DOCKET NO. UT-960269 PAGE 1
BEFORE THE WASHINGTON UTILITIES AND TRANSPORTATION COMMISSION



      ) DOCKET NO. UT-960269
In the Matter of     )
      ) INTERPRETIVE AND POLICY 
Implementation of Certain Provisions ) STATEMENT REGARDING         
of the Telecommunications Act of 1996 ) NEGOTIATION, MEDIATION,
      ) ARBITRATION, AND APPROVAL
      ) OF AGREEMENTS UNDER THE
      ) TELECOMMUNICATIONS ACT
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ) OF 
1996



I.  INTRODUCTION

  This is an interpretive and policy statement of the Washington Utilities and 
Transportation Commission (Commission) pursuant to RCW 34.05.010(8) and (14), 
34.05.230, and WAC 480-09-200.  The general purpose of the statement is to 
interpret the Telecommunications Act of 1996, Public Law No. 104-104, 101 Stat. 
56 (1996)(the “Act” or the “1996 Act”), and to inform the telecommunications 
industry and other members of the public how the Commission plans to implement 
its obligations under the Act.  Given the time required to complete rulemaking, 
the constraints imposed by the Act, and the fact that the Commission may be 
presented with requests for mediation or arbitration at any time, it is not 
feasible or practical to adopt formal administrative rules at this time.  RCW 
34.05.230(1).  It is the intention of the Commission, however, to undertake any 
necessary rulemaking as soon as practicable. RCW 34.05.230(2).

  The Commission has broad authority under Washington law to undertake the 
tasks delegated to it by the 1996 Act.  The Commission is authorized to “[e]
xercise all the powers and perform all the duties prescribed therefor by this 
title [Title 80] and by Title 81 RCW, or by any other law.”   See generally RCW 
80.01.040; Tanner Electric Cooperative v Puget Sound Power & Light, 128 Wn. 2d 
656 (1996).

  While the contents of an interpretive and policy statement are generally 
deemed advisory,  as noted above,  the Commission has broad authority under 
existing law to implement the Act.  Further, cooperation by parties in these 
proposed procedures is essential to the effective administration of the Act, 
and is to the parties’ own benefit in achieving the Act’s purposes.  Failure to 
cooperate with the Commission as it carries out its functions under the Act 
constitutes a “failure to negotiate in good faith.” 47 USC § 252(b)(5).  The 
term “shall” in the text of this interpretive and policy statement and the 
model order is  used with these considerations in mind. 
 
 

  This interpretive and policy statement contains the following:

   I.  Introduction

   II.  Procedures for Interconnection Agreements

    A. Negotiation

    B. Mediation

    C. Arbitration

1. Model Order on Arbitration Procedure,     attached as Appendix A.

   III.  Approval of Agreements
  
   IV.  Preferred Outcomes For Washington Interconnection Agreements


II.  PROCEDURES FOR INTERCONNECTION AGREEMENTS

A.  Negotiation

  1.  Parties shall notify the Commission in writing when a “request for 
negotiation” has been made under Section 252 of the 1996 Act.  The notification 
shall include the names of the negotiating parties and the date of the request. 

  2.  The notification shall be served on all parties to the negotiation, and 
on the Commission’s telecommunications mailing list, which can be obtained from 
Records Center. Any person receiving notice of the request for negotiation 
shall notify the negotiating parties and the Commission in writing if it wishes 
to receive service of any petition for arbitration, response, or request for 
approval arising out of the noticed negotiation.

  3.  In order to allow the Commission to plan for staff resources, parties are 
requested to notify the Commission after 90 days of the status of the 
negotiation.

  4.  The Commission interprets 47 USC §§ 252(c)(1) and 252(b)(5) as creating a 
general duty to negotiate in good faith which applies during the negotiation, 
mediation, arbitration and approval processes discussed in this statement.




B.  Mediation

  1.  Any party negotiating an agreement under 47 USC § 252 may, at any point 
in the negotiation, ask the Commission to participate in the negotiation and to 
mediate any differences arising in the course of the negotiation.  Parties need 
not seek mediation by the Commission and are free to employ the services of a 
private mediator.

