BEFORE THE WASHINGTON UTILITIES AND TRANSPORTATION COMMISSION


In the Matter of the Pricing proceeding for Interconnection, Unbundled 
Elements, Transport and Termination, and Resale
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In the Matter of the Pricing Proceeding for Interconnection, Unbundled 
Elements, Transport and Termination, and Resale for U S WEST COMMUNICATIONS, 
INC.
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In the matter of the Pricing Proceeding for Interconnection, Unbundled 
Elements, Transport and Termination, and Resale for GTE NORTHWEST INCORPORATED	)
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		DOCKET NO.  UT-960369
		
		DOCKET NO.  UT-960370
		
		DOCKET NO.  UT-960371
		
		
		U S WEST’S PETITION FOR CLARIFICATION AND RECONSIDERATION


 U S WEST Communications, Inc. (U S WEST) hereby files this motion for 
clarification of the 8th Supplemental Order entered in this matter on April 16, 
1998.  Pursuant to the notice at the end of the order, U S WEST recognizes that 
the Commission will accept limited motions of this nature to clarify the order 
or to correct errors of fact or law.  U S WEST believes that there are several 
areas in the 8th Supplemental Order which require clarification or 
reconsideration, as set forth below:
Cost of a 4-Wire Loop
 At pages 41 and 42 of the Order, paragraphs 189-195, the Commission discusses 
the cost of a 4-wire loop relative to the cost of a 2-wire loop.  The 
Commission concludes that the cost of a 4-wire loop is 25% greater than that of 
a 2-wire loop.  The Commission based this conclusion on GTE’s calculation that 
the cost is 50% greater, and on testimony offered by U S WEST regarding the 
incremental cost of providing an additional pair of wires to a subscriber, 
citing exhibit 117 at pages 27-31. 
 U S WEST believes that the conclusion that a 4-wire loop is only 25% more 
costly than a 2-wire pair is an error of fact and law which requires 
reconsideration.  U S WEST’s testimony in exhibit 117 does not support the 
conclusion that the incremental cost of an additional pair is only 5%.  In 
fact, U S WEST’s testimony was offered for the illustrative purpose of showing 
that the cost of the loop does not decrease significantly when a proper 
adjustment is made to fill factor.  It is important to note that the example 
given discussed only the incremental cost of the distribution cable, not the 
TELRIC of an entire loop, which is essentially what is being costed in a 4-wire 
loop.  
 4-wire loops are nothing more than two separate and distinct 2-wire loops 
provisioned together.  The Commission has established a cost per loop of $17, 
and each loop in the 4-wire pair appropriately carries that cost on a TELRIC 
basis.  The 25% increment allowed by the Commission does not represent TELRIC, 
but appears to be more of an incremental analysis. U S WEST respectfully 
requests that the Commission reconsider its analysis based on the above 
discussion, and modify its conclusion on the cost of the 4-wire loop.  
 Neither Hatfield nor BCPM calculate a cost for a 4-wire loop.  U S WEST’s 
study supports the conclusion that the cost is twice as much for a 4-wire loop 
as a 2-wire loop.  GTE’s study supports, at a minimum, a cost of one and a half 
times the 2-wire loop.  The Commission’s order on this issue should reflect 
that evidence.
Loop Costs
U S WEST seeks clarification and correction of the table on page 54.  The table 
reflects the results of Hatfield, BCPM and RLCAP after the changes described in 
the order were made, and then includes adjustments for which the Commission was 
unable to modify the models, with a description of the likely impact on loop 
cost.  The RLCAP column references four adjustments – fill factor, drop, 
calculation of unit costs, and structure sharing – and indicates that each one 
reduces the cost of the loop.  
 However, due to an apparent transcription error, these adjustments are the 
same as the adjustments to the GTE model on page 55.  In fact, all of the 
adjustments reference paragraphs in the order which discuss GTE’s model.  For 
example, the fill factor adjustment is stated to reduce cost 8.7%, referencing 
paragraph 185, which is a discussion of the GTE adjustment.  U S WEST further 
notes that the Commission was able to modify U S WEST’s model to adjust the 
fill factor (paragraph 181), so that a fill factor line in this table is 
