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                                                           Before the
               FEDERAL COMMUNICATIONS COMMISSION
                     Washington, D.C. 20554
                                
In the Matter of                        )
                                   )
Ameritech Illinois, U S WEST            )    
Communications, Inc., et al.,           )
     COMPLAINANTS,                 )
                                   )
          v.                       )    File Nos. E-98-51, E-98-53
                                   )
MCI Telecommunications Corporation,          )
     DEFENDANT,                    )
                                   )
          and                      )
                              )
Ameritech Illinois, Pacific Bell, et al.,         )
     COMPLAINANTS,                 )
                                   )
          v.                       )    File Nos. E-98-50, E-98-54, 
                                   )    E-98-55, E-98-56, E-98-57, 
Frontier Communications Services, Inc. et al.     )    E-98-58, E-98-59, and E-98-60.
     DEFENDANTS.                   )
                                   )    
                                
                  MEMORANDUM OPINION AND ORDER
                                
    Adopted: November 4, 1999;   Released: November 8, 1999 
                                
By the Chief, Common Carrier Bureau:

                        I.  INTRODUCTION
                                
1.     In this order, we resolve several formal complaints filed by local exchange carriers
(LECs) Pacific Bell, et al. (SBC), Ameritech Illinois, et al., (Ameritech) and U S WEST
Communications Corporation (U S WEST) (collectively Complainants) against defendant
interexchange carriers (IXCs) Frontier Communications Services, Inc. et al. (Frontier) and MCI
Telecommunications Corporation (MCI) (collectively Defendants), pursuant to section 208 of
the Communications Act of 1934, as amended (Act).  Complainants contend that Defendants
violated section 276 of the Act and section 64.1300 of the Commission's rules by refusing to pay
payphone compensation for compensable calls that originated on Complainants' payphones even
though Complainants had certified their compliance to the IXCs.  Pursuant to section 276 of the
Act, and the Commission's implementing rules and orders, IXCs are required to compensate
payphone service providers including LEC payphone service providers for certain completed
intrastate and interstate calls originated from the payphone service providers' payphones. 

2.     Defendants each filed an answer arguing that Complainants are not entitled to
payphone compensation for the calls at issue because Complainants have not adequately certified
that they have complied with the payphone compensation prerequisites set forth in the Payphone
Orders.  Defendants argue that certification requires that each complainant prove to Defendants'
satisfaction that it has met all of the payphone compensation prerequisites, including the removal
of intrastate payphone subsidies from the LEC's rates.

3.     On  September 24, 1999, the Common Carrier Bureau (Bureau) adopted an order
resolving Bell Atlantic's formal complaints against Frontier and MCI concerning their refusal to
pay payphone compensation to Bell Atlantic.  In that order, the Bureau concluded that the term
"certification" as set forth in the Order on Reconsideration, does not require a LEC payphone
service provider to demonstrate to the IXC payor that the LEC has satisfied each payphone
compensation prerequisite.  Instead, the Bureau concluded that under the Commission's rules and
orders, a LEC sufficiently "certifies" its compliance with the prerequisites by attesting
authoritatively to an IXC payor that such LEC has satisfied each payphone compensation
prerequisite.  The complaints resolved in this Order raise the same issues addressed in Bell
Atlantic v. Frontier: specifically, whether the term "certification" requires a LEC to provide
evidence to the IXC payor demonstrating that such LEC has satisfied each payphone
compensation prerequisite.  Defendants have not raised any new legal arguments in response to
the complaints now before us to support their claim that certification requires a LEC to
demonstrate its compliance with the payphone compensation prerequisites to the IXC payors. 
Thus, we find that the analysis set forth in the Bell Atlantic v. Frontier order is applicable to the
instant complaints.  Accordingly, we incorporate by reference into this Order, the analysis and
supporting rationale of the Bell Atlantic v. Frontier order.  

4.     Applying the analysis set forth by the Bureau in Bell Atlantic v. Frontier, we conclude
in this Order that each complainant adequately certified to Defendants that it satisfied the
payphone compensation prerequisites.  We order Defendants to pay payphone compensation to
Complainants for all compensable calls routed to them that originated from Complainants'
payphones during the fourth quarter of 1997, the first quarter of 1998, and all subsequent calls, as
required by the Act and the Commission's rules. 

