'PEJBLIC SERVICE COMMISSION OF WEST VIRGINIA CHARLESTON. Entered: November 14, 2001 RECOMMENDED DECISION

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1 ENTERED b\ tcc PAGE 'PEJBLIC SERVICE COMMISSION OF WEST VIRGINIA CHARLESTON ORIGINAL alj wpd Entered: November 14, 2001 CASE NO T-PC FIBERNET, LLC. Petition for consent and approval of FiberNet, LLC to be designated as an eligible telecommunications carrier. RECOMMENDED DECISION On April 11, 2001, FiberNet, LLC (FiberNet), filed a petition with L L,,e Commission, pursuant to Section 214(e)(2) of the Telecommunications Act of 1996 (TA-961, seeking designation as an eligible telecommunications carrier (ETC), thereby making it eligible to receive universal service support and to offer services that are supported by federal universal support mechanisms, either using its own facilities or a combination of its own facilities and the resale of another carrier's services. FiberNet seeks an ETC designation throughout the!'current service area and wire centers" of Verizon West Virginia Inc. (Verizon WV) and Citizens Telecommunications Company of West Virginia (Citizens) in the State of West VLrginia. FiberNet listed the statutory criteria which the Commission must consider with respect to designating it as an ETC: a) FiberNet must be a common carrier; b) FiberNet must offer, or be capable of offering, the nine (9) services supported by the universal service mechanisms; 1 'The Federal Communications Commission (FCC) has identified the 9 services that are supported by Federal universal service support mechanisms as: (1) voice grade access to the public switched network; (2) local usage (i.e., a prescribed amount of minutes of use of exchange service provided free of charge to end users; (3) dual tone multifrequency (DTMF) signaling or its functional equivalent; (4) single party service or its functional equivalent; (5) access to emergency services, including access to 911 and E911 services, to the extent local governments in an eligible carrier's service area have implemented 911 or E911 systems; (6) access to operator services; (7) access to interexchange service; (8) access to directory assistance service; and (9) toll limitation for qualifying low-income consumers. 47 C.F.R (a)(1)- (9)-

2 c) FiberNet must offer these services throughout the designated service area or it must commit to so offer those services; and d) FiberNet must advertise the availability of these services and their charges or it must agree to so advertise these services. See, 47 C.F.R Finally, FiberNet must offer Link-up and lifeline services as part of its service offerings to low-income subscribers. See, 47 C.F.R and FiberNet pointed out that the FCC has concluded that neither it nor the state commissions could require an applicant to meet additional criteria and the state commissions cannot require an applicant to actually provide the supported services in a service area prior to its designation as an ETC. See, Report and Order, In the Matter of Federal- State Joint Board on Universal Service, 12 FCC Rcd 8776, 8791 q24 (1997) ; In the Matter of Federal-State Joint Board on Universal Service (Declaratory Ruling), FCC , re1 August 10, In support of its petition, FiberNet stated that, by Recommended Decision entered on July 6, 1998, Final July 26, 1998, in Case No T-CN, it was granted a certificate of convenience and necessity to provide both resold and facilities-based special access and competitive local exchange telecommunications services to customers throughout the State of West Virginia. FiberNet subsequently commenced the provision of its local exchange telecommunications services pursuant to the foregoing authorization and by virtue of an interconnection agreement approved by the Commission on July 20, 1999, in Case No T-PC, by and between FiberNet and Verizon WV, formerly Bell Atlantic-West Virginia, Inc., through a combination of its own facilities and resale. FiberNet is currently providing competitive local exchange services in approximately twenty-one counties in West Virginia. Additionally, FiberNet was granted a certificate to provide resold interexchange telecommunications services throughout West Virginia, pursuant to a Recommended Decision entered on August 3, 1999, final August 23, 1999, in Case No T-CN. Also, FiberNet has recently entered into voluntary interconnection negotiations with Citizens. Although those negotiations were on-going at the time of the filing of the petition herein, FiberNet anticipated successful completion of those voluntary negotiations with Citizens within the ensuing sixty days. In its petition, FiberNet noted that, in the case of an area served by a rural telephone company (RTC), such as Citizens, the Commission has the authority to designate an additional ETC, as long as such designation is in the public interest. 47 U.S.C. 214(e) (2). FiberNet asserted that its designation as an ETC in any such previously designated service area(s) served by RTCs would be in the public interest and would engender competition among carriers providing service supported by the federal universal service high-cost support programs. This competition would benefit consumers in terms of service choices, product offerings and pricing. Without ETC status, however, a carrier such as FiberNet might not be able to offer telecommunications services to consumers located in 2

