.115(c) of the Commission's
rules states that: "[N]o application for review will be
granted if it relies on questions of fact or law upon which
the designated authority has been afforded no opportunity to
pass.53 GPC provides no adequate explanation for its
failure to provide a reasonable explanation for its average
number of attaching entities at the time it responded to the
complaint. Therefore, we will not consider the new factual
material.54
25. In any event, we note that the factual material
supplied by GPC does not comport with its original
calculation. For example, GPC submits, for the first time,
a "December 2000 Spread Sheet" that purports to support its
original calculation of 1.5922 for the average number of
attaching entities.55 Although the description of its
calculation is identical to the description submitted with
the complaint, it does not reflect GPC's actual methodology.
In essence, GPC multiplied a number of poles by the number
of attachments per pole, added the gross number of
attachments together and divided that figure by the total
number of poles included in the equation. Even if GPC had
submitted this entire explanation with its response, it
would not have been adequate to support an average number of
attaching entities because it provides no explanation of the
source for GPC's calculation. For example, an attacher is
only responsible to pay its Telecom Formula share of the
costs of unusable space for the poles to which it is
actually attached.56 Therefore, using a survey to calculate
an average number of attachers provides an efficient
solution to the problem of calculating a rate for each
individual pole to which an attacher is affixed. In order
to be a reasonable reflection of the actual poles to which
an attacher is affixed, the average must reflect only those
poles in areas where the attacher is actually affixed.57 GPC
asserts that Teleport targets only local business telephone
customers in urban areas.58 This tends to support the use
of a smaller, denser representative area to calculate the
average number of attachers. GPC provides absolutely no
explanation in support of its inclusion of poles to which
Teleport is not attached. Nor does GPC explain why the
number of poles with multiple telephone attachments is not
representative of the poles to which Teleport, a competitive
local telephone carrier, is attached.59
26. Finally, GPC provides what it describes as updated
figures in its "January 2002 Spread Sheet."60 This is GPC's
first attempt to provide even a minimal showing in support
of a presumptive average number of attaching entities. Once
again, GPC fails to provide an adequate explanation for the
source of its numbers. For example, GPC includes a number
that represents the number of "paying attachments"61 without
explaining how this number was derived. GPC admits that it
does not include itself or government attachments in its
count. And, while GPC does attempt to divide its service
areas into urban and rural, it does not indicate the
specific service areas in which Teleport is actually
attached. Indeed, there is no indication that Teleport is
included in the count of attachments. We encourage GPC to
develop a presumptive average that accurately reflects the
Teleport service area and that can be used in its future
negotiations with Teleport. As stated above, however, we
decline to accept GPC's newly filed information in support
of its Application.
VI. CONCLUSION AND ORDERING CLAUSE
27. For the reasons discussed above, we conclude that
Applicant's application for review should be denied.
28. Accordingly, IT IS ORDERED, pursuant to
Section 1.115 of the Commission's rules, 47 C.F.R. § 1.115,
that the Application for Review of Teleport Communications
Atlanta, Inc. v. Georgia Power Co., DA 01-2653, 16 FCC Rcd
20238 (2001) IS DENIED.
FEDERAL COMMUNICATIONS COMMISSION
Marlene H. Dortch
Secretary
_________________________
1 Teleport Communications Atlanta, Inc. v. Georgia Power
Company, DA 01-2653, 16 FCC Rcd 20238 (2001).
2 47 U.S.C. § 224.
3 47 C.F.R. §§ 1.1401-1.1418. GPC also filed a petition for
review of the Bureau Order with the U.S. Court of Appeals
for the 11th Circuit while its Application for Review is
pending before the Commission. See Georgia Power v. Federal
Communications Commission, No. 02-10222-B (filed January 11,
2002).
4 47 U.S.C. § 224 (b) (1).
5 47 U.S.C. § 224 (b) and (c). Georgia has not certified
that it regulates rates, terms and conditions of pole
attachments. See Public Notice, "States That Have Certified
That They Regulate Pole Attachments," 7 FCC Rcd 1498 (1992).