  2.   If a party requests mediation by the Commission, the Commission will use 
a co-mediation process involving both a Commission Staff member and a neutral 
professional mediator from outside the agency.  The negotiating parties shall 
jointly retain the services of a professional mediator acceptable to all 
parties and shall share the costs of the mediator equally. The parties shall 
secure the mediation services and identify the professional mediator to the 
Commission not later than five business days after the request for mediation, 
unless more time is allowed by the Commission.  The Commission will appoint a 
member of the Commission Staff to serve as a co-mediator following 
identification of the professional mediator by the parties. The parties may 
recommend the area of expertise required by the Commission Staff mediator.

  3.   Employees acting as mediators will not participate in the arbitration or 
approval process for the same agreement, unless the parties consent. 

  4.   A request for mediation shall contain a brief statement of the nature of 
the dispute and the names, addresses, telephone and fax numbers of the parties 
or their representatives. Copies of the request shall be served on all parties 
to the negotiation.

  5.  Within five business days after the professional mediator is identified 
to the Commission, the parties shall provide to the mediators a statement of 
position and relevant background information, including: (1) a list of all 
issues raised in the negotiation on which mediation is sought, and (2) a list 
of all issues the parties have resolved through negotiation.
 
  6.  The mediator shall have discretion to regulate the course of the 
mediation, including scheduling of mediation sessions, in consultation with the 
parties. The following general procedures apply: (1) The mediator will not 
impose a settlement but can offer proposals for settlement; (2) the mediator 
may meet individually with the parties or attorneys during mediation; (3) only 
the parties to the negotiation may attend the mediation session(s), unless all 
parties consent to the presence of others; (4) parties shall provide the 
mediator with a brief statement of position and relevant background information 
prior to the first mediation session (See paragraph 5 above). The mediator may 
ask for this information to be supplemented; (5) the mediator does not provide 
legal advice to the parties, nor are any  mediator’s statements as to law or 
policy binding on the Commission, unless later adopted by the Commission; (6) 
the mediation process is confidential, to the extent permitted by law. No 
stenographic record will be kept.



  7.  The provisions of WAC 480-09-465 are applicable to mediations under the 
1996 Act, to the extent consistent with this interpretive statement,  including 
the availability of protective orders under WAC 480-09-465(3)(c).

  8.  Although mediation is generally a voluntary process, the Commission 
interprets 47 USC § 252(a)(2) to require all parties to participate in a 
Commission mediation, once requested.  The mediator may terminate the mediation 
if it appears that the likelihood of agreement is remote.  Ordinarily, a 
mediation should not be terminated prior to the completion of at least one 
mediation session. 

Fees and Costs

  1.  Each party shall be responsible for bearing its own fees and costs. Each 
party shall pay any fees imposed by Commission rule or statute.

C. Arbitration

Nature of the Proceeding

  1.  The 1996 Act does not define the term “arbitration.”  The Commission 
interprets the term to mean an alternative dispute resolution process in which 
a neutral third party decides a matter in dispute.  Black’s Law Dictionary (6th 
Ed.) defines arbitration as a “process of dispute resolution in which a neutral 
third party (arbitrator) renders a decision after a hearing at which both 
parties have an opportunity to be heard. . . . An arrangement for taking and 
abiding by the judgement of selected persons in some disputed matter, instead 
of carrying it to established tribunals of justice, and is intended to avoid 
the formalities, the delay, the expense, and the vexation of ordinary 
litigation.”   The Commission does not interpret the term arbitration in  the  
1996 Act to include arbitration under either the United States Arbitration Act, 
9 USC § 1 et seq., or the Washington Arbitration Act, RCW 7.04.010 et seq.  

