ORDER NO. 97-229

ENTERED JUN 20 1997

This is an electronic copy.

BEFORE THE PUBLIC UTILITY COMMISSION

OF OREGON

ARB 11

DISPOSITION: APPLICATION FOR RECONSIDERATION GRANTED IN PART.

On September 25, 1996, Sprint Communications Company L.P., (Sprint) filed a petition with the Public Utility Commission of Oregon to arbitrate a contract for network interconnection with GTE Northwest Incorporated (GTE), pursuant to 47 U.S.C. Section 252 of the Communications Act of 1934, as amended by the Telecommunications Act of 1996 ("Act"). Arbitrator Michael Grant held a hearing and issued a decision on January 21, 1997, resolving the issues not previously negotiated between the parties.

The Commission adopted the Arbitrator’s decision in Order No. 97-053, which was issued on February 18, 1997. The Commission substantially confirmed the findings and conclusion of the Arbitrator’s decision and required the parties promptly to prepare a network interconnection agreement consistent with the decision.

On February 20, 1997, Sprint indicated that it intended not to execute an agreement pursuant to the arbitrator’s decision; instead Sprint would "elect" to enter into an interconnection agreement with GTE that would be identical in its terms and conditions to an interconnection agreement between GTE and AT&T Communications of the Pacific Northwest (AT&T). This arbitrated GTE-AT&T agreement is pending final approval by this Commission in a separate proceeding, ARB 5.

On April 21, 1997, Sprint applied for reconsideration of the Commission’s Order No. 97-053 and requested an extension of time in which to comply with the Order. The application indicates that Sprint intends to "elect" the AT&T-GTE interconnection agreement "in its entirety" once that agreement has been approved by this Commission. Sprint alleges it that has a right to make this election under Section 252(i) of the Act.

Positions of the Parties

The Arbitrator’s decision and the Commission’s Order No. 97-053 require that GTE provide Sprint a wholesale discount of 18.81% on services purchased for resale. Sprint’s application for reconsideration alleges that this requirement is discriminatory, since GTE will provide AT&T a 21.0% wholesale discount pursuant to the AT&T-GTE arbitrated agreement. Sprint alleges that this disparity places it at a competitive disadvantage and violates the nondiscrimination requirements of Section 251 of the Act.

GTE filed its response on May 7, 1997, alleging that Sprint’s attempt to ignore this arbitration evidenced bad faith, contrary to the requirements of the Act. The response further alleges that the availability of a Section 252(i) "election" is currently unsettled, but in any case such an election must be made prior to commencement of arbitration. GTE also questions whether Sprint intends in fact to adopt the AT&T-GTE arbitration agreement in its entirety, and alleges that Sprint intends to modify that agreement in each state on a case-by-case basis.

Discussion

Earlier in this proceeding, Sprint argued that the nondiscriminatory provisions of Section 252 permitted it to incorporate into its interconnection agreement any rate, term, or condition contained in other agreements between GTE and competitive carriers. We rejected that argument, concluding that allowing a carrier to "pick and choose" individual provisions would undermine the congressional preference for negotiated and arbitrated agreements. See Order No. 97-053, Appendix A at 11.

In a modification of its earlier argument, Sprint now contends that Section 252(i) permits it to elect, in its entirety, the final arbitrated contract between AT&T and GTE. That section provides:

AVAILABILITY TO OTHER TELECOMMUNICATIONS CARRIERS—A local exchange carrier shall make available any interconnection, service, or network element provided under an agreement approved under this section to which it is a party to any other requesting telecommunications carrier upon the same terms and conditions as those provided in the agreement.

After review, we agree that the text of Section 252(i) supports a competitive carrier’s ability to elect an entire interconnection agreement. As stated above, the provision requires an incumbent carrier to make available the services and elements "provided under an agreement * * * to any other requesting telecommunications carrier upon the same terms and conditions as those provided in the agreement." (Emphasis added.) Accordingly, we hold that, as a matter of law, Sprint is entitled to elect, in its entirety, any final interconnection agreement that GTE enters into with another carrier, including AT&T.

We decline, however, to grant Sprint’s request to elect the GTE-AT&T contract in this proceeding. Sprint initiated this docket pursuant to Section 251 of the Act, seeking arbitration of a contract for network interconnection. As we stated in our prior order, such a procedure is governed by Section 252(c), and is designed to resolve any open issues not previously negotiated between the parties. While we conclude that Sprint has the right under Section 252(i) to elect another interconnection agreement rather than negotiate one of its own, such a request is beyond the scope of this case.

Indeed, to elect the final GTE-AT&T interconnection agreement, Sprint must first withdraw this request for arbitration. This Commission will not simultaneously entertain mutually exclusive competing proceedings; one seeking an interconnection agreement incorporating terms of the Arbitrator’s order, the other seeking the election of the interconnection agreement of another carrier.

We acknowledge GTE’s concern that Sprint is not actually pursuing a clean election of the entire GTE-AT&T agreement, but rather intends to use the contract as a baseline from which Sprint would select certain provisions and negotiate further changes. We do not agree, however, that such a tactic would allow Sprint to implement the disallowed "pick and choose" provision. We have determined that Sprint is entitled to elect the same interconnection agreement as will exist between GTE and AT&T, pending final Commission approval. Because Sprint is limited to electing the GTE-AT&T contract as a whole, no issues of interpretation as to its ability to "pick and choose" among provisions from various contracts will arise.

In making this decision, we note that a carrier seeking to elect another interconnection agreement pursuant to Section 252(i) need not first initiate a request for interconnection under Section 251. Rather, we conclude that a carrier is permitted to seek election of another interconnection agreement on an expedited basis directly with the Commission. We find this interpretation furthers the Act’s goal of opening up local markets by enabling such competition to occur as quickly and efficiently as possible.

Conclusion

We conclude that Sprint is entitled to elect the final arbitration agreement as it will exist between GTE and AT&T. The request for such an election, however, is beyond the scope of this arbitration proceeding. Accordingly, we deny Sprint’s request to elect that agreement in this docket. To allow such election, however, we modify the schedule for the preparation and presentation of a signed interconnection agreement set forth in Order No. 97-053. In that order, we required Sprint to submit to GTE a contract incorporating the terms of the Commission’s decisions within 15 days from the date of the order. We remove that time limitation, thus allowing Sprint to submit an interconnection agreement to GTE when it so desires.

ORDER

IT IS ORDERED that:

1. The application of Sprint Communications Company L.P., for reconsideration of Order No. 97-053 is granted in part.

2. Sprint has the right, under Section 252(i), to elect in its entirety the final interconnection agreement as it will exist between GTE and AT&T. To allow Sprint the opportunity to make such an election, the time limit for Sprint to submit a contract to GTE in this Arbitration proceeding is eliminated.

Made, entered, and effective ____________________________.

A party may appeal this order to a court pursuant to applicable law.