3 RTC areas due to the substantially increased cost of service inherent in doing business in RTC areas. On May 14, 2001, Staff Attorney Patrick W. Pearlman filed an Initial Joint Staff Memorandum. Mr. Pearlman noted that the Commission had recently designated Gateway Telecom, LLC, doing business as Stratus Wave (Gateway), as an ETC. See Commission Order entered May 4, 2001, Gatewav Telecom, LLC, dba Statuswave Communications, Case No T-PC. However, Mr. Pearlman noted that FiberNet's petition differed somewhat from Gateway's in that FiberNet sought a designation as an ETC in areas served by Citizens, an RTC. Section 214(a) (2) of TA-96 provides that state commissions may designate more than one ETC in RTC service areas upon a finding that the I'public interest" would be served by such designation. Therefore, Commission Staff anticipated that this "public interest" issue would be its primary focus in this proceeding. Mr. Pearlman also noted that, in the Gateway order, the Commission established a requirement that carriers seeking designation as an ETC be required to publish notice of their petitions. Accordingly, it was recommended that the Commission direct FiberNet to publish notice of its petition for designation as an ETC in newspapers of general circulation throughout the service area for which such designation was sought, in accordance with the Commission's Order in Case No T-PC. It was further recommended that this proceeding be referred to the Division of Administrative Law Judges for further disposition. On May 21, 2001, the Consumer Advocate Division of the Public Service Commission (CAD) filed a petition to intervene in this proceeding. The CAD stated that, while it had no doubt that FiberNet qualified. as an ETC in at least some of Verizon WV's wire centers within West Virginia, it believed that the Commission must examine the extent of FiberNet's intent and capability to provide supported services throughout Verizon WV's service territory. The CAD further noted that the Commission must make a "public interest" determination prior to designating FiberNet as an ETC within the service territory of an RTC, such as Citizens. The CAD asserted that it had an interest in the impact of such determinations on the evolution of local competition in West Virginia and on the customers of incumbent RTCs. By Order dated May 25, 2001, the Commission granted the CADIS petition to intervene and ordered FiberNet to publish notice of the filing of its petition for designation as an ETC as a Class I publication in qualified newspapers of general circulation throughout the service area for which ETC designation was sought, returning proof of publication as soon as possible thereafter. The Order also referred this matter to the Division of Administrative Law Judges for further disposition and ordered that an Administrative Law Judge's decision be rendered on or before November 14, On June 15, 2001, FiberNet filed correspondence stating that it was working on carrying out the Commission's directive regarding publication. To that end, FiberNet, with Commission Staff's assistance, was attempting to draft notice language that would be acceptable to the Commission. FiberNet was hopeful that this endeavor would be completed within the next few days and that publication would begin shortly thereafter. 3

4 On July 30, 2001, FiberNet filed correspondence requesting a Sixtyday extension of the Administrative Law Judge's decision due date. AS grounds for said motion, FiberNet stated that the additional time was needed for the completion of publication of the notice of filing of its petition and for further discussions, if necessary, with Commission Staff and the CAD relative to the merits of the instant filing. FiberNet also asserted that the granting of the extension would not adversely impact any party to this proceeding and would allow adequate time for the parties to work through any issues that might be outstanding. By Order dated July 31, 2001, the Commission granted FiberNet's motion and extended the Administrative Law Judge's decision due date to January 14, On September 7 and 25, 2001, FiberNet filed affidavits of publication indicating that the Notice of Filing of its petition seeking ETC status had been published in the nineteen (19) cities designated by the Commission as constituting statewide notice. No protests, responses or objections have been filed to FiberNet's petition. On October 31, 2001, Mr. Pearlman filed a Final Joint Staff Memorandum to which was attached a Utilities Division Final Recommendation dated September 26, 2001, from Dannie L. Walker, Technical Analyst, Utilities Division. Commission Staff noted that, in order to be designated an ETC, a carrier generally must meet several criteria, including: (1) it must offer the services supported by federal universal service support mechanisms, either using its own facilities or a combination of its own facilities and resale of another carrier's services, and (2) it must advertise the availability of such services and the charges therefor using media of general distribution. 47 U.S.C. 214(e)(1)(A)&(B). State commissions shall, and in the event of an area served by an RTC, may, designate more than one (1) carrier as an ETC for a service area designated by the state commission, so long as each additional carrier requesting ETC status meets the requirements of Section 214(e) (1). 