  2.  Arbitrations under the 1996 Act will not be deemed adjudicative 
proceedings under the Washington Administrative Procedure Act.   Because 
arbitrations under the Act are not private, but are to be conducted by the 
state Commission, they are subject to judicial review and the parties should be 
afforded a process appropriate to the nature of the proceeding.  Arbitration 
decisions are binding only upon the parties to the arbitration.  The Commission 
interprets the Act as contemplating that arbitrations involve only the parties 
to the negotiation.  Others may ask to participate but will be allowed to do so 
only upon a showing of compelling public interest.  The Public Counsel Section 
of the Office of Attorney General may request participation in an arbitration 
pursuant to RCW 80.04.510.  Such participation may be subject to limitations 
designed to further the efficient resolution of the issues.




  3.  Within these parameters, the Commission intends that arbitration under 
the 1996 Act be conducted by all participants as a dispute resolution process 
alternative to adversarial litigation, comparable to private arbitration. This 
process should be characterized by fairness, cooperation and openness between 
the parties, and is designed to resolve the dispute in an efficient and 
economical manner.

Filing and Service of  A Petition For Arbitration

  1.  During the period from the 135th to the 160th day (inclusive) after the 
date on which an incumbent local exchange carrier receives a request for 
negotiation under 47 USC § 252(b)(1), any party to the negotiation may petition 
the Commission to arbitrate any open issues. The Commission interprets the 
phrase “any open issues” in Section 252(b)(1) to mean all unresolved issues.  
The petition shall request arbitration of all issues which are unresolved at 
the time the petition is filed.  Parties may continue to mediate or otherwise 
resolve the disputed issues after arbitration is requested. The pendency of a 
mediation shall not bar a party from petitioning the Commission for arbitration.

  2.  Petitions for arbitration under Section 252(b)(2) shall be filed with the 
Commission in the manner provided for the filing of petitions under WAC 
480-09-120 and 420. The party petitioning for arbitration shall deliver to the 
other party or parties to the negotiation a complete copy of the petition and 
all accompanying documentation on the same day that the petition is filed with 
the Commission. 

Contents of Petition and Documentation

  1.  A petition for arbitration shall clearly set forth the date upon which 
the original “request for negotiation” was received and the dates 135 days, 160 
days and 9 months thereafter.

  2.  Petitions for arbitration shall be accompanied by all relevant 
documentation concerning the unresolved issues; the position of each of the 
parties with respect to those issues; and any other issue discussed and 
resolved by the parties.  Relevant documentation  includes but is not limited 
to the following:

   a.  A brief or other written statement addressing the disputed issues. The 
brief should address, in addition to any other matters, how the parties’ 
positions, and any conditions requested,  meet or fail to meet the requirements 
of Section 251 and 252 of the 1996 Act, any  applicable FCC regulations, and 
any applicable regulation, order or policy of this Commission.  
 
   b.  Where prices are in dispute, the petitioning party, if an incumbent 
carrier, shall submit its proposed rates or charges, and all relevant cost 
studies and related supporting  materials.  If the petitioning party is not an 
incumbent carrier, the petitioner shall submit the foregoing materials to the 
extent available.

   c. Any conditions which the petitioning party requests be imposed.

   d. A proposed schedule for implementation of the terms and conditions by the 
parties to the agreement.

   e. The petition may include a recommendation as to any information which 
should be requested from the parties by the arbitrator pursuant to Section 
252(b)(4)(B). The recommendation should state why the information is necessary 
for the arbitrator to reach a decision on the unresolved issues.
 
   f.  At the party’s option, a proposed interconnection agreement may be 
submitted.

   g. Any other documents relevant to the dispute, including copies of all 
documents in their possession or control on which they rely in support of their 
positions or which they intend to introduce as exhibits at the hearing.  

  3.  All petitions, responses and accompanying documentation shall be verified 
as provided by WAC 480-09-425, or submitted by affidavit or declaration.