                        II.  BACKGROUND

A.   Statutory Authority.
     
5.     In the Payphone Orders, the Commission adopted new rules and policies governing
the payphone industry to implement section 276 of the Act.  Those rules and policies: (1) establish
a plan to ensure fair compensation for "each and every completed intrastate and interstate call
using [a] payphone[;]" (2) establish a plan to discontinue intrastate and interstate carrier access
charge service elements and payments in effect on such date of enactment, and all intrastate and
interstate payphone subsidies from basic exchange services; (3) prescribe nonstructural safeguards
for Bell Operating Company (BOC) payphones; (4) permit the BOCs to negotiate with location
providers regarding the interLATA carrier presubscribed to their payphones; (5) permit all
payphone service providers to negotiate with location providers about the intraLATA carriers that
are presubscribed to their payphones; and (6) adopt guidelines for use by the states in establishing
public interest payphones to be located "where there would otherwise not be a payphone[.]"

6.     In the Payphone Orders, consistent with section 276 of the Act, the Commission
concluded that all payphone service providers, including LEC payphone service providers, must
be compensated for "each and every completed intrastate and interstate call" originated from their
payphones.  The Commission further concluded that IXCs, the primary economic beneficiary of
such calls, would be responsible for compensating the payphone service providers.  The
Commission determined that LEC payphone service providers would be eligible to receive
compensation for completed calls originated from their payphones once they had satisfied certain
requirements.  Specifically, to receive compensation, the Commission required that each LEC
"must be able to certify" that it had complied with those prerequisites.  

7.     In the Payphone Orders, the Commission did not set forth any requirements for the
form of such a certification.  The Commission subsequently stated in the Second Report and
Order, however, that LEC payphone service providers are not required to file such a certification
with any state or federal regulatory agency or to obtain a formal certification of compliance from
either the Commission or the states to be eligible to receive per-call compensation pursuant to the
Payphone Orders.  Addressing certification in the Bureau Intrastate Tariffing Waiver Order,
the Bureau stated that, although the Commission does not require a LEC payphone service
provider to file a certification with it, nothing in the Payphone Orders prohibits an IXC payor
from requesting such a certification from the LECs.  In the Bureau Coding Digit Waiver Order,
the Bureau further stated that "LECs that have certified to the IXC that they comply with the
requirements of the Payphone Orders must receive per-call compensation."  In Bell Atlantic v.
Frontier, the Bureau concluded that certification does not require a LEC to prove to the IXCs'
satisfaction that such LEC has complied with the prerequisites to payphone compensation.    
       
       
B.     The Complaints.
       
8.     Complainant LECs provide local exchange and payphone services in certain regions
within the United States.  Defendants Frontier and MCI are IXCs that provide both interstate
and intrastate telephone toll service.  Defendants are subject to payphone compensation
obligations set forth in the Commission's rules and orders and the Act.  Since October 7, 1997,
the beginning of per-call compensation, each Complainant has delivered calls from its payphones
to Defendants.   

9.     To obtain compensation for calls that originated from its payphones, each Complainant
sent letters to Defendants stating that it was eligible to receive payphone compensation. 
Defendants Frontier and MCI responded similarly to Complainants' letters, each stating that it
would not pay compensation until the LEC had provided evidence to the IXC payor that
demonstrated that such LEC had complied with the payphone compensation prerequisites.  Both
Frontier and MCI, however, paid compensation in some states.

10.    Additionally, in June 1998, representatives from each LEC met with representatives
from MCI and Frontier (on separate occasions), along with certain Commission staff members, to
discuss Defendants' obligations to pay payphone compensation.  During these meetings,
Commission staff stated that the Payphone Orders clearly mandated that IXCs must compensate a
LEC payphone service provider upon receipt of the LEC's certification of eligibility without
further inquiry or requirements.  Nonetheless, each Defendant stated that it would not compensate
the LECs until the LEC had proven to each Defendant's satisfaction that the LEC had satisfied
the payphone compensation prerequisites.  

