BEFORE THE WASHINGTON UTILITIES AND TRANSPORTATION COMMISSION In the Matter of the Supplemental Application and Petition of Qwest Communications Corporation f/k/a Southern Pacific Telecommunications Company For Amendment to its Registration as a Telecommunications Company. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ) ) ) ) ) ) ) ) )) DOCKET UT-940120 SECOND SUPPLEMENTAL ORDER AMENDING REGISTRATION AND APPROVING PRICE LIST, TO INCLUDE THE COLLECTION OF ADVANCED PAYMENTS AND DEPOSITS BACKGROUND By supplemental application filed May 7, 1999, in Docket UT-940120, Qwest Communications Corporation f/k/a Southern Pacific Telecommunications Company (Qwest) seeks to amend its registration and approval of its proposed price list pursuant to RCW 80.36.350 and 80.36.320 to include prepaid calling cards. DISCUSSION Qwest is a Delaware corporation, headquartered in Denver, Colorado, and is a wholly owned subsidiary of Qwest Communications International, Inc. Rates, terms, and conditions set forth in the proposed price list are structured similarly to rates filed by other switched intraexchange and interexchange carriers for calls placed in the relevant market. On January 27, 1994, Southern Pacific Telecommunications Company filed an application for registration as a telecommunications company pursuant to RCW 80.36.350. The application was assigned Docket UT-940120. The application was approved February 23, 1994. On February 6, 1995, Southern Pacific Telecommuniations Company filed a petition seeking classification as a competitive telecommunications company pursuant to RCW 80.36.320 and WAC 480-120-023 in Docket No: UT-950150. On November 21, 1995, Southern Pacific Telecommunications Company notified the Commission of a change in its corporate name to Qwest Communications Corporation in Docket UT-951358. The petition for competitive classification was granted June 4, 1996, in Docket UT-950150. Qwest requests that the Commission authorize Qwest to offer prepaid calling card service. In support of this request, Qwest provides the following information: (1) a description of the debit card service; (2) copy of a bond in the amount of $100,000, which was provided to the Commission; (3) the revised price list; and (4) the required debit card information and affirmations. Qwest has provided information showing that it meets the requirements of RCW 80.36.350. The Commission has reviewed the supplemental application of Qwest in this matter. The Commission finds that the supplemental application for authority to provide prepaid services is appropriate and the proposed price list is consistent RCW 80.36.320(2) and WAC 480-120-027 and the Commission should grant the supplemental application and approve the proposed price list. FINDINGS OF FACT 1. Qwest Communications Corporation filed an amendment to its registration as a telecommunications company to provide debit card services. 2. As to form, the application and petition meet the requirements of RCW 80.36.350 and 80.36.320, and comply with the Commission’s rules and regulations. 3. The amendment to registration of Qwest as a telecommunications company is not inconsistent with the public interest. 4. In this proceeding, the Commission in no way endorses the financial viability of applicant nor the investment quality of any securities it may issue. 5. Alternative providers of service to that of Qwest include, but are not limited to, AT&T Communications of the Pacific Northwest, Inc., MCIWorldCom, Inc., and Sprint Communications Company L.P. All services are fully available from alternative providers in the relevant market. 6. The relevant market is the state of Washington. 7. Qwest has no captive customer base. 8. The services offered are subject to effective competition. 9. Qwest should be permitted to provide services under its proposed price list. CONCLUSIONS OF LAW 1. The Washington Utilities and Transportation Commission has jurisdiction over the subject matter of this registration application and Qwest. 2. Qwest should be permitted to provide services under price lists promulgated under RCW 80.36.320 (2). These services shall not include alternate operator services as defined in WAC 480-120-141. ORDER THE COMMISSION ORDERS: 1. After the effective date of this Order and subject to any conditions imposed, the application of Qwest Communications Corporation requesting an Order authorizing registration as a telecommunications company to provide service to the public in this state is approved. 2. The proposed price list of Qwest Communications Corporation for rates and services is approved. 3. As a telecommunications company providing service to the public in this state, Qwest Communications Corporation is subject to the jurisdiction of this Commission under the provisions of Title 80 RCW and all rules and regulations adopted by the Commission. 4. Qwest Communications Corporation is authorized to offer rates and services pursuant to price list in the format prescribed by the Commission. The price list approved in this proceeding, and subsequent changes to that price list, become effective only after ten days’ notice to the Commission and to customers. In the event of a price list reduction or of a change in terms and conditions which do not have rate impact, personal notice to customers is not required. To comply with the statutory notice requirement, Qwest Communications Corporation may publish notice of price reductions or changes in terms and conditions of service that do not have rate impact by a display advertisement in such newspaper(s) as are geographically situated to be circulated over the Company's service area. 5. Qwest Communications Corporation is not authorized to provide alternate operator services as defined in WAC 480-120-141. 6. The bond agreement filed by Qwest Communications Corporation in the amount of $100,000 is sufficient to initiate operations. Qwest Communications Corporation will adjust the amount of the bond to assure compliance with WAC 480-121-040. As part of the bond agreement and in the event the company ceases operations, Qwest Communications Corporation is required to provide notice, in writing and within 48 hours, to the insurer and the Commission to include a list of outstanding account numbers and balances. 7. Within 15 days after September 30, 1999, and each calendar quarter thereafter, Qwest Communications Corporation will be required to submit to the Commission a report containing the following information specific to its State of Washington operations: (a) total outstanding debit card balance at the beginning of the reporting period; (b) dollar amount of debit cards sold during the reporting period; (c) depleted usage of debit cards during the reporting period; and (d) total outstanding debit card balance at the end of the DOCKET 940120 reporting period. Statements shall continue to be filed within 15 days after each 3-month period thereafter until the applicant is notified in writing by the Commission that such reports are no longer required. Based upon this information, Qwest Communications Corporation will adjust the amount of the bond to assure compliance with WAC 480-121-040. In addition, Commission Staff may request current company financial information. After one year’s administration of the bond agreement, the reporting requirement may be modified to a semi-annual level, upon request by Qwest Communications Corporation and authorization by the Commission, if the company demonstrates that it has maintained adequate levels in the bond agreement during the previous 12-month period. 8. Qwest Communications Corporation shall state an unconditional money back guarantee on the face of the debit card or on supplemental material that will be provided at the time the debit card is purchased with a statement warning customers to safeguard their cards. 9. In the event the Company ceases operations, Qwest Communications Corporation is required to provide refund information to its customers on the company’s “800" phone number for a minimum of six months. 10. Qwest Communications Corporation shall provide a free call detail report to customers upon request. 11. The Commission retains jurisdiction over the subject matter and the Company to effectuate the terms of this Order. DATED at Olympia, Washington, and effective this 26th day of May, 1999. WASHINGTON UTILITIES AND TRANSPORTATION COMMISSION CAROLE J. WASHBURN, Secretary