Responses

  The non-petitioning parties may respond to the petition and may file such 
additional information as they wish with the arbitrator 25 days after the 
petition filing date. At a minimum, the response shall include:

   a. A brief or other written statement addressing the disputed issues. The 
brief should address, in addition to any other matters, how the parties’ 
positions, and any conditions requested,  meet or fail to meet the requirements 
of Section 251 of the 1996 Act, any applicable FCC regulations, and any 
applicable regulation, order or policy of this Commission.  
 
   b. Where prices are in dispute, the responding party shall submit its 
proposed rates or charges, and all relevant cost studies and related 
supporting  materials. If the responding  party is not an incumbent carrier, 
the petitioner shall submit the foregoing materials to the extent available.

   c. Any conditions which the responding party requests be imposed.

   d. A proposed schedule for implementation of the terms and conditions by the 
parties to the agreement.




   e. The petition may include a recommendation as to any information which 
should be requested from the parties by the arbitrator pursuant to Section 
252(b)(4)(B). The recommendation should state why the information is necessary 
for the arbitrator to reach a decision on the unresolved issues.
 
   f. At the party’s option, a proposed interconnection agreement may be 
submitted.

   g. Any other documents relevant to the dispute, including copies of all 
documents in their possession or control on which they rely in support of their 
positions or which they intend to introduce as exhibits at the hearing.  

  3.  All responses and accompanying documentation shall be verified as 
provided by WAC 480-09-425, or submitted by affidavit.

Confidentiality

  1.  Petitions, responses, accompanying material, and any documents provided 
to the Commission pursuant to a request under Section 252(b)(4)(B) are subject 
to the Washington public disclosure law.  Confidential information submitted 
with a petition for arbitration or response is subject to the protections and 
procedures set out in WAC 480-09-015. A petition or response may include a 
request for issuance of the Commission’s standard protective order patterned 
after the protective order issued in Docket No. UT-901029, In the Matter of the 
Application of ELECTRIC LIGHTWAVE, INC., for an Order Authorizing Registration 
of Applicant as a Telecommunications Company.  

Discovery

  1.  Parties shall cooperate in good faith in the voluntary, prompt and 
informal exchange of all documents and other information relevant to the 
disputed issues, subject to claims of privilege or confidentiality. Parties 
shall exchange copies of all documents relevant to the dispute, including those 
on which they rely in support of their position or which they intend to 
introduce as exhibits.

  2.  A discovery conference shall be scheduled as a matter of course for a 
date 10 days after the deadline for responses to the petition for arbitration. 
The purpose of the conference will be to review the need for any remaining 
discovery, including requests or additional requests for information by the 
arbitrator pursuant to 47 USC § 252(b)(4)(B).  Any party-to-party discovery 
requests not responded to may be submitted to the arbitrator at the conference, 
with a request that the arbitrator order the discovery. The request should 
include an explanation of why the information is necessary to reach a decision 
on the unresolved issues. This provision shall not limit the right of the 
arbitrator or Commission to request information from the parties at any time 
pursuant to 47 USC § 252(b)(4)(B).     

  3.  Any failure to cooperate in discovery may be treated as a failure to 
negotiate in good faith under the Act. 47 USC §§ 251(c)(1),  252(b)(5)

Appointment and Authority of Arbitrator; Model Procedural Order

  1.  Arbitrations will be conducted by arbitrators appointed by the 
Commission. Arbitrations may be conducted by the Commission, a single 
Commissioner, or by Commission employees.  The Commission will not appoint an 
arbitrator who previously conducted a mediation between the same parties on the 
same interconnection agreement, unless the parties consent, except where no 
other arbitrator is available to the Commission. The parties will be advised of 
the appointment in the Order On Arbitration Procedure (See paragraph 3 below). 
The Commission may, at its discretion, permit parties to comment on the 
selection of the arbitrator.

  2.  The arbitrator will exercise all authority reasonable and necessary for 
the conduct of  the arbitration subject to the provisions of this interpretive 
order and the Order On Arbitration Procedure, and other provisions of law.

  3.  Upon the filing of a petition for arbitration, the Commission will enter 
and serve on the parties to the arbitration a procedural order.  The order will 
be substantially the same in form and content as the Model Order on Arbitration 
Procedure attached to this interpretive statement  as Appendix A.    