47 U.S.C. 214(e)(2). In order for an additional carrier to be designated as an ETC in an area served by an RTC, the state commission must make a further finding that the designation is "in the public interest. Id. A principle criterion of TA-96 is that the applicant for ETC status offer the nine (9) services that are supported by the federal universal service support mechanism. FiberNet states that it is capable of providing, and has commenced providing, the required services, using a combination of its own and resold facilities, to consumers in twentythree (23) counties in West Virginia. Moreover, FiberNet plans to expand provision of these services, if economically practicable, throughout West Virginia. I' In order to be designated an ETC, FiberNet must also offer the supported services throughout the service area for which designation is sought, either using its own facilities or a combination of its own facilities and resale of another carrier's services. 47 C.F.R (d)(1). According to Staff, it is sufficient if the applicant can demonstrate its capability and commitment to provide the federally supported services without the actual provision of the proposed services. rn 4

5 See Gateway at pages 4-5. With respect to demonstrating this capability and commitment, the FCC wrote: A new entrant can make a reasonable demonstration to the state commission of its capability and commitment to provide universal service without the actual provision of the proposed service. There are several possible methods for doing SO, including, but not limited to: (1) a description of the proposed service technology, as supported by appropriate submissions; (2) a demonstration of the extent to which the carrier may otherwise be providing telecommunications services within the state; (3) a description of the extent to which the carrier has entered into interconnection and resale agreements; or (4) a sworn affidavit signed by a representative of the carrier to ensure compliance with the obligation to offer and advertise the supported services. We caution that a demonstration of the capabilitv and commitment to provide service must encompass somethins more than a vague assertion of intent on the part of a carrier to provide service. The carrier must reasonably demonstrate to the state commission its ability and willinaness to provide service won desisnation. 'IDeclaratory Ruling,11 In the Matter of Federal-State Joint Board on Universal Service. CC Docket No , FCC (Rel. August 10, 2000), at 124 (emphasis added). In this case, FiberNet provided an adequate description of its proposed service technology and demonstrated the extent to which it was currently providing the supported services within the State. Staff noted that FiberNet had executed an interconnection agreement with Verizon WV that was previously approved by the Commission. See Verizon WV, Case No T-PC, Commission Order entered July 20, Moreover, FiberNet had entered into negotiations for an interconnection agreement with Citizens and expected to conclude those negotiations shortly. Further, in response to Legal Staff's informal request for information, FiberNet provided additional information regarding the extent and nature of its facilities and services in West Virginia. At the end of September 2001, FiberNet served 18,000 access lines in the State, 93.3% of which were provisioned on FiberNet's own, or leased, facilities, and it had collocated facilities in 24 central office locations in West Virginia, including two central offices in Citizens' territory. FiberNet also has an extensive fiber optic network, extending from Bluefield, West Virginia, to Wheeling and Morgantown, and thence into Pennsylvania. In addition, FiberNet had invested over $25 million in its fiber optic network and switching facilities in West Virginia, and provides the following telecommunications services: basic local service; interexchange service; Internet service; digital subscriber line (DSL); high speed data transport; wide area network (WAN) service; metropolitan area networks; wholesale services; broadband service; virtual private networks; and etherne t. Further, in order to be designated an ETC, FiberNet must be a common carrier. See 47 C.F.R (c). A "common carrier" is defined as!!any person engaged as a common carrier for hire, in interstate or foreign communication by wire or radio...i1 47 U.S.C.A (h). Common Pu blic~yrn;kion I 5 m

6 carriers are required to provide service on demand, at tariff rates that are just and reasonable, and without any unreasonable discrimination or undue preference. See 47 U.S.C.A FiberNet clearly is a "common carrier. It is certificated to provide local exchange telecommunications services to the public throughout the state and has Commission-approved tariffs governing the rates, terms and conditions of its service. See Commission Final Order entered March 25, 1999, in FiberNet, LLC., Case No T-T; Recommended Decision entered August 3, 1999, Final August 23, 1999, in FiberNet, LLC., Case No T-CN (interexchange service); Recommended Decision entered July 6, 1998, Final July 26, 1998, in FiberNet, LLC., Case No T-CN (local service). Finally, in order to be designated an ETC, FiberNet must demonstrate that it advertises the availability of its supported services and the charges for those services using media of general distribution. 