11.    In August 1998, Ameritech brought a formal complaint against MCI and Frontier, and
U S WEST brought a formal complaint against MCI.  In September 1998, SBC brought a
formal complaint against Frontier.  Each complaint alleged that Defendants' refusal to pay
payphone compensation violated section 276 of the Act and the Commission's implementing rules
and orders.  To facilitate resolution of the issues addressed in each complaint, the Enforcement
Division of the Common Carrier Bureau (Division) held a status conference in each particular
case for the parties.  At each conference, the Division directed the parties to brief two specific
issues: (1) what constitutes a "certification" as required by the Commission's Payphone Orders,
and has the LEC complied with this certification requirement; and (2) are there any circumstances
under which an IXC may refuse to pay payphone compensation after receiving a certification from
a payphone service provider.  

                        III.  DISCUSSION
       
A.     Certification does not require proof of compliance to the IXC payor.

12.    In the Payphone Orders, the Commission set forth prerequisites that LEC payphone
service providers must satisfy to be eligible to receive payphone compensation.  In doing so, the
Commission delineated explicit guidelines that LECs must follow to satisfy each prerequisite,
including, in some cases, filing tariffs satisfying the prerequisite.  In the Order on
Reconsideration, the Commission stated that once these prerequisites had been met, "[t]o receive
compensation, a LEC must be able to certify the following"

          (1) it has an effective cost accounting manual (CAM) filing; (2) it has an effective
     interstate CCL tariff reflecting a reduction for deregulated payphone costs and
     reflecting additional multiline subscriber line charge (SLC) revenue; (3) it has
     effective intrastate tariffs reflecting the removal of charges that recover the costs
     of payphones and any intrastate [payphone] subsidies; (4) it has deregulated and
     reclassified or transferred the value of payphone customer premises equipment
     (CPE) and related costs as required in the Report and Order; (5) it has in effect
     intrastate tariffs for basic payphone services (for "dumb" and "smart" payphones);
     and (6) it has in effect intrastate and interstate tariffs for unbundled functionalities
     associated with those lines. 

The Commission also required these LECs that are BOCs to "have approved [comparably
efficient interconnection (CEI)] plans for basic payphone services and unbundled functionalities
prior to receiving compensation."  

13.    Complainants contend that they are entitled to receive payphone compensation from
Defendants because each LEC "certified" to Defendants that it complied with the Commission's
payphone compensation prerequisites.  Defendants argue that the statements that the LEC
"certifies" that it has complied with the Commission's prerequisites do not constitute a
"certification" as required by the Commission's orders.  Instead, Defendants contend that
certification requires a LEC to provide evidence to the IXC payors demonstrating that the LEC
actually has met the Commission's payphone compensation prerequisites.  Defendants thus
contend that the LECs are not entitled to payphone compensation, because the LECs have not
provided the IXCs proof positive that such LECs satisfied the compensation eligibility
prerequisites, including the requirement that the LEC remove intrastate payphone subsidies from
its intrastate rates.

14.    To resolve the complaints before us, we must determine whether each of the LEC's
purported certification letters, which state that the LEC has complied with each compensation
eligibility prerequisite, constitute a valid certification thus triggering a payment obligation by
Defendants.  In Bell Atlantic v. Frontier, which presented the same legal issues raised in the
present complaints, the Bureau concluded that the term "to certify" as set forth in the Order on
Reconsideration does not require a LEC to demonstrate to the IXC payor's satisfaction that such
LEC has met each compensation eligibility prerequisite.  Instead, the Bureau concluded that "to
certify" requires a LEC to attest that it has complied with each compensation eligibility
prerequisite. 

15.    In the present case, Defendants contend that certification should require a LEC to
provide actual proof of compliance of each payphone compensation prerequisite to the IXC
payor, not solely an attestation of compliance.  Defendants recognize that the Commission has not
specifically defined the term "certification" in the context of payphone compensation. 
Defendants argue, however, that certification mechanisms are used in other contexts that are
analogous to the instant matter, and that such mechanisms require the submission of evidence to
constitute certification.  For example, Defendants argue that D.C. Circuit Court's decision in
Committee to Elect Lyndon LaRouche v. Federal Election Commission, which found a
candidate's certification to be insufficient without supporting documentation, illustrates that
certification requires proof of actual compliance.  In contrast, Complainants contend since
neither the Commission's orders nor statutory authority define the term "to certify," the ordinary
meaning of the term should be applied. 

