ORDER NO. 95-1164

ENTERED 

THIS IS AN ELECTRONIC COPY

BEFORE THE PUBLIC UTILITY COMMISSION

OF OREGON

UM 766

DISPOSITION: COMMUNITY OF INTEREST FOUND

On June 21, 1995, customers in the Jewell telephone exchange filed a petition with the Commission requesting extended area service (EAS). The petition requested EAS between the Jewell exchange and the Astoria and Seaside telephone exchanges. A map of the affected exchanges is attached as Appendix A.

On July 28, 1995, the Commission staff (staff) filed testimony for Phase I, Community of Interest Determination. Based on a review of geographic and telephone usage information, staff concluded that the proposed Jewell/Astoria and Jewell/Seaside interexchange routes did not satisfy the Commission’s objective community of interest criteria set forth in Orders No. 89-815 and 92-1136. Staff's testimony is summarized in Appendix B, attached to this order and incorporated by reference.

On August 28, 1995, Hearings Officer Michael Grant issued a Proposed Order recommending that the EAS petition be dismissed based on staff’s findings. Petitioners subsequently requested an opportunity to establish, through demographic, economic, financial, or other evidence, that a community of interest exists between the two telephone exchanges.

On October 10, 1995, the Hearings Officer held a hearing on this matter in Jewell, Oregon. Approximately 60 people appeared in support of the petition. Based on a preponderance of the evidence submitted, the Commission makes the following:

FINDINGS OF FACT

Geography and Demography

The Jewell, Astoria, and Seaside telephone exchanges lie in northwest Oregon in Clatsop and Columbia counties. The petitioning exchange, Jewell, consists of approximately 580 access lines and currently has no EAS to any other exchange. The Astoria exchange lies northwest of Jewell and consists of approximately 6,770 access lines. It currently has EAS to the Knappa, Warrenton, and Seaside exchanges. The Seaside exchange lies west of Jewell and consists of approximately 6,150 access lines. It has EAS to the Warrenton, Astoria, and Cannon Beach exchanges. The Jewell, Astoria, and Seaside exchanges are currently served by U S WEST Communications.

The Jewell exchange is a rural logging and agricultural area that includes three unincorporated cities: Jewell, Mist and Birkenfeld. The area lies within the Coast Range Mountains and offers limited professional and commercial services to its local residents. Currently, the exchange has only four restaurants and four small convenience stores. Exchange residents, therefore, seek essential goods and services in neighboring communities.

The cities of Astoria and Seaside, each located approximately 35 miles from Jewell, are the closest towns that offer these basic services. A recent survey conducted by petitioners revealed that an overwhelming majority of exchange residents rely on both cities to meet their primary needs. The survey indicated that residents generally rely on Astoria for educational, governmental, professional, and social services. These include educational opportunities offered by the Clatsop Community College and other training programs, services offered through state and local governmental offices, as well as financial and legal services. In contrast, the survey revealed that exchange residents primarily rely on Seaside for personal and shopping services, including automotive repair, hardware and building supplies, retail shopping, and recreational activities. Many exchange residents also attend church and participate in other social clubs and organizations in Seaside.

A large portion of Jewell exchange residents are retired senior citizens. Demographic studies indicate that over 25 percent of the local population is over 60 years of age. These residents depend heavily on social and medical services available in Seaside and Astoria.

Schools

Jewell exchange residents are served by the Jewell School, which offers public education from pre-kindergarten through high school. The school relies on services provided by the Clatsop County Educational Service District, which is located in Astoria. Several exchange residents attend classes at Clatsop Community College in Astoria.

Government

The Jewell exchange lies primarily in Clatsop County and is served by county and state government offices in Astoria. As a result, local businesses and citizens must make long distance calls to obtain a variety of governmental and social services. These include the District and Circuit courts, Children Services Division, Adult and Family Services, Senior Services Division, Employment Division, Division of Motor Vehicles, Highway Department, District Attorney, and the Clatsop County Sheriff’s office.

The City of Jewell is served by the post office located in Seaside.

Medical and Dental Services

The Jewell calling area offers no medical and dental providers. Consequently, Jewell exchange residents equally rely on Astoria and Seaside for primary and specialized medical and dental care. Each city offers a hospital and a sizable number of medical and dental providers. The County Public Health Department is located in Astoria.

Commuting Patterns

Due to the lack of centralized businesses, a majority of Jewell exchange residents commute outside the local calling area to work in neighboring cities. A recent survey revealed that over 50 percent of respondents worked in Astoria or Seaside. Many Jewell residents work in county and state government offices in Astoria, or at many retail and tourist-related businesses located in Seaside.