47 C.F.R (d)(2). With its petition, FiberNet provided a sworn affidavit of its Vice President, verifying FiberNetIs actions to ensure compliance with the obligation to offer and advertise the supported services. In addition, FiberNet attached to its petition, as Exhibit A, copies of samples of its telephone directory, television and newspaper advertising of its services. Staff further recommended that the advertising guidelines adopted by the Commission in its Gateway Order be incorporated in the Administrative Law Judge's decision designating FiberNet as an ETC. Those guidelines are as follows: (1) (3) FiberNet must advertise in media targeted to the general residential market throughout its service area; Such advertising should be placed in media substantially similar to the media in which the serving incumbent LEC advertises its services in the particular service area. This may mean newspaper or local magazine advertisements, where the incumbent advertises its services in such publications, or use of the broadcast media (radio or television) where the incumbent uses such media; Consistent with the Commission's recently amended Telephone Rules, i.e., 150 C.S.R k, FiberNet should be required to maintain an Internet site where members of the public can obtain information regarding its services and rates; and (4) FiberNet should be required to advertise its services at least quarterly throughout the service areas for which it has been designated an ETC. Regarding the Ilpublic interest" element in connection with FiberNet's petition to be designated as an ETC in Citizens' service territory, Commission Staff stated that the FCC has not provided any guidance regarding what standard state commissions should use in determining whether the designation of additional carriers as ETCs in RTC areas is in the Ilpublic interest". However, the Washington Utilities and Transportation Commission concluded that the llpublic interest" is broader than the goal of competition alone, and is also broader than the goal of advancing universal service, although both goals may be advanced by

7 designating an additional carrier as an ETC in a rural area. See Third Supplemental Order, In the Matter of US Cellular Corporation, Docket No. UT (January 26, 20001, at ( FiberNet contended, in its petition, that consumers in areas served by RTCs should be entitled to a choice among technologies and providers through which they receive federally supported services. Competition would benefit consumers in terms of service choices, product offerings and pricing. Staff pointed out that no one has filed any comments or evidence opposing FiberNet's assertions on this point. This was particularly significant since Citizens did not file an objection to FiberNet's petition. Since Citizens has not opposed FiberNet's petition, and since no one has objected to FiberNetIs designation as an ETC in Citizens' service territory, Staff concluded that FiberNetIs assertions, i.e., that it will provide more choices in technology, service and prices for consumers in Citizens service territory, were sufficient to meet the "public interest" requirement. Commission Staff next addressed the question of defining the "service area" within which FiberNet was to be designated as an ETC. Section 214(e) (5) defines Ilservice area" as a Ingeographic area established by a state commission for the purpose of determining universal service obligations and support mechanisms." 47 U.S.C. 214(e) (5). FCC strongly encouraged states to designate service areas that are not unreasonably large, and states could base the actual level of support a carrier receives on a high cost area that is a sub-unit of a statedesignated service area. Report and Order, In the Matter of Federal- State Joint Board on Universal Service, CC Docket No , FCC (Rel. May 8, 1997) (Universal Service Order I), at According to the FCC, service areas should be sufficiently small to ensure accurate targeting of high cost support and to encourage entry by competitors. Id. at With respect to FiberNet's petition for ETC designation in the area served by Verizon WV, Staff recommended that service areas be defined by the incumbent LEC's serving wire center. See Gateway, at page 16. Accordingly, FiberNet should be designated as an ETC for all wire centers served by Verizon WV. A list of those wire centers was attached to Staff's Memorandum. The situation is somewhat more complicated for the areas served by Citizens. In the case of areas served by an RTC, a llservice area" means the RTCIs llstudy area" unless and until the FCC and the state commission, establish a different definition of service area for that company. 47 U.S.C. 214(e)(5). Citizens has three "study areas" in West Virginia: (1) CTC of West Virginia-St. Marys, Study Area No ;2 (2) CTC of West Virginia-Bluefield, Study Area No ;3 and (3) CTC of West Virginia-Mountain State, Study Area No According to Staff, it would be appropriate to designate FiberNet as an ETC for each Citizens The 2 Former Contel properties and service area. 3Former GTE properties and service area. 4 Former AllTel properties and service area. 7