647 U.S.C. § 224 (b)(1). The Commission has developed a
formula methodology to determine the maximum allowable pole
attachment rate. See Adoption of Rules for the Regulation
of Cable Television Pole Attachments, First Report and
Order, 68 F.C.C. 2d 1585 (1978); Second Report and Order, 72
F.C.C. 2d 59 (1979); Memorandum and Order, 77 F.C.C. 2d 187
(1980), aff'd, Monongahela Power Co. v. FCC, 655 F.2d 1254
(D.C. Cir. 1985) (per curiam); and Amendment of Rules and
Policies Governing the Attachment of Cable Television
Hardware to Utility Poles, 2 FCC Rcd 4387 (1987). See also,
Implementation of Section 703(e) of the Telecommunications
Act of 1996, 13 FCC Rcd 6777 (1998) and Amendment of Rules
and Policies Governing Pole Attachments, 15 FCC Rcd 6453
(2000), pet. for recon. denied in part, Amendment of
Commission's Rules and Policies Governing Pole Attachments,
CS Docket No. 97-98; Implementation of Section 703(e) of the
Telecommunications Act of 1996, FCC 01-170, 16 FCC Rcd 12103
(2001), appeal pending sub nom. Southern Company Services,
Inc. et al. v. FCC, Case No. 01-1326 (D.C. Cir., filed July
26, 2001).
7Amendment of Rules and Policies Governing the Attachment of
Cable Television Hardware to Utility Poles, Memorandum Order
and Opinion on Reconsideration, 4 FCC Rcd 468, 471 at ¶ 26
(1989).
8 See 47 C.F.R. § 1.1409 (e)(1).
9 Pub. L. No. 104-104, 110 Stat. 56 (1996).
10 47 U.S.C. § 224 (e).
11 See 47 C.F.R. § 1.1409 (e)(1); 47 U.S.C. § 224 (d) (3).
12 See 47 C.F.R. § 1.1409 (e)(2), (f).
13 Id. at ¶ 53-56.
14 47 C.F.R. § 1.1409 (e).
15 Bureau Order at ¶ 11. The Bureau rejected GPC's
alternative because GPC calculated a rate of $53.35 per
pole, using replacement costs rather than historical costs
as required by the Commission. Since the inception of pole
attachment regulation in 1978, the Commission has
consistently rejected the use of replacement costs in the
formula, for a number of reasons that remain valid today.
See Amendment of Commission's Rules and Policies Governing
Pole Attachments, FCC 01-170, 16 FCC Rcd 12103 at ¶¶ 15-25
(2001), appeal pending sub nom. Southern Company Services,
Inc. et al. v. FCC, Case No. 01-1326 (D.C. Cir., filed July
26, 2001) ("the continued use of historical costs
accomplishes key objectives of assuring, to both the utility
and the attaching parties, just and reasonable rates;
establishes accountability for prior cost recoveries; and
accords with generally accepted accounting principles" Id. ¶
15); see also Alabama Cable Telecommunications Association,
et al. v. Alabama Power Company, FCC 01-181, 16 FCC Rcd
12209 at ¶¶ 32-58 (2001), appeal pending sub nom. Alabama
Power Company v. FCC, Case No. 00-14763-I (11th Cir., filed
Sept. 13, 2000) ("Because the utility's interest in the
property is not completely destroyed, requiring the use of
replacement costs as a measure of just compensation is
inappropriate." Id. ¶ 57); see also Amendment of Rules and
Policies Governing Pole Attachments, FCC 00-116, 15 FCC Rcd
6453 (2000). In addition, GPC included in its calculations
Federal Energy Regulatory Commission ("FERC") accounts which
are not approved by the Commission for inclusion in the
formula because the costs recorded in those accounts are not
sufficiently attributable to the poles. GPC used a proposed
30 percent "space allocation" factor rather than the
Commission's formula presumption of 7.4 percent for the
cable rate or maximum 24 percent for the telecom rate in the
rare circumstance of only two attachers.
16 Bureau Order at ¶ 6, citing Amendment of Commission's
Rules and Policies Governing Pole Attachments, FCC 01-170,
16 FCC Rcd 12103 (2001), appeal pending sub nom. Southern
Company Services, Inc. et al. v. FCC, Case No. 01-1326 (D.C.
Cir., filed July 26, 2001); Alabama Cable Telecommunications
Association, et al. v. Alabama Power Company, File No. PA
00-003, FCC 01-181, 16 FCC Rcd 12209 (2001), appeal pending
sub nom. Alabama Power Company v. FCC, Case No. 00-14763-I
(11th Cir., filed Sept. 13, 2000).