probably not appropriate for RLCAP.  U S WEST simply requests clarification and 
correction of the table as appropriate to comport with the Commission’s 
findings.
Modification of Non-Recurring Cost Studies
 The Commission has required U S WEST to modify its nonrecurring studies to be 
consistent with the changes the Commission ordered to the nonrecurring study 
for the loop.  One of the changes is to reflect a reduction in work time 
estimates from 45 minutes to 6 minutes at the interconnection service center.  
The Commission discusses this change at paragraphs 466-468.  The Commission 
cites an apparent inconsistency between the time estimates contained in the 
study and the testimony of U S WEST’s witness.  
 It is correct that there is an inconsistency between the testimony at TR-2068 
and the study.  However, the 45 minute time estimate should not be reduced.  
What actually happened, and which is reflected in the cost studies, is that in 
the August study, the time estimate for the initial loop was 45 minutes, while 
the time estimate for each additional loop was zero.  This was found to be 
incorrect, and an incremental 6 minutes was input to the study for additional 
loops.  This reflects the fact that additional loops will require additional 
work time, while also reflecting the efficiencies of processing orders for more 
than one loop at a time for a single interconnector.  This was, unfortunately, 
not adequately explained either on the record or in U S WEST’s brief.  However, 
U S WEST believes that this explanation is consistent with the evidence of 
record and warrants reversal of the Commission-ordered reduction in work time.
Resale
 The Commission ordered a 14.69% discount on U S WEST’s retail services 
(paragraphs 498 and 530).  However, that calculation is expressly conditioned 
upon the assumption that the cost of capital and capital structure used were 
consistent with the most recent rate case (paragraph 410).  Because this 
assumption is incorrect, the discount rate should be recalculated to use the 
correct capital costs.  The correction is easily made to lines 18 and 19 of 
worksheet 4.  U S WEST has done so, and the resulting discount is 14.74%.
 U S WEST further seeks reconsideration and/or clarification on the use of 
revenues in the denominator for the calculation of the discount.  U S WEST did 
not present evidence on the proper revenue calculation because it was U S WEST’
s position that total costs should be used in the denominator.  However, as the 
Commission has decided to use revenues, U S WEST would suggest that the revenue 
amount should be adjusted to include imputed revenues, and should, at a 
minimum, include imputed directory revenues.  As noted by the Commission in 
paragraph 405, when it rejected the use of total costs in the denominator, “[t]
here is no indication that the costs included in U S WEST’s avoided cost study 
are consistent with the methods for determining costs which we established in 
the Company’s 1995 general rate increase case.  For example, it is not clear if 
U S WEST has yet made the appropriate adjustment for Yellow Pages.”  To be 
consistent with the 1995 rate case, revenues would have to reflect the imputed 
directory revenue.  U S WEST has recalculated the discount as follows with a 
directory imputation:  The 1995 directory imputation (reported on the A61-A) 
was $81.9 million.  Of that, $68.3 million (83%) is included as additional 
revenue in the denominator.  The 83% is the proportion of intrastate retail 
revenues to total revenues and is calculated from worksheet 1, line 7, columns 
(a) and (n).  Inclusion of this additional imputed revenue, with the capital 
cost correction discussed above, results in a discount of 13.59%.  U S WEST 
request that the Commission reconsider its calculation in light of this 
information.
 Finally, U S WEST seeks clarification of the effective date of the discount 
rate.  U S WEST currently has arbitrated agreements containing a range of 
discounts from 13.96% to 21%.  U S WEST will file tariff sheets on May 18, 
1998, reflecting a 14.74% discount (or 13.59% if so ordered), and requests that 
the Commission clarify that the rate is effective from that day forward.
 Respectfully submitted this lst day of May, 1998.

      U S WEST Communications, Inc.



           By:_______________________________
Lisa A. Anderl, WSBA No. 13236