8 study area; however, the FCC has recently suggested that RTC study areas be disaggregated for purposes of ETC designation and universal service support. See Fourteenth Report and Order, In the Matter of Federal-State Joint Board on Universal Service, CC Docket Nos & , FCC (Rel. May 23, 2001) (Universal Service Order XIV). In that Order, the FCC agreed with the Rural Task Force's disaggregation and targeting proposal and concluded that: [AIS a general matter, support should be disaggregated and targeted below the study area level. At the same time, we agree with the Rural Task Force that, given the significant differences among rural carriers and the varying competitive environments among the states, there should be flexibility in the manner in which support is disaggregated and targeted for rural carriers. Accordingly, subject to certain modifications... we adopt generally the three paths for the disaggregation and targeting of high-cost universal service support proposed by the Rural Tash Force. We also adopt the general requirements that the Rural Task Force proposed for all disaggregation plans. Universal Service Order XIV, at According to Staff, the FCC's decision was not just academic. The FCC noted that the provision of uniform support throughout a study area may create uneconomic incentives for competitive entry and could result in support not being used for the purpose for which it was intended, because support is averaged across all lines served by an RTC within its study area, even though costs within the study area may vary widely. Id. at Under this scenario, support would be available to a competitive ETC that served only low-cost exchanges within the study area, regardless of whether the support exceeds the cost of any of the lines. - Id. The FCC directed RTCs to choose, within 270 days of the effective date of the rules adopted in its order, one of the three paths recommended by the Rural Task Force, subject to certain FCC modifications. The deadline for RTCs like Citizens to select one of the three paths is March 15, The three disaggregation paths established in Universal Service Order XIV were summarized by Commission Staff. Competitive ETCs are bound by the disaggregation and targeting path selected by the rural incumbent carrier in whose territory they serve. Competitive ETCs, therefore, are not required to select a disaggregation and targeting path and are not subject to the associated reporting requirements. With respect to FiberNetls petition to be designated as an ETC in Citizens' sewice territory, and in light of Citizens' pending option to disaggregate and target Federal universal service support pursuant to the FCCIs Universal Service Order XIV, Staff recommended that FiberNet be designated as a competitive ETC in each of the three (3) study areas served by Citizens. Should Citizens opt to disaggregate and target support in any study area, the order designating FiberNet as a competitive ETC should make it clear that its designation shall apply in any disaggregated unit selected by Citizens and approved by the Commission. This would include wire centers, or even smaller target areas. A list of a

9 Citizens' wire centers, grouped by study area, was attached to Staff Is Memorandum. The Final Joint Staff Memorandum was served upon counsel for FiberNet and counsel for the CAD, giving them 10 days in which to respond thereto, in writing. On November 8, 2001, FiberNet filed correspondence stating that, with one (1) clarification, it was in complete agreement with the representations and recommendations contained in Commission Staff's October 31, 2001 Final Joint Staff Memorandum. On page four (4) of the Final Joint Staff Memorandum, Commission Staff had represented that FiberNet had collocations established in two (2) central offices located in Citizens' service territory. Although FiberNet was actively working with Citizens on those and other potential collocations, the two (2) collocations cited by Commission Staff in its Final Joint Staff Memorandum had not, as yet, been turned up for service. However, it was expected that work on those two (2) collocations would continue in earnest following the execution of a comprehensive interconnection agreement between FiberNet and Citizens, which should occur by no later than November 16, The ten-day response period expired on Tuesday, November 13, 2001 (due to the Veterans Day Holiday and weekend). The CAD filed no response to the Final Joint Staff Memorandum. DISCUSSION Under the Telecommunications Act of 1996, designation as an ETC is essential in order for common carriers of telecommunications services to be eligible to receive federal universal service support pursuant to 47 U.S.C In order to be designated as an ETC, a carrier must: (1) be a common carrier; (2) offer the services supported by federal universal service support mechanisms under 47 U.S.C. 254(c), either using its own facilities or a combination of its own facilities and resale, throughout the designated service area; (3) advertise the availability of such services and the charges therefor, using media of general distribution. 47 U.S.C. 214(e) (1) (A)&(B); and (4) offer Link-Up and lifeline services as part of its service offerings to low-income subscribers. See 47 C.F.R and TA-96 provides that, [a] State Commission shall upon its own motion or upon request designate a common carrier that meets the requirements of [47 U.S.C. 214(e) (111 as an eligible telecommunications carrier for a service area designated by the State Commission U.S.C. 214(e) (2). If more than one carrier requests to be designated as an ETC for a service area, the state commission must designate such carrier as an ETC (assuming the carrier meets the requirements of 47 U.S.C. 214(e) (1), but, in the case of areas served by a rural telephone company, the state 50n March 19, 2001, in Case No T-T, FiberNet submitted a tariff filing'to the Commission, effective April 19, 2001, in order to implement the Link-Up America and Tel-Assistance Lifeline programs.