  4.  The Commission or  the arbitrator, in its discretion and to the extent 
practical, may consolidate proceedings under the Telecommunications Act of 
1996  in order to reduce administrative burdens on telecommunications carriers, 
other parties to the proceedings, and the Commission.

  5.  The arbitrator may employ the assistance of other members of the 
Commission Staff in reviewing the petition and accompanying materials, to the 
extent such staff member has not acted as a mediator with respect to the same 
interconnection agreement between the same parties.   

  6.  The arbitrator will be authorized to  announce a resolution of the 
disputed issues, and any appropriate conditions to be imposed in the form of an 
Arbitrators Report.  The Commission resolution will be concluded not later than 
9 months after the date on which the local exchange carrier received the 
request to negotiate under Section 252.

Fees and Costs

  1.  Each party shall be responsible for bearing its own fees and costs. Each 
party shall pay any fees imposed by Commission rule or statute.



D.  Existing Interconnection Agreements

  The 1996 Act provides that, if parties voluntarily negotiate an agreement, 
the agreement, including any agreement negotiated before the enactment of the 
Act, shall be submitted for approval.  47 USC § 252(a)(1).  The Commission does 
not interpret the 1996 Act as creating a blanket requirement  that incumbent 
LECs produce all existing interconnection agreements of whatever type and 
vintage and seek approval for the agreements under 47 USC § 252(e).   Companies 
may be required to produce existing agreements in the context of arbitrations 
on a case-by-case basis, to the extent the agreements are relevant to the 
issues in the arbitration. 


III. APPROVAL OF AGREEMENTS

Filing and Service of Agreements for Approval

  1.  An interconnection agreement shall be submitted to the Commission for 
approval under Section 252(e) within 30 days after the issuance of the 
Arbitrators’s Report, in the case of arbitrated agreements,  or, in the case of 
negotiated agreements, within 30 days after the execution of the agreement.  
The 30 day deadline may be extended by the Commission for good cause.   The 
Commission does not interpret the 9 month time line for arbitration under 
Section 252(b)(4)(C) as including the approval process.
 
  2.  Requests for approval shall be filed with the Secretary of the Commission 
in the manner provided for in WAC 480-09-120.  In addition, the request for 
approval shall be served on all parties who have requested service (See Sec. 
II.A.2 above) by delivery on the day of filing.  The service rules of the 
Commission set forth in WAC 480-09-120 and 420 apply except as modified in this 
interpretive order or by the Commission or arbitrator.  Unless filed jointly by 
all parties, the request for approval and any accompanying materials should be 
served on the other signatories by delivery on the day of filing.

  3.  A request for approval shall include the documentation set out in this 
paragraph.   The materials can be filed jointly or separately by the parties to 
the agreement, but should all be filed by the 30 day deadline set out in 
paragraph 1 above.
 
  Negotiated Agreements

   a. A “request for approval” in the form of a brief or memorandum summarizing 
the main provisions of the agreement, setting forth the party’s position as to 
whether the agreement should be adopted or modified, including a statement as 
to  why the agreement does not discriminate against non-party carriers,  is 
consistent with the public interest, convenience, and necessity, and is 
consistent with applicable state law requirements, including Commission 
interconnection orders.
  
   b. A complete copy of the signed agreement, including any attachments or 
appendices.

   c. A proposed form of order containing findings and conclusions.

  Arbitrated Agreements

   a. A “request for approval” in the form of a brief or memorandum summarizing 
the main provisions of the agreement,  setting forth the party’s position as to 
whether the agreement should be adopted or modified;  and containing a separate 
explanation of the manner in which the agreement meets each of the applicable 
specific requirements of Sections 251 and 252, including the FCC regulations 
thereunder, and applicable state requirements, including Commission 
interconnection orders. The “request for approval” brief may reference or 
incorporate previously filed briefs or memoranda. Copies should be attached to 
the extent necessary for the convenience of the Commission.

   b. A complete copy of the signed agreement, including any attachments or 
appendices.

   c. Complete and specific information to enable the Commission to make the 
determinations required by Section 252(d) regarding pricing standards, 
including but not limited to supporting information for (1) the cost basis for 
rates for interconnection and network elements and the profit component of the 
proposed rate. (2) transport and termination charges; and (3) wholesale 
prices.   

   d. A proposed form of order containing findings and conclusions.