16.    We reject Defendants arguments for the reasons stated in Bell Atlantic v. Frontier.  In
that order, the Bureau found that certification requires a LEC to attest that it has complied with
the payphone compensation prerequisites.  The Bureau stated that certification does not require
a LEC to prove to the IXC payor that such LEC has satisfied each payphone compensation
prerequisite.  In reaching that conclusion, the Bureau examined the use of the ordinary meaning
of the term "to certify" the formal assertion in writing of some fact and found that in the
context of payphone compensation, the ordinary meaning of the term "certification" signifies an
assertion or representation by the certifying party, not, as Defendants' assert, a demonstration of
proof of the facts being asserted.  The Bureau further stated that the Commission also has
applied the ordinary meaning of the term "to certify" in other contexts where the Commission has
not identified specific criteria to constitute "certification," such as in the context of a formal
complaint.  The Bureau found that nothing in the Payphone Orders suggests other than the
ordinary meaning of the term "to certify."  

17.    The Bureau also found Defendants' arguments supporting a broader meaning of the
term "certify" to be unpersuasive.  In particular, the Bureau found that MCI's reliance on
Committee to Elect LaRouche to be misplaced.  The Bureau stated that unlike the statute at issue
in Committee to Elect LaRouche, section 276 does not contain any certification requirements. 
Moreover, the Bureau stated that the statute at issue in Committee to Elect LaRouche specifically
required review of the certification by a federal agency to determine if the candidate was eligible
to receive funding.  There is no parallel requirement in the present case.  The Bureau further
stated that under the defendants' theory that LECs are required to prove to the IXC's satisfaction
that such LEC had complied with the payphone compensation prerequisites, the IXC would be the
ultimate judge of whether the LEC payphone service provider had complied with the
Commission's rules and orders.  The Bureau concluded that such outcome would be unacceptable,
because it would allow the IXC to delay paying compensation indefinitely.  Additionally, section
276 requires that the Commission "ensure all payphone service providers are fairly compensated
for each . . . call" made from a payphone.  The Commission has not and cannot delegate this
statutory requirement to IXCs.     

18.    Defendants have not presented any new arguments to support their position that
"certification" requires proof of compliance with the payphone compensation prerequisites. 
Instead, Defendants reiterate the arguments presented in Bell Atlantic v. Frontier.  We therefore
conclude that there is no reason to alter the Bureau's determination in Bell Atlantic v. Frontier
that "certification" requires an attestation of compliance.  Accordingly, we now review each
complainant's purported certification letters to determine if such letters constitute a
"certification."  

          1.   U S WEST v. MCI

2.     We conclude that U S WEST's certification letters satisfy the Commission's
requirement that a LEC "must be able to certify" as set forth in the Order on Reconsideration.   
To obtain compensation for calls originated from its payphones, Complainant U S WEST sent a
letter signed by a U S WEST representative to MCI on May 20, 1997 attesting that U S WEST
had satisfied the payphone compensation prerequisites in 13 of the 14 states in U S WEST
territory.  Specifically, U S WEST states, "[i]n response to the FCC's implementation
requirements for Section 276 [ . . . ] regarding the new rules and policies governing the payphone
industry, U S WEST Communications hereby certifies that it has met all the requirements of the
FCC to receive payphone compensation from carriers in all of its states except one."  On
November 12, 1997, U S WEST updated its certification, and stated that it was eligible to receive
payphone compensation in all 14 states in its region.  As detailed above, to constitute a
certification the LEC must assert that it has complied with the compensation eligibility
prerequisites.  We find that U S WEST's letters of certification clearly meet this standard.  

3.     In addition to stating that it had complied with each prerequisite, U S WEST's letters
provided a state-by-state status report on the removal of payphone subsidies, PAL tariffs, and
unbundled features available in state tariffs.  We stated above that certification requires an
attestation that the LEC has complied with each compensation eligibility prerequisite.  Thus, U S
WEST not only satisfied its obligation to attest to its compliance, but also provided specific
information to the IXC concerning compliance.  In light of such thorough filings, MCI had no
basis for refusing to pay compensation.