10 commission may (but is not required to) designate more than one ETC Per area served. FiberNet is certificated by the Commission to provide both resold and facilities-based local exchange and resold interexchange telecommunications services throughout the State and is capable of providing all of the service offerings required and set forth in 47 U.S.C. 214(e)(1) for "eligible telecommunications carriers. As a matter of fact, FiberNet is currently providing competitive local exchange service in approximately twenty-three counties in West Virginia, is clearly a llcommon carrier" as defined by 47 U.S.C. 153(h) and has provided an adequate description of its proposed service technology and demonstrated the extent to which it is currently providing the supported services within the state. FiberNet has provided a sworn affidavit of its Vice President, as well as samples of its telephone directory, television and newspaper advertising of its services to demonstrate its compliance with the obligation imposed by 47 C.F.R (d)(2) to offer and advertise the availability of its supported services and the charges for those services. FiberNet also stated that it intends to continue and expand upon its marketing efforts on a prospective basis as it introduces its telecommunications services and products to other areas in West Virginia. Accordingly, it is appropriate that FiberNet be directed to continue the advertising of the availability of its supported services and the charges therefor in accordance with the guidelines established by the Commission in Gatewav. FiberNet has asserted in its petition that consumers in areas served by RTCs, i.e., Citizens' service territory, should be entitled to a choice among technologies and providers through which they receive federally supported services and that competition will benefit consumers in terms of service choice, product offerings and pricing. No comments or evidence have been filed in opposition to FiberNet's assertions on this point, nor has Citizens objected to FiberNet's petition. Therefore, the undersigned Administrative Law Judge must conclude, as did Commission Staff, that FiberNet's assertions regarding the provision of more choices in technology, services and prices for consumers in Citizens' service territory are sufficient to meet the ''public interest'' requirement to allow FiberNet to be designated as an ETC in Citizens' service territory. Commission Staff has recommended that FiberNet be designated as an ETC for all wire centers served by Verizon WV and, in light of the Commission's discussion and holding in Gateway, the undersigned concurs with that recommendation. Further, the undersigned concurs that FiberNet should be designated as a competitive ETC in each of the three study areas served by Citizens and that this designation should apply, if Citizens elects to disaggregate, in any disaggregated unit selected by Citizens and approved by the Commission. It is believed that this course of action will more fully accomplish the objectives of targeting support for rural carriers; promoting the competitive entry of new service providers into relatively small areas; and more closely associating support with the cost of providing service. Finally, it must also be noted that, in its "Report and Order'', In the Matter of Federal-State Joint Board on Universal Service, CC Docket No , (Rel. May 8, 1997) (FCC Universal Service Order), the FCC 10 'I

11 stated that the Universal Service Administrative Company (USAC), selected by the FCC, is not to disburse federal universal service funds to a carrier until the carrier has provided the USAC with a true and correct copy of the state commission order designating that carrier as an ETC. FCC Universal Service Order, On September 29, 1997, the FCC issued a public notice (DA ) directing each state commission to submit to the FCC and the USAC, by December 31, 1997, a list of carriers that each commission has designated as an ETC. This list must be submitted in order for carriers to be eligible to receive federal universal service funding for high cost, low-income, and health care support beginning January 1, In an October 27, 1997 letter to national and state telecommunications carrier associations, the USAC made it clear that the requirement for state commissions to submit a list of designated ETCs does not remove the requirement for a carrier to submit a copy of the state commission order designating it as an ETC. No federal funding will be paid to a carrier without a copy of the designation order. Therefore, Commission Staff will be directed to immediately provide to the FCC and the Universal Service Administrative Company, as requested in the FCCIs Public Notice DA (Rel. September 29, 19971, a certified copy of this Order designating FiberNet as an ETC and a list of the areas designated to be served by FiberNet. FINDINGS OF FACT 1. Pursuant to 214(e)(2) of the Telecommunications Act of 1996, FiberNet, LLC, has filed a petition with the Commission seeking designation as an eligible telecommunications carrier, thereby making it eligible to receive universal service support and to offer services that are supported by federal universal service support mechanisms, either using its own facilities or a combination of its own facilities and the resale of another carrier's services. FiberNet sought an ETC designation throughout the "current service area and wire centers" of Verizon West Virginia Inc. and Citizens Telecommunications Company of West Virginia in the State of West Virginia. (See, Petition filed April 11, 2001, and attachments). 