17 Bureau Order at ¶ 7.
18 Alabama Cable Telecommunications Association, et al. v.
Alabama Power Company, File No. PA 00-003, FCC 01-181, 16
FCC Rcd 12209 at ¶¶ 32-61 (2001), appeal pending sub nom.
Alabama Power Company v. FCC, Case No. 00-14763-I (11th
Cir., filed Sept. 13, 2000).
19 See Adoption of the Rules for the Regulation of Cable
Television Pole Attachments, 68 F.C.C. 2d 1585 at ¶ 36
(1978).
20 See Amendment of Commission's Rules and Policies
Governing Pole Attachments, FCC 01-170, 16 FCC Rcd 12103 at
¶ 60 (2001), appeal pending sub nom. Southern Company
Services, Inc. et al. v. FCC, Case No. 01-1326 (D.C. Cir.,
filed July 26, 2001).
21 Id. at ¶¶ 71-72.
22 Amendment of Rules and Policies Governing Pole
Attachments, FCC 01-170, 16 FCC Rcd 12103 (2001) ), appeal
pending sub nom. Southern Company Services, Inc. et al. v.
FCC, Case No. 01-1326 (D.C. Cir., filed July 26, 2001).
23 For electric utilities, the accounts to be used to
determine the maximum allowable rate for pole attachments
are reported on the Federal Energy Regulatory Commission
("FERC") Form 1. A description of the FERC accounts is
contained in 18 C.F.R. Part 101.
24 47 C.F.R. § 1.115(c).
25 See n.15 above.
26 Implementation of Section 703(e) of the
Telecommunications Act of 1996, 13 FCC Rcd 6777 (1998).
27 Amendment of Rules and Policies Governing Pole
Attachments, 15 FCC Rcd 6453 (2000).
28 See Teleport Communications Atlanta, Inc., v. Georgia
Power Co., DA 01-1332, 16 FCC Rcd 11831 (2001).
29 See n.15 above. See also, 47 C.F.R. § 1.1401-1.1418.
30 See n. 15 above.
31 See 47 C.F.R. § 1.1409.
32 Telecom Order at ¶ 77.
33 GPC is affiliated with a telecommunications provider.
See id. at ¶ 51. GPC admits that it has two affiliates that
provide telecommunications related services: Southern
Communications Services, Inc. d/b/a Southern LINC, a
wireless provider, and Southern Telecom, Inc., an exempt
telecommunications company that has developed fiber optic
projects for non-affiliate carriers. See Reply to
Opposition to Application at Affidavit of Thomas G. Park. If
there was any doubt about whether GPC should be counted, we
clarified in the Consolidated Order that a utility pole
owner was so obligated, whether or not it was affiliated
with a telecommunications provider. GPC continues to object
to the pole owner being included in the average number of
attaching entities under any circumstances. However, GPC
admits that on its average pole, the electric utility uses
an average 7.5 feet of usable space, whereas a cable
attacher uses one foot. See Response at Affidavit of Thomas
G. Park. Applying the policy espoused by GPC to a pole with
only two attachments, an electric utility attachment and a
cable attachment that provides telecommunications service,
the attacher would be required to pay 2/3 of the cost of
unusable space, whereas the electric utility would pay only
1/3. The inequity of this result is even more pronounced
when one considers that the electric utility pole owner is
using over seven times as much usable space on the pole.
34 Telecom Order at ¶ 78.
35 See 47 C.F.R. § 1.1404 (j) (". . . the utility shall
supply this information in response to the complaint.")
Teleport also requested this information by letter to GPC at
the same time that it filed its complaint. See Reply at
Exhibit 3.
36 See Response at Affidavit of Thomas G. Park.
37 Telecom Order at ¶ 79.
38 See Bureau Order at ¶ 11, citing the Consolidated Order
at ¶ 60.
39 Consolidated Order at ¶ 69.
40 47 C.F.R. § 1.1409 (a) ("Where one of the parties has
failed to provide information required to be provided by
these rules or requested by the Commission, or where costs,
values or amounts are disputed, the Commission may estimate
such costs, values or amounts it considers reasonable, or
may decide adversely to a party who has failed to supply
requested information which is readily available to it, or
both.").
41 This case illustrates the importance of presumptions in
maintaining a minimal and efficient rate-setting process.
