BEFORE THE WASHINGTON UTILITIES AND TRANSPORTATION COMMISSION In the Matter of the Pricing proceeding for Interconnection, Unbundled Elements, Transport and Termination, and Resale .....................................................................…... .. In the Matter of the Pricing Proceeding for Interconnection, Unbundled Elements, Transport and Termination, and Resale for U S WEST COMMUNICATIONS, INC. ………………………………………………….. In the matter of the Pricing Proceeding for Interconnection, Unbundled Elements, Transport and Termination, and Resale for GTE NORTHWEST INCORPORATED _______________________________________ ) ) ) ) ) ) ) ) ) ) ) ) ) ) PHASE II DOCKET NOS. UT-960369, UT-960370, UT-960371 U S WEST’S TESTIMONY SUMMARY (WITH REFERENCE TO THE ISSUES LIST) Pursuant to the requirements of the Commission's and the Administrative Law Judge’s Orders in this matter, U S WEST is providing the following summary of its testimony. The issues identified in the Issues List are cross referenced. U S WEST has filed the testimony of three witnesses. Marti M. Gude addresses avoided cost issues, Dean W. Buhler addresses transition costs, and Mark S. Reynolds addresses all of the other issues in this docket. However, on October 9, 1998, U S WEST will file the testimony of two additional witnesses, addressing collocation cost and technical issues. One of those witnesses will adopt the physical collocation testimony filed to date by Mark Reynolds. A testimony summary will accompany that filing. Marti M. Gude addresses the issues in Order Section VIII., Avoided Costs. Ms. Gude’s testimony proposes an avoided cost discount for resold operator services and directory assistance of 6.90%, addressing issue VIII-1. Ms. Gude discusses why the avoided cost discount calculation should be done with avoided costs as the numerator and total costs as the denominator. Recognizing that the Commission has previously ordered that the calculation be performed with avoided costs as the numerator and total revenues as the denominator, Ms. Gude also performs that calculation, resulting in a 7.97% discount. Dean W. Buhler addresses the issues in Order Section IV., Transition Costs. Mr. Buhler’s testimony describes how U S WEST has incurred and will continue to incur start-up costs to change its operational support systems and develop electronic interfaces to support local competition. Many changes to U S WEST’s operational support systems are needed. New interfaces have been built that will allow CLECs’ employees to communicate with U S WEST’s operational support systems in the categories of pre-ordering, ordering, maintenance and repair. This work is being undertaken by regulatory mandate for the benefit of CLECs. Pursuant to the Telecommunications Act of 1996, U S WEST is entitled to recover these costs. The amount estimated to be recovered for Washington is $18,868,000, which constitutes the actual costs incurred during 1997 and the estimated costs for 1998 and 1999 for development of the human-to-computer and computer-to-computer interfaces and modifications to U S WEST’s operational support systems. U S WEST proposes to recover the costs of providing the maintenance and operations of the human-to-computer and computer-to-computer interfaces in a per order charge of $2.49, billed on a monthly basis. U S WEST proposes to recover the start-up costs related to deploying the human-to-computer and computer-to-computer interfaces and enhancing its OSSs in an interim per order charge of $14.91, billed on a monthly basis. Mr. Buhler’s rebuttal testimony responds to the intervenors in this docket, who criticize U S WEST’s OSS development achievements and corresponding costs. U S WEST has modified, developed and maintained, and will continue to modify, develop and maintain OSS capabilities to support CLECs according to the requirements of the Act and subsequent FCC orders. These capabilities allow U S WEST to provide nondiscriminatory access to its OSS. The costs incurred in modifying, developing and maintaining OSS are legitimate and extraordinary and are justifiably recoverable pursuant to Section 252(d). These costs are based on TELRIC methodology. U S WEST’s tracking structure provides a level of detail which establishes that U S WEST has incurred these costs and that they are proper expenditures. Because CLECs are the cost causers and benefit solely from OSS development capabilities, the CLECs should pay those costs. Mr. Buhler’s testimony responds to the issues as follows: Issue IV-1 (Legal): Does the 96 Act require the Commission to provide for recovery of all “transition” costs which an ILEC incurs in complying with the Act? U S WEST believes that the Act and the 8th Circuit Court’s opinions interpreting the Act require the Commission to allow U S WEST to recover the costs it incurs to comply with the regulatory mandate to modify its systems and to develop electronic interfaces. Only the CLECs benefit from these systems modifications and electronic interfaces, and it is therefore appropriate that the CLECs should bear the costs associated with them. Issue IV-2 (Legal): If the answer to Issue IV-1 is yes, does the Act allow the Commission to apply the wholesale discount to an ILEC’s transition costs? This is a legal issue, requiring interpretation of the Act. Pursuant to Section 251(c)(4), only retail telecommunications services must be discounted. The charges proposed to recover U S WEST’s transition costs are not charges for retail telecommunications services and are therefore not subject to the discount. Issue IV-3 (Legal): If the answer to Issue IV-1 is no, to what extent may the Commission provide for recovery of ILEC transition costs? Issue IV-4 (Policy): If the answer to Issue IV-3 is yes, to what extent should the Commission provide for recovery of ILEC transition costs in this proceeding? The Commission should allow for full recovery of these costs – to do otherwise would run afoul of the provisions of the Act. However, U S WEST has suggested that the Commission may wish to extend the recovery period, thereby lowering the per order charge. This approach would be acceptable to U S WEST, if the Commission determines as a matter of policy that recovery is appropriate over a longer period of time. Issue IV-5 (Factual/Methodological): If the Commission decides under Issue IV-4 that it should provide for recovery, what are U S WEST’s and GTE’s transition costs? Issue IV-6 (Methodological): If the Commission decides under Issue IV-4 that it should provide for recovery, what is the most appropriate recovery mechanism? U S WEST’s transition costs are separately identified as (1) start-up costs related to modifying existing systems and creating new systems, and (2) ongoing maintenance and operations costs of the electronic interfaces. The first set of costs represents the actual start-up costs incurred in 1997, 1998 to date, and estimated costs through the end of 1999. The total was divided by the estimated number of CLEC orders for that period, to produce a per-order charge of $14.91. The second set of costs reflects an estimate of the 1999 operations and maintenance costs, divided by the estimated number of CLEC orders. This produces a per-order charge of $2.49 through the end of 1999, at which time the charge should be re-evaluated. Mark S. Reynolds addresses the remaining issues in this docket, with the exception of physical collocation as noted above. Mr. Reynolds filed direct, responsive, and rebuttal testimony, on July 9, August 20, and September 4, 1998. This testimony addresses the proper pricing of UNEs, the pricing of interim local number portability, the issues of transport and termination pricing, the customer transfer charge, and U S WEST’s non-recurring charges. The direct testimony addresses U S WEST’s UNE pricing advocacy and provides supporting documentation for the UNE rates that U S WEST filed on June 12, 1998. U S WEST utilizes an equal percentage mark-up pricing advocacy based on a percentage mark-up which was developed based on the average contribution from retail services, certain avoidable costs, and a recognition of certain other competitive costs. Other UNE related costing and pricing issues which are also addressed include the specific adjustments that U S WEST made to its nonrecurring cost studies to be in compliance with the 8th Supplemental Order (i.e., loop conditioning, unbundled loops, and other related UNE NRCs - see Exhibit MSR-3). U S WEST is not seeking a mark-up, above its “adjusted” TELRIC and common costs for nonrecurring charges. All UNE costs and prices are displayed in Exhibit MSR-2. The direct testimony also provides U S WEST’s responses to a number of attendant issues that were referenced in the 8th Supplemental Order. Specifically, the testimony provides U S WEST’s support for a bill and keep compensation scheme for interconnection, but recommends that ISP traffic not be included in this compensation as it is not local traffic. Mr. Reynolds’ responsive testimony addresses the testimony of Arlene Starr and Page Montgomery. This testimony reiterates U S WEST’s analysis of and support for its proposed mark-ups, and explains how U S WEST properly calculated attributed and common costs for all elements. In addition, the testimony explains that costs for interim local number portability should not be recovered in the same manner as for long term number portability, because the types of costs are very different from each other. The rebuttal testimony addresses all of the pricing issues as they were raised by others in the August 20, 1998 testimony. Thus, this testimony addresses the need to assign proper levels of common costs to UNEs, and to price UNEs in a way that is consistent with the cost/price relationship that exists in U S WEST’ s retail rates, ensuring that all customers contribute equitably to the common costs of the network. This is consistent with Staff’s recommendations, and rebuts the contentions of Dr. Zepp and others that CLECs should not contribute to those costs. This testimony also rebuts Dr. Zepp’s contentions about the proper cost of the 4-wire loop – U S WEST supports a cost of 182% of the 2-wire loop. The rebuttal testimony also