2. FiberNet is certificated as a competitive resold and facilities-based local exchange telecommunications carrier. (See, Recommended Decision entered July 6, 1998, Final July 26, 1998, in Case NO T-CN). 3. FiberNet provides local exchange telecommunications services pursuant to the authority granted in Case No T-CN and by virtue of an interconnection agreement with Verizon WV approved by the Commission on July 20, (See, Case No T-C). 4. FiberNet is also certificated to provide resold interexchange telecommunications services throughout West Virginia. (See, Case No T-CN). 5. FiberNet has recently entered into voluntary interconnection negotiations with Citizens Telecom which were anticipated to be successfully completed within a short time period. (See, Petition filed April 11, 2001; response filed November 8, 2001).

12 6. FiberNet filed affidavits of publication indicating that the Notice of Filing of its petition had been published in the nineteen (19) cities constituting statewide notice. (See, May 25, 2001 Commission Order; affidavits of publication filed September 7 and 25, 2001). 7. No protests, responses or objections have been filed to FiberNetIs petition. (See, case file generally). 8. In order to be designated an ETC, a carrier must meet the following criteria: (1) it must be a common carrier; (2) the carrier must offer the services supported by federal universal service support mechanisms, either using its own facilities or a combination of its own facilities and the resale of another carrier's services, throughout the designated service area; (3) it must advertise the availability of such services and the charges therefor using media of general distribution; and (4) it must offer tel-assistance and Link-up services to its lowincome customers. (See, 47 U.S.C. 214(e) (1) (A)&(B)). 9. State commissions shall, or in the event of an area served by an RTC may, designate more than one (1) carrier as an ETC for a service area designated by the state commission, so long as each additional carrier requesting ETC status meets the requirements of 214(e)(1). In order for an additional carrier to be designated as an ETC in an area served by an RTC, the state commission must make a further finding that the designation is "in the public interest." (See, 47 U.S.C. 214(e)(2) FiberNet has provided an adequate description of its proposed service technology and had demonstrated the extent to which it was currently providing the supported services within West Virginia. (See, Petition filed April 11, 2001; Final Joint Staff Memorandum and attachment filed October 31, 2001). 11. FiberNet has been, and intends to continue, advertising the availability of its supported services and the charges for those services using media of general distribution, including, but not limited to, telephone directory, television and newspaper advertising. (See, 47 C.F.R (d) (2) ; affidavits and Exhibit A attached to Petition filed April 11, 2001). 12. Commission Staff recommended that the advertising guidelines adopted by the Commission in its Gatewav Order be incorporated in any decision designating FiberNet as an ETC. (See, May 4, 2001 Commission Order in Gatewav Telecom, LLC, Case No T-PC; Final Joint Staff Memorandum and attachment filed October 11, 2001). 13. Commission Staff is of the opinion that FiberNetIs assertions, i.e., that it will provide more choices in technology, services and prices for consumers in Citizens' service territory, are sufficient to meet the 'Ipublic interest" requirement for designation as an ETC in an RTC area. (See, Final Joint Staff Memorandum and attachment filed October 31, 2001). 14. Commission Staff recommended that FiberNet be designated as an ETC for all wire centers served by Verizon WV and in each of the three study areas served by Citizens. Should Citizens opt to disaggregate and m 12