          4.   SBC v. Frontier

5.     SBC argues that it has certified its compliance to Frontier, thus entitling SBC to
receive payphone compensation.  SBC further states that its certifications meet and exceed the
requirements of the Payphone Orders, and that SBC "went the second mile to address
Defendants' concerns and to show compliance with the Commission's directives."  In particular,
in an effort to obtain per-call compensation, in June 1997, SWBT, Nevada Bell, and Pacific Bell,
each sent a letter to Frontier certifying that the particular LEC has satisfied the payphone
compensation prerequisites.  In response to SWBT's letter, on June 30, 1997, Frontier stated
that it would not pay compensation until SWBT completed requirements set forth by Frontier,
specifically, until SBC provided evidence demonstrating that SWBT had complied with each
payphone compensation prerequisite, inter alia, the removal of intrastate payphone subsidies. 
SBC, on behalf of SWBT, subsequently sent a copy of its "certification letter and package" to the
National Payphone Clearinghouse and to Frontier.  SBC, on behalf of Pacific Bell, Nevada Bell,
and SWBT, also issued a subsequent letter on May 30, 1998, stating that all of SBC's companies
previously had certified their compliance to Frontier.  In these letters, SBC provided additional
information, such as statements regarding how the intrastate payphone subsidies had been
removed where applicable, "to foreclose any possible objections that you may have."  

6.     As stated above, in June 1997, SWBT, Nevada Bell, and Pacific Bell each sent a letter
signed by a representative of the LEC to Frontier certifying that it had satisfied the payphone
compensation prerequisites.  In each letter, SBC states, "[SWBT, Pacific Bell, or Nevada Bell]
hereby certifies that it has met the requirements established by the [Commission] to receive
compensation from carriers."  SBC proceeds to list each requirement and attest that each
requirement has been met.  Certification, in the context of payphone compensation, requires the
LEC to attest its compliance with each prerequisite.  We find that each of SBC's June 1997 letters
clearly meet this standard.

          7.   Ameritech v. Frontier, MCI
     
8.     We also find that Ameritech's letters to Defendants constitute an adequate
certification.  In an effort to obtain compensation for its payphones, by letter dated April 17,
1997, Ameritech certified to each defendant that it had satisfied all of the prerequisites to
payphone compensation.  Defendants responded similarly to their responses to other LEC
payphone service providers, each stating that it would not pay compensation to Ameritech until
Ameritech demonstrated that it had complied with the payphone compensation prerequisites.  For
example, in response to Ameritech's April 17, 1997 letter, on April 18, 1997, MCI requested
additional information regarding Ameritech's certification of compliance.  Specifically, MCI
stated that it would not pay compensation "until each eligible carrier has clearly demonstrated that
it has met all criteria necessary for the receipt of such compensation."  Ameritech responded to
MCI's April 18, 1997 letter by listing the applicable tariff or order demonstrating that each
payphone compensation prerequisite had been satisfied.  Ameritech did not provide the tariffs or
orders, stating that such documents were public and could be obtained by MCI.

9.     Frontier responded similarly to Ameritech's letters, stating that Frontier would not pay
compensation until Ameritech provided evidence demonstrating that Ameritech had satisfied the
payphone compensation prerequisites.  In particular, Frontier requested copies of Ameritech's
state tariff and other relevant filings and state commission orders related to the removal of
intrastate payphone subsidies.  Based on the evidence in the record, it does not appear that
Ameritech responded to Frontier's request for specific information.

10.    Nonetheless, we find that Ameritech's letters to Defendants constitute an adequate
certification.  As stated above, certification requires that Ameritech attest that it has complied
with each payphone compensation prerequisite.  In its April 17, 1997 letters to Defendants,
Ameritech specifically asserts that it is eligible to receive compensation.  We thus find that
Ameritech's letters to Defendants constitute an adequate certification.   
       
B.   Eligibility Disputes

11.    The Bureau has specifically stated that IXCs must pay compensation upon receipt of
the LEC's certification.  There is no exception to this absolute obligation to pay upon receipt of
certification.  As noted above, the Payphone Orders delegated to the Bureau the authority to
determine whether a LEC had complied with the prerequisites to payphone compensation.  IXCs
questioning the veracity of a LEC's certification may challenge the LEC's compliance by initiating
a proceeding at the Commission.