explains, again, how U S WEST’s non-recurring cost studies are consistent with the Commission’s earlier orders, including U S WEST’s cost and pricing proposal for loop unloading. This proposal recovers the cost of unloading from all of the loops which request the activity. The testimony also explains how the cost for unloading is not recovered in the maintenance factor, as some parties suggest. The rebuttal testimony states U S WEST’s opposition to different loop prices, depending on whether the loop is unbundled or not. The testimony reiterates that U S WEST supports reciprocal compensation for local (not ISP) traffic, but that a flat rated capacity charge is not necessary, because such a charge is already offered, and is mandated by interconnection agreements in certain circumstances. The rebuttal addresses the CTC, supporting some of Staff’s proposed modifications, and the pricing for interim local number portability, explaining why the price should be established according to U S WEST’s proposal, and why the NRC should not be reduced 50%. Finally, the rebuttal testimony addresses Covad’s proposal to share bandwidth on the loop instead of purchasing the loop as a UNE. Covad’s proposal is inconsistent with the FCC’s definition of an unbundled loop, is not permitted by the FCC’s order, and is not permitted by Covad’s interconnection agreement. Order Section V — Element Costs Issue V.1 (Legal): Does the 96 Act require the Commission to provide for recovery of all of an ILEC’s “actual costs” through UNE Prices? Issue V.2 (Legal): Does the 96 Act allow the Commission to provide for interim recovery of universal service costs through UNE prices? Issue V.3 (Policy): If the answer to Issue V.2 is yes, to what extent should the Commission to provide for interim recovery of universal service costs through UNE prices? U S WEST has not specifically advocated recovery of “actual” costs through UNE prices, nor has U S WEST advocated interim recovery of universal service costs through UNE prices. However, U S WEST does believe that all customers should contribute to the common costs of the network on an equitable basis, including UNE customers. To this end, U S WEST has added 4.05% to the TELRIC for each UNE (except the loop, which must be marked up for both attributed and common costs) and then has added an 18% mark-up to reflect a contribution comparable to that provided by U S WEST’s retail services. Issue V.4 (Policy): To what extent should the Commission provide for recovery of Direct Costs through UNE prices? U S WEST proposes that TELRIC costs, including attributable, and appropriate amounts of common costs, be the threshold for price determinations. U S WEST re-ran its cost analyses using the Commission’s required cost-of-money and depreciation lives in order to determine an appropriate cost basis for price determinations. The Commission should provide for recovery of direct costs in all cases, as there is no basis in law or economics to deny recovery of direct costs for UNEs in the prices for those elements. Issue V.5 (Legal): If the answer to Issue V.1 is no, does the 96 Act require the Commission to provide for recovery of all of an ILEC’s common costs through UNE Prices? Issue V.6 (Policy): If the answer to Issue V.5 is no, to what extent should the Commission provide for recovery of common costs? If these issues address the question of whether all of the common costs of the entire firm should be recovered through UNE prices, and no common costs assigned to retail services, U S WEST does not agree and has not advocated this position. The very nature of common costs is that they are not assignable to any particular product or service. Thus, it is U S WEST’s position that UNEs should bear an appropriate share of common costs, but not all of the common costs of the firm. Issue V.7 (Factual/Methodological): If the Commission must or should provide for recovery of common costs, what are GTE’s common costs? U S WEST does not have a position on what GTE’s common costs are. U S WEST’s own common costs are set forth in MSR-2. In performing TELRIC studies, U S WEST has been able to directly attribute costs which, on a service cost analysis, would have been considered shared. Thus, U S WEST’s results show common costs of 4.05 % once all of the attributable costs have been properly attributed to individual elements. This is consistent with what the FCC stated it expected would occur with regard to shared and common cost levels in a TELRIC as opposed to a TSLRIC analysis. Issue V.8 (Factual/Policy): To what extent is Staff’s 20% markup for attributable costs appropriate? U S WEST believes that Staff based its 20% estimate on U S WEST’s estimates for its attributed and common costs. Staff used this estimate to allocate attributed and common costs to UNE elements in the Hatfield Model. U S WEST has used Staff’s 20% estimate as one data point in calculating attributed/common costs for the Hatfield model portion of the Commission’s loop cost estimate. U S WEST recommends a $23.04 loop price, based on a TELRIC and common costs of $19.53 ($17.00 + $2.53 average attributed and common) and the equal percentage mark-up of 1.18, previously described. The attributed and common cost determination of $2.53 is based on a 14.86% attributed and common cost average developed from the data points which the Commission used to establish the baseline $17.00 unbundled loop costs. Specifically, U S WEST averaged Staff’s recommended 20% attributed/common factor for Hatfield, BCPM’s recommended 20.53% attributed/common factor for BCPM and U S WEST’s 4.05% common factor from RLCAP (U S WEST’s attributable costs were already included in the data point estimate) to arrive at an average 14.86% factor. U S WEST does not use this percentage in any other calculation, but rather uses its own attributed/common factor. Issue V.9 (Policy): to what extent should the Commission provide factor market share loses, or other competitive loses, into UNE prices? U S WEST does not advocate that market share losses or other competitive losses must be factored into the price of UNEs. Appropriate cost methodology, as discussed in Phase I, will incorporate an appropriate demand or fill factor to compute unit costs. This factor is required to be a reasonable projection of actual average fill, and, as such, should factor in the possibility that there will be multiple providers and that carriers might therefore experience lower fill on the network. However, once cost is properly calculated, there should not necessarily need to be an additional factor in the pricing decision. Issue V.10 (Policy): To the extent the Commission decides to provide for recovery of more than the direct cost of UNEs, should the Commission adopt a uniform markup or a percentage that varies by UNE? U S WEST proposes that lacking any meaningful wholesale market data (i.e., measures of elasticity of demand), due to the relatively nascent stage of the interconnection/UNE elements, pricing for wholesale interconnection/UNE elements should employ an equal percentage mark-up to a pre-defined margin. U S WEST recommends that this mark-up be based, in part, on the average margin over the TELRIC-based costs ordered in this docket, including common, for U S WEST’s core services (i.e., exchange services, toll, and access). The mark-up should be appropriately adjusted to allow for avoidable costs and an allowance for recombination costs. This will ensure that, on the average, both retail and wholesale customers provide equitable contributions for using U S WEST’s network services, but also allows CLECs the opportunity to cover their marketing, billing, and recombination costs and still earn a reasonable return. U S WEST recommends a conservative UNE recurring rate element mark-up of 1.18 based on the margin analysis presented in Exhibit MSR-1. Based on the Commission’s explicit instructions regarding nonrecurring costs, U S WEST does not apply the 1.18 mark-up to the nonrecurring elements, but does recommend that the rates for these elements recover all relevant costs, including common costs. Issue V.11 (Policy): To what extent should the Commission provide for recovery of “conditioning” (i.e. removal of load coils and bridge taps)? Issue V.12 (Methodology): If the Commission resolves Issue V.11 by providing for cost recovery, what is the most appropriate cost recovery mechanism? U S WEST agrees with the Commission’s order that loop conditioning costs are incurred to satisfy the requirements of a particular end user and that it is appropriate to recover those costs from the cost-causer (8th Supp. Order at para. 155). U S WEST’s loop conditioning costs have been recalculated with the following adjustments: - reduce technician work time at splice locations from 160 to 120 minutes, - reduce plant engineering design time from 3 hours to 60 minutes, - remove common costs (common cost recovery is to be decided in Phase II), - change study assumption of bridged tap removal at 3 locations to 1 location. In conformance with the provisions of the Order, U S WEST has recalculated the cost of the loop conditioning element intended to remove load coils at a TELRIC cost of $292.28. This is the cost for removing load coils for a 25 pair binder group, regardless of the number of loops desired to be unloaded. Furthermore, this cost does not include common costs, and is for removal of load coils only. In accordance with the Order, U S WEST has separately calculated the cost of bridged tap removal at a single location to be a TELRIC cost of $141.63. The removal of bridged tap will be a separate cost and rate element that will apply when only bridged tap is required to be removed. In situations where both load coils and bridged tap are to be removed for the same job, only the load coil nonrecurring charge will apply. U S WEST proposes nonrecurring charges for load coil removal and bridge tap removal of $304.12 and $147.34, respectively. These rates are based on TELRIC costs plus common costs of $11.84 and $5.74, respectively. X. Local Number Portability Issue X-1 (Policy): What is the most appropriate cost recovery method for recovering interim local number portability (INP)? Issue X-2 (Policy): If the Commission resolves Issue X-1 by requiring or allowing LECs to charge other LECs for INP, to what extent should the Commission require the LEC providing INP to pay any interexchange access charges for the call to the LEC paying for INP? U S WEST’s position is that the most appropriate cost recovery mechanism, based on the Commission-established costs, is a charge per-path, per month, to the CLEC requesting the interim number portability. U S WEST does not believe that access charge sharing is an issue to be resolved in this proceeding, as the parties’ interconnection agreements address this issue, and it is not a pricing issue. XI. Transport & Termination Issue XI-1 (Policy): What is the most appropriate recovery mechanism for unbundled interoffice transport? In response to the Order’s request for comments on “bill and keep” vs. reciprocal compensation, U S WEST reiterates its advocacy that reciprocal compensation is the only economic, cost-based, form of compensation for use of network facilities. Indeed, as outlined in MFS’s Comments on Petitions for Reconsideration/Clarification, it is clear that reciprocal compensation is required by the Act. U S WEST does not believe, however, that reciprocal compensation should apply to traffic destined for Information Service Providers (internet traffic), because most of this traffic is not local traffic and thus should not be subject to local call termination charges. The issues associated with the treatment of ISP traffic, with respect to reciprocal compensation, including the status of the existing access charge exemption for such traffic, are discussed in Mr. Reynolds’ testimony Finally, U S WEST respectfully disagrees with the Order that all “…transport compensation is handled through a bill-and-keep procedure” and, thus, “[u]nder the bill-and-keep arrangement, there is no need to quantify the cost of transport” (8th Order, at paragraph 443). Other than standard interconnection call termination, transport UNEs are also required to terminate CLEC traffic which originated from an analog switch line port UNE. U S WEST has provided costs and prices for these elements in MSR-2. XII. Nonrecurring Costs Issue XII-1 (Factual): Do the UNE nonrecurring cost studies which U S WEST filed on May 18, and revised on June 19, 1998, and GTE filed on May 19, and revised on June 5, 1998, comply with the Commission’s Eighth and Ninth Supplemental Orders? U S WEST’s non-recurring cost studies are fully compliant with the Commission’ s orders. These orders require U S WEST to revise all of its nonrecurring cost studies to be consistent with the principles stated by the Commission regarding the required adjustments to the unbundled loop (LIS-LINK) nonrecurring cost study (Order, ¶ 474). The Commission required that the unbundled loop nonrecurring costs be recalculated with the following adjustments; - reduce ISC order processing work time on the initial order from 45 minutes to 6 minutes, - reduce the probability that a link order will require manual plant line assignment from 45% to 15%, - modify the disconnection segment of the study to reflect 6 minutes of ISC, 2 minutes of central office frame, and 3 minutes for removal of jumper, - remove common costs (common cost recovery is to be decided in Phase II). U S WEST has filed studies consistent with the Commission’s recalculation of the basic unbundled loop nonrecurring cost (including disconnection costs, but without attributed and common costs) at $41.73. U S WEST proposes a nonrecurring charge for basic installation of an unbundled loop of $51.94. This rate is based on the $41.73 direct cost and attributed and common costs of $10.21 (8.19 attributed + $2.02 common). In accordance with the Order, at paragraph 474, U S WEST adjusted its other nonrecurring studies in a manner consistent with the Commission’s directives on the unbundled loop study. Exhibit MSR-3 is a summary of the adjustments made to U S WEST’s nonrecurring cost studies as directed by the Order. Issue XII-2 (Policy): To what extent should the Commission facilitate competitive entry by requiring ILECs to recover nonrecurring UNE costs on a recurring basis? U S WEST disagrees with recovery of non-recurring UNE costs on a recurring basis. Costs should be recovered in the same manner in which they are incurred (Tr. at 2413). When U S WEST performs a one-time activity associated with interconnection or UNEs, U S WEST incurs an up front cost to which it is reasonably entitled recovery. Recovery delayed may be recovery denied, if cost recovery is allowed only on a recurring charge basis. For example, if U S WEST incurs $1,000 in non-recurring costs, and is required to recover those costs through recurring charges that extend recovery over a period of two years, U S WEST only recovers those costs if the element or function is purchased for the full two-year period. If the CLEC discontinues service after only a year, U S WEST has incurred 100% of the cost, but has only recovered 50%, with no opportunity to ever recover the remaining 50%. Thus, this outcome is not