13 target support in any study area, FiberNet's designation as an ETC would apply in any disaggregated unit selected by Citizens and approved by the Commission. (See, Fourteenth Report and Order, In the Matter of Federal- State Joint Board on Universal Service, CC Docket Nos and , FCC (Rel. May 23, 2001); Final Joint Staff Memorandum and attachment filed October 31, 2001). 15. The FCC requires that each state commission submit to it and the Universal Service Administrative Company a list of carriers that each commission has designated as ETCs in order for carriers to be eligible to receive federal universal service funding for high cost, low-income and health care support beginning January 1, (See, In the Matter of Federal-State Joint Board on Universal Service, CC Docket No , (Rel. May 8, 1997); FCC Public Notice DA (Rel. September 29, 1997). CONCLUSIONS OF LAW 1. FiberNet has demonstrated that it is a common carrier capable of providing all of the service offerings required by and set forth in 214(e) of the Telecommunications Act of 1996 for "eligible telecommunications carriers'!, throughout the designated service areas, using either its own facilities or a combination of its own facilities and the resale of another carrier's services. 2 FiberNet has been, and intends to continue, advertising the availability of its telecommunications services using media of general distribution. 3. FiberNet's assertions that it will provide more choices in technology, services and prices for consumers in Citizens' service territory are sufficient to meet the Ilpublic interest" requirement for designation as an ETC in the areas served by Citizens as an RTC. 4. FiberNet should be designated as an ETC for all wire centers served by Verizon WV. 5. FiberNet should be designated as an ETC for each of the three study areas served by Citizens. Should Citizens opt to disaggregate and target support in any study area, FiberNet's designation as an ETC shall also apply in any disaggregated unit selected by Citizens and approved by the Commission. 6. FiberNet shall follow and abide by the advertising guidelines established by the Commission in Case No T-PC, Gatewav Telcom, LLC. dba StratusWave Communications (May 4, 2001). ORDER IT IS, THEREFORE, ORDERED that the petition filed herein on April 11, 2001, by FiberNet, LLC, seeking designation as an eligible telecommunications carrier pursuant to 47 U.S.C. 214(e) in the current service area and wire centers of Verizon West Virginia Inc., and Citizens Telecommunications Company of West Virginia, be, and hereby is, granted. 13

14 IT IS FURTHER ORDERED that FiberNet be, and hereby is, designated as an eligible telecommunications carrier, pursuant to 47 U.S.C. 214 (e) for all wire centers served by Verizon WV in West Virginia, and for the three (3) study areas served by Citizens, an RTC, in West Virginia. Should Citizens opt to disaggregate and target support in any study area, FiberNet's designation as an ETC shall also apply in any disaggregated unit or target area selected by Citizens and approved by the Commission. IT IS FURTHER ORDERED that FiberNet shall follow and abide by the advertising guidelines established by the Commission in Gatewav Telcom, LLC. dba StratusWave Communications, Case No T-PC (May 4, 2001). IT IS FURTHER ORDERED that Commission Staff shall immediately provide to the FCC and the Universal Service Administrative Company, as requested in the FCCIs Public Notice DA (Rel. September 29, 19971, a certified copy of this order designating FiberNet as an ETC for all wire centers served by Verizon WV in West Virginia and for the three (3) study areas served by Citizens, an RTC, in West Virginia, along with a list of the areas designated to be served by FiberNet. IT IS FURTHER ORDERED that this case be removed from the Commission's docket of open cases. The Executive Secretary is hereby ordered to serve a copy of this order upon the Commission by hand delivery, and upon all parties of record by United States Certified Mail, return receipt requested. Leave is hereby granted to the parties to file written exceptions supported by a brief with the Executive Secretary of the Commission within fifteen (15) days of the date this order is mailed. If exceptions are filed, the parties filing exceptions shall certify to the Executive Secretary that all parties of record have been served said exceptions. If no exceptions are so filed this order shall become the order of the Commission, without further action or order, five (5) days following the expiration of the aforesaid fifteen (15) day time period, unless it is ordered stayed or postponed by the Commission. Any party may request waiver of the right to file exceptions to an Administrative Law Judge's order by filing an appropriate petition in writing with the Secretary. No such waiver will be effective until approved by order of the Commission, nor shall any such waiver operate to make any Administrative Law Judge's Order or Decision the order of the Commission sooner than five (5) days after approval of such waiver by the Commission. MKM/JPC:dfs a. wpd Melissa K. Marland Chief Administrative Law Judge Public Service Canmission nla 14