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Order CRTC 2000-1098
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Ottawa, 4 December 2000
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Cochrane Public Utilities Commission - Service improvement plan
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Reference: Tariff Notice 27
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The Commission approves a financial limit of $15,000, including a customer contribution charge of $1,000, for the provision of basic service to unserved customers in Cochrane's territory, effective 1 January 2001.
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1.
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In Telephone service to high-cost serving areas, Telecom Decision CRTC 99-16, dated 19 October 1999, the Commission established a basic service objective for all telephone companies in Canada.
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2.
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To ensure that telephone companies were able to provide service levels that meet the basic service objective, the Commission directed all incumbent local carriers to file service improvement plans (SIPs) for Commission approval, or demonstrate that the basic service objective has been and will continue to be achieved in their territory.
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3.
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Cochrane Public Utilities Commission and Northern Telephone Limited agreed to the transfer of Northern's telephone assets in the townships of Glackmeyer and Lamarche to Cochrane, effective 1 March 2000. In Order CRTC 2000-161, dated 29 February 2000, the Commission approved Cochrane's application to increase rates to its future Glackmeyer and Lamarche townships customers, effective 1 March 2000. Cochrane also filed its SIP on 1 March 2000 to upgrade and extend service in the two townships. Cochrane stated that it did not need further rate increases to fund its SIP. Cochrane stated that it would review whether it needed to increase its rates one year following provision of service to its new customers.
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4.
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Cochrane also filed Tariff Notice 27, on 1 March 2000, to change its obligation to provide service. In TN 27, Cochrane proposed limiting unserved customers' contribution for extending service to $1,000. Cochrane also proposed allowing unserved customers an option to pay their $1,000 contribution for extending service on an instalment basis. In its TN 27, Cochrane further proposed not extending service where the cost per subscriber actually taking service exceeds $10,000, unless customers pay the additional costs. Finally, Cochrane proposed removing customers' option to choose party-line service where individual line service becomes available.
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5.
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Cochrane advertised and held a public meeting on 2 February 2000, to consult with its customers prior to filing its SIP.
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6.
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The Commission is satisfied that Cochrane's SIP, as modified by this order, is reasonable, uses least-cost technologies and meets the basic service objective. The Commission also approves Cochrane's TN 27, subject to the following changes.
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Limits to financial obligation to extend service
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7.
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The Commission considers that the independents' financial obligation for extending service pursuant to their SIP should generally be uniform. The Commission finds that Cochrane's proposed financial limit unduly restricts its obligation to extend service to unserved areas. However, Cochrane does not have access to supplementary funding to fund its SIP, as was granted to Northwestel Inc. in Long-distance competition and improved service for Northwestel customers, Decision CRTC 2000-746, dated 30 November 2000. The Commission finds that imposing the same financial obligations on Cochrane as those approved for Northwestel would be unreasonable. Accordingly, the Commission directs Cochrane to extend service where costs per customer taking service do not exceed $15,000, including the customer's $1,000 contribution for service extension.
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Instalment payment plan
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8.
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In Decision 99-16, the Commission directed carriers to provide unserved customers the option to pay their $1,000 contribution for service extension on a reasonable instalment basis. Cochrane proposed to give its unserved customers 12 months to pay. Cochrane submitted that unserved customers requesting service should pay a $200 deposit and pay the remaining balance over the next 11 months. Cochrane did not specify whether it intended to charge interest on outstanding contribution amounts.
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9.
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The Commission considers that all independents with a SIP should provide the same instalment payment plan to their unserved customers. Both Northern and O.N.Telcom, in their respective SIP filings, did not propose to charge interest on outstanding contribution amounts. O.N. Telcom did propose to charge an interest penalty for late payments of contribution instalments due each month. In Decision 2000-746, the Commission did not allow Northwestel to charge interest on customers' outstanding $1,000 instalment payments. The Commission remains of the view that there should not be interest charges on outstanding instalment amounts. However, the Commission finds that Cochrane should be allowed to charge its tariffed late payment interest rate for late payments of instalments due each month.
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10.
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The Commission also finds reasonable that Cochrane be allowed to request a non-refundable deposit no greater than $200, payable in the first month of the instalment payment plan. The Commission is of the view that a non-refundable deposit will secure customers' commitment to, and agreement with, service extension.
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11.
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Most of the independents proposed giving new customers 12 months to pay their $1,000 contribution. In Decision 2000-746 the Commission allowed Northwestel's new customers 36 months to pay their $1,000 contribution. However, by providing an instalment payment plan, Cochrane is effectively extending interest free credit to its customers. Cochrane, unlike Northwestel, does not receive supplementary funding and the entirety of those costs are assumed by its subscribers. Moreover, unserved customers' monthly instalment payments, after the $200 deposit, will be less than $75. In the Commission's view, this monthly payment is reasonable. Accordingly, the Commission finds that allowing Cochrane's customers to pay the instalment payments over 12 months is reasonable.
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Tracking SIP implementation
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12.
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In Decision 99-16, the Commission directed telephone companies to file a plan to track and monitor the progress of their SIP and ensure they are carried out. The Commission directs Cochrane to file its tracking report on 31 March of each year, throughout the life of its SIP, and provide the following information:
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a) a list of exchanges scheduled for completion in the previous year and those actually completed;
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b) the forecasted and actual number of subscribers whose service was upgraded or to whom service was extended in the previous year;
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c) the total capital investment for the previous year;
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d) the projected service upgrade and extension for the upcoming year; and
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e) any changes to the yearly program with supporting reasons.
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13.
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The Commission directs Cochrane to file forthwith revised tariff pages that reflect the determinations made above.
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Secretary General
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This document is available in alternative format upon request and may also be examined at the following Internet site: http://www.crtc.gc.ca
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