Without presumptions, a responding party is more likely to
withhold the information necessary to calculate the maximum
just and reasonable rate. A party may always choose to
present probative direct evidence regarding an acceptable
alternative to a presumption in order to reflect its unique
circumstances.
42 Consolidated Order at ¶ 71.
43 Id. at ¶ 72.
44 See, e.g., Celtronix Telemetry, Inc. v. FCC, 272 F.3d 585
(D.C. Cir. 2001), rehearing and rehearing en banc denied Jan
10, 2002, petition for certiorari filed April 10, 2002,
citing Landgraf v. USI Film Products, Inc., 511 U.S. 244
(1994) and Bowen v. Georgetown University Hospital, 488 U.S.
204 (1988), Scalia, J., concurring).
45 See, for example, Telecom Order at ¶¶ 10, 16-21;
Consolidated Order at ¶ 13. See also, 47 C.F.R. § 1.1404
(k).
46 Teleport also requested the information by letter to GPC
at the same time it filed its complaint. See Reply at
Exhibit 3.
47 See 47 C.F.R. § 1.1407 (". . . no other filings . . .
will be considered unless authorized by the Commission.");
and 47 C.F.R. § 1.1411 ("The Commission may decide each
complaint upon the filings and information before it, may
require one or more informal meetings with the parties to
clarify the issues or to consider settlement of the dispute,
or may, in its discretion, order evidentiary procedures upon
any issues it finds to have been raised by the filings.").
48 See, for example, Texas Utilities Elec. Co. v. FCC, 997
F.2d 925 (D.C. Cir. 1993) (It is not necessary for the
Commission to conduct an evidentiary proceeding to determine
just and reasonable rates under the Pole Attachment Act).
49 See 47 C.F.R. §§ 1.1401-1.1418.
50 Although the Eleventh Circuit Court of Appeals held, in
Gulf Power v. United States, 187 F.3d 1324 (1999), that the
1996 Act's mandatory access amendment to the Pole Attachment
Act effected a taking of property, the Court found that
there is an adequate process for obtaining just
compensation.
51 See Amendment of Commission's Rules and Policies
Governing Pole Attachments, FCC 01-170, 16 FCC Rcd 12103
(2001), appeal pending sub nom. Southern Company Services,
Inc. et al. v. FCC, Case No. 01-1326 (D.C. Cir., filed July
26, 2001); Alabama Cable Telecommunications Association, et
al. v. Alabama Power Company, File No. PA 00-003, FCC 01-
181, 16 FCC Rcd 12209 (2001), appeal pending sub nom.
Alabama Power Company v. FCC, Case No. 00-14763-I (11th
Cir., filed Sept. 13, 2000).
52 In support of this contention, GPC asserts that "[a]
rational public policy analysis would indicate that cable
and phone customers, particularly at the high end, should be
required to pay a higher share of infrastructure costs to
lower the costs of essential services, such as electricity,
to consumers of those services." Application at pp. 6-7.
53 47 C.F.R. § 1.115 (c).
54 As the Commission has stated before, "[w]e cannot allow a
party to 'sit back and hope that a decision will be in its
favor and, when it isn't, to parry with an offer of more
evidence. No judging process in any branch of government
could operate efficiently or accurately if such a procedure
were allowed.'" See Canyon Area Residents, FCC 99-123, 14
FCC Rcd 8152 at ¶ 7 (1999), quoting Colorado Radio Corp. v.
FCC, 118 F. 2d 24, 26 (D.C. Cir. 1941).
55 See Park Reply Declaration at Exhibit 2.
56 47 U.S.C. § 224 (e)(2).
57 See Consolidated Order at ¶ 66, n. 277 ("The service area
must be representative of the area for which pole attachment
rates are being set.").
58 Application at p. 2; Park Reply Declaration at p. 5.
59 GPC's analogy to splitting a three person dinner tab five
ways is inapposite to the facts in issue. See Park Reply
Declaration at p. 7. It is relevant, however, to
highlighting the need to have the average number of
attachers reflect the number of attachers in the service
area in which the attaching party has actual attachments.
Using the same analogy as GPC, it would be unreasonable to
split a dinner tab based on the number of diners sitting at
a different table.
60 See Park Reply Declaration at Exhibit 3.
61 See Park Reply Declaration at p. 8.