ARCHIVED - Decision CRTC 2001-372

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Decision CRTC 2001-372

Ottawa, 22 June 2001

Our file number: 8678-C12-02/01


Mr. Mark Connors
Manager - Regulatory Matters
Aliant Telecom Inc.
P.O. Box 2110
St. John's, Newfoundland
A1C 5H6

Dear Mr. Connors:

Subject: Aliant Telecom Inc. - Application for exogenous treatment of additional costs related to network congestion

On 30 March 2001, Aliant Telecom Inc. filed an aggregate price cap filing for the former Island Telecom Inc., Maritime Tel & Tel Inc. (MTT), NBTel Inc. and NewTel Communications Inc. that included an exogenous factor of $7.7 million to flow through to the capped services the additional costs for advancing the Newfoundland Network Enhancement Plan (NEP). The Newfoundland NEP was advanced to alleviate the congestion in NewTel's network.

The Commission notes that the management of the construction program is one of the primary functions of the company. The advancing of the construction program to meet customer demand is one of the tools available to the company to ensure adequate network performance.

After more than a year of network congestion problems, NewTel subscribers were still experiencing serious difficulties accessing emergency services via the NewTel network. The advancement of NewTel's construction program, which was subsequently approved by the Commission, was a direct result of the seriousness of the situation and the need for the company to effectively address the problem.

The Commission does not consider that the additional costs incurred by the company for advancing its construction program to alleviate the network congestion satisfies the criteria for exogenous treatment as set out in paragraph 105 of Telecom Decision CRTC 97-9, Price cap regulation and related issues, dated 1 May 1997. In particular, criterion (1) requires the event to be "legislative, judicial or administrative actions which are beyond the control of the company" [ emphasis added] . The proper management of the construction program results in a network that meets customer demand. This is not beyond the control of the company.

Accordingly, the Commission denies Aliant's request for exogenous treatment of the additional costs incurred by NewTel to advance its construction program. Further, the Commission orders Aliant to re-file NewTel's overall price cap index (PCI) for its capped services and its sub-basket limits (SBLs) for each of its Residence and Other sub-baskets to exclude the exogenous factor associated with the advancement of the Newfoundland NEP.

Yours sincerely,

Ursula Menke
Secretary General

c.c.: Steve Malowany, CRTC, (819) 953-2167

Date Modified: 2001-06-22

Date modified: