DOCKET UT-980035 Page 1 BEFORE THE WASHINGTON UTILITIES AND TRANSPORTATION COMMISSION In the Matter of the Application ) DOCKET UT-971705 of SMARTSTOP, INC., ) for an Order Authorizing ) the Registration of Applicant ) AUTHORIZING as a Telecommunications Company ) REGISTRATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ) On December 1, 1998, SmartStop, Inc., filed an application for registration as a telecommunications company pursuant to RCW 80.36.350. Applicant proposes to offer resold direct dialed long distance, debit card, and pay telephone services to the public. SmartStop, Inc., is an Oregon corporation, headquartered in Portland, Oregon. The corporation is equally owned by Jubitz Corporation and B.R.G. Corporation. SmartStop, Inc., has provided information showing that it possesses adequate financial resources, and technical competence to provide the proposed services. The nature of the debit card service implies SmartStop, Inc., proposes to collect advance payments from customers. Pursuant to statutes and rules governing registration applications and advance payment proposals, SmartStop, Inc., has submitted a satisfactory bond agreement for protection of those advance payments. Initially, the bond agreement will be for $5,000 and will increase proportionally as customer base increases. If SmartStop, Inc., ceases operations, SmartStop, Inc., will provide the insurer and the Commission lists of outstanding account numbers and balances within 48 hours. SmartStop, Inc., will limit the maximum denomination of each debit card purchased by residential customers to not more than $50 and debit cards purchased by business customers to not more than $200. Within 15 days after June 30, 1998, and quarterly thereafter, SmartStop, Inc., 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 NO. UT-971705 PAGE 1 reporting period. Statements shall continue to be filed within 15 days after each 3-month period thereafter until Commission staff informs applicant such reports are no longer required. Based upon this information, SmartStop, Inc., 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 if the company has maintained adequate levels in the bond agreement during the previous 12-month period. SmartStop, Inc., will state an unconditional money-back guarantee on 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. If SmartStop, Inc., goes out of business, it will provide refund information on the company's 800 phone number for its customers. SmartStop, Inc., will provide a free call detail report to customers upon request. FINDINGS THE COMMISSION FINDS: 1. SmartStop, Inc., filed an application pursuant to the provisions of RCW 80.36.350 and the rules and regulations of the Commission for an order approving its application for registration as a telecommunications company. 2. As to form, the application filed herein, as supplemented and amended, meets the requirements of RCW 80.36.350 and the rules and regulations of the Commission adopted pursuant thereto. 3. The registration of SmartStop, Inc., 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. O R D E R THE COMMISSION ORDERS: 1. After the effective date of this order and subject to the conditions hereof, the application of SmartStop, Inc., filed with the Commission pursuant to the provisions of RCW 80.36.350 requesting an order authorizing registration as a telecommunications company to provide service to the public in this state is approved. 2. The proposed tariff as filed on December 1, 1997, and amended in Exhibit G, attached to the application, is satisfactory. Prior to supplying service to the public as a telecommunications company, SmartStop, Inc., shall file an initial tariff, within thirty days of the effective date of this order, with the Commission identical to the amended Exhibit G of the application. The tariff shall bear an effective date not less than 30 days subsequent to the date of receipt by the Commission. 3. SmartStop, Inc., has submitted to the Commission a satisfactory bond agreement in the amount of $5,000. As part of the bond agreement and in the event the company ceases operations, SmartStop, Inc., will within 48 hours provide to the bank and the Commission lists of outstanding account numbers and balances. 4. SmartStop, Inc., will limit the amount of debit cards to be purchased to not more than $50 increments for residential customers and $200 for business customers. 5. Within 15 days after June 30, 1998, and quarterly thereafter, SmartStop, Inc., 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 NO. UT-971705 PAGE 1 reporting period. Statements shall continue to be filed within 15 days after each 3-month period thereafter until Commission staff informs applicant such reports are no longer required. Based upon this information, SmartStop, Inc., 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 if the company has maintained adequate levels in the bond agreement during the previous 12-month period. 6. SmartStop, Inc., shall state that there is a money-back guarantee on the debit cards and provide a statement warning customers to safeguard their cards. 7. In the event the company ceases operations, SmartStop, Inc., will provide refund information on the company's 800 phone number for its customers for a minimum of six months. 8. SmartStop, Inc., will provide a free call detail report to customers upon request. 9. Registration of SmartStop, Inc., as a telecommunications company shall not be construed as an endorsement of financial viability nor of the investment quality of any securities it may issue. 10. As a telecommunications company providing service to the public in this state, SmartStop, Inc., is subject to the jurisdiction of this Commission under the provisions of Title 80 RCW and all rules and regulations of the Commission adopted pursuant thereto. 11. SmartStop, Inc., is subject to compliance with WAC 480-120-141, alternate operator service rule. DATED at Olympia, Washington, and effective this th day of April, 1998. PAUL CURL, Acting Secretary