pro-competitive, as it sends distorted cost and pricing signals to CLECs about the true cost of market entry. Issue XII-3 (Policy): To what extent should an ILEC recover the costs of “turning up” additional channels once a transport facility is in place? Issue XII-4 (Policy): To the extent the Commission resolves Issue XII-3 by requiring or allowing cost recovery, what is the best cost recovery mechanism? In this proceeding, U S WEST has not filed any nonrecurring costs associated with changing configurations or turning up additional channels once a transport facility is in place. However, U S WEST maintains that it is entitled recovery of such costs should the situation arise, just as it entitled to recovery of other non-recurring costs. Issue XII-5 (Factual): What nonrecurring costs do U S WEST and GTE incur in separating an unbundled port from unbundled switching? Issue XII-6 (Policy): What is the appropriate cost recovery mechanism for the cost of separating the loop and the switch? U S WEST’s testimony addresses the requirement in the 8th Supplemental Order that the parties address how the cost of separating the loop and the switch should be recovered. The Order also requires the parties to address the appropriateness of having new entrants pay for costs that are due to potential network inefficiencies associated with unbundling the port and the switch. Specifically, parties are to address whether the cost causer for collocation connections is the CLEC, due to ordering of network elements, or the ILEC, due to its refusal to bundle network elements. U S WEST’s response is that the Act is clear that ILECs are required to provide access to unbundled network elements (UNE). Additionally, the 8th circuit clarifies that the Act does require ILECs to provide UNEs available for recombination by the CLECs, but does not require ILECs to recombine the UNEs for the CLECs. U S WEST’s TELRIC studies provide the costs for unbundled network elements. These elements are costed on an individual, unbundled basis. Thus, any costs associated with providing elements unbundled from other elements, or efficiencies lost due to not bundling elements, are properly reflected in U S WEST’s TELRIC studies. In accordance with the Act, U S WEST is entitled to recover its costs in association with interconnection and the provisioning of UNEs. Accordingly, U S WEST is entitled to recovery of connection between CLEC collocation cages and UNEs. Finally, if CLECs are interested in bundled retail services, they are available at a wholesale discount which was determined in this instant proceeding. Any attempts by CLECs to require recombinations of UNEs, in order to obtain lower prices than would be available through the resale discounts, essentially render the resale provisions of the Act meaningless and are counter to the 8th Circuit decision. Issue XII-7 (Policy): Should the Commission require separate charges for connection and disconnection? No. U S WEST does not believe that the Commission’s statement regarding the cost of disconnection constituted a requirement that U S WEST split the nonrecurring loop charge into charges for connection and disconnection. U S WEST does not recover any of its other nonrecurring charges on this basis. The $41.73 non-recurring cost that U S WEST filed is contained on page 2 of Exhibit MSR-2. The rate of $51.94 is consistent with the TELRIC cost ordered by the Commission, and contains an appropriate share of attributed and common costs. XIV. Findings Section Issue XIV-1 (Factual): Are U S WEST’s and GTE’s resale customer transfer cost estimates reasonable? Issue XIV-2 (Policy): Should the Commission allow ILECs to recover customer transfer costs through a non-recurring charge? U S WEST answers both of these questions in the affirmative. U S WEST’s CTC is a cost-based nonrecurring charge to recover costs associated with the transfer of U S WEST retail customers to resellers. U S WEST’s Phase I CTC cost analysis contained two distinct components; the loaded labor costs associated with processing the order and an amortized recovery of the cost of system changes necessary to process reseller orders through U S WEST’s operating support systems. In its rebuttal testimony, U S WEST concurs with Staff’s recommendation for a new rate structure for the CTC, eliminating the distinction between business and residence customers and adding separate CTCs for private line and frame relay. However, U S WEST disputes Staff’s proposed adjustments to exclude the system cost and to reduce the order processing time. The time estimates are based on actual representations of the individuals managing the ordering and implementation activities and should not be arbitrarily reduced. Compliance Filings Issue CF-1 (Factual/Legal): Are the terms and conditions for in the tariffs U S WEST and GTE in compliance with the Commission’s 8th and 9th Supplemental Orders in this proceeding consistent with those orders, federal law, and state law? Issue CF-2 (Legal/Policy): What relationship, if any, exists between the terms and conditions in these tariffs and negotiated o