  Combination Agreements (Arbitrated/Negotiated)

   a. Any agreement containing both arbitrated and negotiated provisions shall 
include the foregoing materials as appropriate, depending on whether a 
provision is negotiated or arbitrated. The memorandum should clearly identify 
which sections were negotiated and which arbitrated.

   b. A proposed form of order is required, as above.

  4.  Any filing not containing the required materials will be rejected and 
must be refiled when complete. The statutory time lines will be deemed not to 
begin until a request has been properly filed.




 
Confidentiality

  1.  Requests for approval and accompanying documentation are subject to the 
Washington public disclosure law, including the availability of protective 
orders.  The Commission interprets 47 USC § 252(h) to require that the entire 
agreement approved by the Commission must be made available for public 
inspection and copying.   For this reason, the Commission will ordinarily 
expect that proposed agreements submitted with a request for approval will not 
be entitled to confidential treatment.

  2.  If a party or parties wishes protection for appendices or other materials 
accompanying a request for approval, the party shall obtain a resolution of the 
confidentiality issues, including a request for a protective order and the 
necessary signatures (Exhibits A or B to standard protective order) prior to 
filing the request for approval itself with the Commission.

Approval Procedure

  1.  The request will be assigned to the Commission Staff for review and 
presentation of a recommendation at the Commission public meeting.  The 
Commission does not interpret the approval process as an adjudicative 
proceeding under the Washington Administrative Procedure Act. Staff who 
participated in the mediation process for the agreement will not be assigned to 
review the agreement.  

  2.  Any person wishing to comment on the request for approval may do so by 
filing written comments with the Commission no later than ten days after date 
of request for approval. Comments shall be served on all parties to the 
agreement under review. Parties to the agreement file written responses to 
comments within seven days of service.  

  3.  The request for approval will be considered at a public meeting of the 
Commission.   Any person may appear at the public meeting to comment on the 
request for approval.  The Commission may in its discretion set the matter for 
consideration at a special public meeting.

  4.  The Commission will enter an order, containing  findings and conclusions, 
approving or rejecting the interconnection agreement within thirty days of 
request for approval in the case of arbitrated agreements, or within 90 days in 
the case of negotiated agreements. Agreements containing both arbitrated and 
negotiated provisions will be treated as arbitrated agreements subject to the 
30 day approval deadline specified in the Act. 

Fees and Costs

  1.  Each party shall be responsible for bearing its own fees and costs. Each 
party shall pay any fees imposed by Commission rule or statute.


IV.  PREFERRED OUTCOMES FOR WASHINGTON
  INTERCONNECTION AGREEMENTS

  The Commission and WECA have several ongoing dockets relating to local 
competition, interconnection, and number portability.  In addition, the recent 
U S WEST rate order established principles designed to advance local 
competition and required U S WEST to take certain actions to that end .  These 
efforts to develop and foster local competition will continue. The procedures 
and policies contained in this interpretive statement are intended to 
supplement and not replace existing Washington initiatives. 

  In its consolidated interconnection proceedings, the Commission has already 
adopted a number of fundamental principles which will be applicable to 
interconnection agreements  under 47 USC § 252. In order to assist parties in 
the process of negotiating agreements, a list of “preferred outcomes” for 
interconnection agreements, based on requirements adopted by the Commission,  
is set out in this interpretive statement in Appendix B.  The preferred 
outcomes statement is intended only as a summary of existing Commission orders 
on interconnection and does not in any way alter or supersede the provisions of 
the orders themselves.

  DATED at Olympia, Washington and effective this      day of June 1996.

WASHINGTON UTILITIES AND TRANSPORTATION COMMISSION



       SHARON L. NELSON, Chairman



       RICHARD HEMSTAD, Commissioner



       WILLIAM R. GILLIS, Commissioner