12.    In the instant matters, neither Frontier nor MCI have availed themselves of this
remedy, but instead have undertaken the remedy of self-help by refusing to pay compensation
mandated by our rules.  As we have stated in other contexts, such self-help remedies are strongly
disfavored by the Commission.  We emphasize that a LEC's certification letter does not
substitute for the LEC's obligation to comply with the requirements as set forth in the Payphone
Orders.  The Commission consistently has stated that LECs must satisfy the requirements set
forth in the Payphone Orders, subject to waivers subsequently granted, to be eligible to receive
compensation.  Determination of the sufficiency of the LEC's compliance, however, is a function
solely within the Commission's and state's jurisdiction. 

C.     Damages.

13.    We conclude above that Complainants' letters constitute an adequate certification,
such that these letters triggered Defendants' obligation to pay payphone compensation.  The
Commission bifurcated this proceeding into liability and damages phases.  Thus, in accordance
with section 1.722(b) of the Commission's rules, each complainant may file a supplemental
complaint for damages within sixty days of the release of this order.

              IV. CONCLUSION AND ORDERING CLAUSES

14.    In conclusion, we find that Complainants' letters to Defendants satisfy the
Commission's certification requirement.  We also find that Defendants' arguments that the LECs
were required to demonstrate compliance to their satisfaction are without merit for the reasons
stated above.  Under Defendants' theory, the IXC would be the ultimate judge of whether the
LEC payphone service provider had complied with the Commission's rules and orders.  This
outcome is unacceptable.  First, such a construct would allow the IXC to delay paying
compensation indefinitely.  Second, the statute requires that the Commission "ensure all payphone
service providers are fairly compensated for each . . . call" made from a payphone.  The
Commission has not and cannot delegate this statutory requirement to IXCs.  Therefore, we
conclude that Ameritech, SBC, and U S WEST are entitled to receive per-call compensation from
Frontier and MCI.

15.    Accordingly, IT IS ORDERED, pursuant to Sections 1, 4(i), 4(j), 208, and 276 of the
Communications Act of 1934, as amended, 47 U.S.C.  151, 154(i), 154(j), 208, and 276, that
the complaints filed by Illinois Bell Telephone Company, Inc., d/b/a Ameritech Illinois, Indiana
Bell Telephone Company, Inc., d/b/a Ameritech Indiana, Michigan Bell Telephone Company, Inc.,
d/b/a Ameritech Michigan, The Ohio Bell Telephone Company, d/b/a Ameritech Ohio, Wisconsin
Bell, Inc., d/b/a Ameritech Wisconsin; and by Pacific Bell, Nevada Bell, and Southwestern Bell
Telephone Company against Frontier Communications Services Inc., Frontier Communications
International Inc., Frontier Communications of the West Inc., Frontier Communications-North
Central Region Inc., Frontier Communications of New England Inc., and Frontier
Communications of the Mid Atlantic Inc. ARE GRANTED TO THE EXTENT INDICATED
HEREIN.

16.       IT IS FURTHER ORDERED, pursuant to Sections 1, 4(i), 4(j), 208, and 276 of
the Communications Act of 1934, as amended, 47 U.S.C.  151, 154(i), 154(j), 208, and 276,
that the complaints filed Illinois Bell Telephone Company, Inc., d/b/a Ameritech Illinois, Indiana
Bell Telephone Company, Inc., d/b/a Ameritech Indiana, Michigan Bell Telephone Company, Inc.,
d/b/a Ameritech Michigan, The Ohio Bell Telephone Company, d/b/a Ameritech Ohio, Wisconsin
Bell, Inc., d/b/a Ameritech Wisconsin; and by U S WEST Communications Corporation against
MCI Communications Corporation IS GRANTED TO THE EXTENT INDICATED HEREIN.

17.    IT IS FURTHER ORDERED that Ameritech MAY FILE a supplemental complaint
for damages within sixty (60) days pursuant to Section 1.722(b)(2) of the Commission's rules, 47
C.F.R.  1.722(b).

18.    IT IS FURTHER ORDERED that U S WEST MAY FILE a supplemental complaint
for damages within sixty (60) days pursuant to Section 1.722(b)(2) of the Commission's rules, 47
C.F.R.  1.722(b).

19.    IT IS FURTHER ORDERED that SBC MAY FILE a supplemental complaint for
damages within sixty (60) days pursuant to Section 1.722(b)(2) of the Commission's rules, 47
C.F.R.  1.722(b).

     
                              FEDERAL COMMUNICATIONS COMMISSION



                              Lawrence E. Strickling
                              Chief, Common Carrier Bureau