Toll Avoidance

Many Jewell exchange residents engage in a variety of toll avoidance practices. Residents often avoid toll calls by combining a trip to Astoria or Seaside with their telephone activities. Commuters simply save calls and make them while they are at work or visiting the neighboring calling areas.

Results of the Objective Criteria Test

U S WEST provided calling pattern data for the Jewell, Astoria, and Seaside telephone exchanges. Staff reviewed the data and determined that the Jewell/Seaside interexchange route satisfied two of the three objective community of interest criteria. The two exchanges are contiguous and a maximum average of 4.44 toll calls per access line were placed between the exchanges. However, only 36.49 of a required 50 percent of Jewell exchange residents made at least two or more toll calls to the Seaside exchange.

Staff concluded that the Jewell/Astoria interexchange route satisfied only one of the three objective criteria. The exchanges are contiguous. However, a maximum average of only 3.60 of a required 4 toll calls per month were placed between the exchanges and only 36.19 of a required 50 percent of Jewell exchange residents made at least two or more toll calls to the Astoria exchange.

OPINION

Issue

The question presented in this proceeding is whether the Jewell petitioners have established, through demographic or other evidence, that a community of interest exists with the Astoria and Seaside telephone exchanges.

Applicable Law

In Phase I of an EAS investigation, the Commission determines whether a community of interest exists between the petitioning exchange and other exchanges listed on an EAS petition. The Commission adopted the following test for community of interest in cases where petitioners rely on demographic evidence:

A community of interest exists where there is social, economic, or political dependence or interdependence between the petitioning and requested exchange(s) sufficient to justify conversion to EAS. In making this determination, the Commission will review the following factors: (1) geographic and demographic information; (2) location of schools; (3) governmental and jurisdictional issues; (4) emergency services; (5) social services; (6) medical and dental providers; (7) employment and commuting patterns; (8) business and commercial dependence or interdependence; (9) transportation patterns; (10) the results of the objective criteria test; and (11) other factors deemed relevant by the Commission. The record need not contain evidence on each factor so long as the Commission can conclude that the record as a whole establishes sufficient interdependence or dependence between

the exchanges. In the Matter of the Consolidated Applications For Expansion of the Portland Extended Area Service Region, Order No. 93-1045 at 12.

 

Resolution

The Commission concludes that the Jewell petitioners have established, through demographic and other evidence, that a community of interest exists with the Astoria and Newport telephone exchanges. The evidence presented at hearing establishes a sufficient degree of dependence by the Jewell exchange residents on the Astoria and Seaside areas.

The Jewell area is a rural logging and agricultural community that offers virtually no business or professional services for its residents. Astoria and Seaside are the closest cities where a sizable number of businesses and professional services are available. Each city lies approximately 35 miles from the city of Jewell and, together, provide the necessary services to meet the basic needs of Jewell exchange residents. These include educational, governmental, medical and other professional services, as well as automotive repair, hardware and building supplies, retail shopping, and recreational activities. A majority of Jewell exchange residents also commute to Astoria and Seaside to work.

Because an overwhelming majority of Jewell exchange customers rely on both cities to meet their basic needs, many view Astoria and Seaside as one larger city offering all essential goods and services. This equal reliance is reflected in the results of the objective criteria test. Both the Jewell/Astoria and Jewell/Seaside interexchange routes averaged approximately 4 toll calls per month between the exchanges, and each failed the customer distribution requirement by a little less than 14 percent.

In summary, Jewell’s demographic evidence showed strong ties to both Astoria and Seaside. The Commission concludes that such evidence, when viewed with the results of the objective community of interest findings, persuasively establishes that a community of interest exists between the Jewell and Astoria and the Jewell and Seaside telephone exchanges. The EAS petition should proceed to Phase II (tariff analysis).

ORDER

IT IS ORDERED that:

The Jewell telephone exchange has established a community of interest with the both the Astoria and Seaside telephone exchange based upon demographic, economic, financial, and other evidence.

 

This completes Phase I of this docket. The petition is now ready to enter Phase II, the rate and cost phase of this proceeding. For Phase II, the Jewell petition will be grouped with other EAS dockets that complete Phase I by August 1. The serving telephone companies shall file proposed rates and supporting cost information by October 15, 1996.

 

Made, entered, and effective ________________________.

A party may request rehearing or reconsideration of this order pursuant to ORS 756.561. A party may appeal this order pursuant to ORS 756.580.