*Pages 1--10 from  D:\Pdf2Text\Ready4Text_in\pdf\21053.pdf*
 Richard  T.  Ellis  Director    Federal  Affairs 
 August  30,  2002 
 1300  I  Street,  NW  Suite  400  West 
 Washington,  DC  20005  (202)  515-  2534 
 (202)  336-  7866  (fax) 


 Ex  Parte 
 Marlene  H.  Dortch  Secretary 
 Federal  Communications  Commission  445  12  th  H  Street,  SW,  Portals 
 Washington,  DC  20554 
 Re:  Joint  Application  by  Verizon  for  Authorization  To  Provide  In-  Region,  InterLATA  Services  in  States  of  Delaware  and  New  Hampshire,  Docket  No.  02-  157 


 Dear  Ms.  Dortch: 
 Verizon  has  previously  demonstrated  in  its  application  in  this  proceeding  that  Verizon  has  satisfied  the  requirements  of  Section  271  of  the  Act,  and  the  Delaware  commission  has  agreed 
 based  on  the  results  of  its  own  extensive  investigations.  Likewise,  the  United  States  Department  of  Justice  recommends  approval.  As  Verizon  also  previously  demonstrated,  the  Delaware 
 commission  has  adopted  a  full  suite  of  rates  for  unbundled  elements  that  it  has  concluded  are  TELRIC-  compliant.  Consequently,  the  voluntary  measure  that  Verizon  is  implementing,  as 
 described  below,  is  not  in  any  way  necessary  to  demonstrate  compliance  with  Section  271,  other  sections  of  the  Act,  or  the  Federal  Communications  Commissions  rules. 


 Nonetheless,  because  an  issue  has  been  raised  regarding  the  level  of  Verizons  non-  loop  rates,  Verizon  is  voluntarily  modifying  its  unbundled  switching  rates  in  Delaware  to  eliminate  any 
 possible  argument  that  these  rates  exceed  the  TELRIC  range.  Specifically,  Verizon  is  reducing  its  originating  unbundled  switching  rate  from  $.  003634  to  $.  002507,  and  its  terminating 
 unbundled  switching  rate  from  $.  001927  to  $.  001330. 
 As  indicated  in  the  attached  letter  to  the  Delaware  commission,  the  new  switching  rates  are  applicable  to  all  CLECs  operating  in  Delaware,  and  will  remain  in  effect  until  the  Delaware 
 commission  otherwise  modifies  the  rate.  See  Attachment  1.  These  rate  reductions  are  effective  immediately.  Additionally,  Verizon  notified  CLECs  of  the  new  switching  rates  today  by  email 
 via  the  normal  change  management  process. 
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 As  the  chart  in  Attachment  2  demonstrates,  with  these  rate  reductions,  the  Delaware  non-  loop  rates  benchmark  to  the  New  York  non-  loop  rates  using  the  FCCs  USF  Model.  Specifically,  the 
 relative  level  of  non-  loop  costs  in  Delaware,  as  determined  by  the  FCCs  USF  model,  are  11  percent  more  than  the  cost  level  in  New  York,  while  the  statewide  average  non-  loop  rate  for 
 Delaware  is  also  11  percent  higher  than  the  statewide  non-  loop  rates  in  New  York.  This  analysis  uses  state-  specific  assumptions,  including  DEM  minutes  of  use,  as  outlined  in  Attachment  3  to 
 the  Martin/  Garzillo/  Sanford  Decl. 
 Because  the  reduced  Delaware  switching  rates  result  in  the  Delaware  non-  loop  rates  benchmarking  to  the  New  York  non-  loop  rates,  which  the  long  distance  carriers  have  repeatedly 
 championed,  there  should  be  no  question  that  the  Delaware  non-  loop  rates  are  within  the  range  that  a  reasonable  application  of  TELRIC  would  produce. 


 Please  let  me  know  if  you  have  any  questions.  The  twenty-  page  limit  does  not  apply  as  set  forth  in  DA  02-  1497. 
 Sincerely, 


 cc:  H.  Thaggert  V.  Schlesinger 
 G.  Remondino  T.  Wilson 
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 ATTACHMENT  1 
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 Julia  A.  Conover  Vice  President  and  General  Counsel-  Delaware 
 901  Tatnall  Street  2nd  Floor 
 Wilmington,  DE  19801  Tel.  215-  963-  6001 
 Fax  215-  563-  2658 


 August  30,  2002 
 Via  Hand  Delivery  Ms.  Karen  Nickerson 
 Commission  Secretary  Delaware  Public  Service  Commission 
 861  Silver  Lake  Boulevard  Cannon  Building,  Suite  100 
 Dover,  DE  19904 
 Re:  In  the  Matter  of  the  Inquiry  Into  Verizon  Delaware  Inc.  s  Compliance  With  the  Conditions  Set  Forth  in  47  U.  S.  C.    271(  c),  Docket  No.  02-  001 


 Dear  Ms.  Nickerson: 
 In  Phase  I  of  its  proceeding  setting  rates  for  Verizon  Delaware  Incs  (Verizon  DEs)  Unbundled  Network  Elements,  the  Commission  adopted  rates  for  unbundled 
 switching  using  the  TELRIC  methodology.  1  Certain  parties  have  raised  concerns  about  Verizon  DEs  switching  rates  in  the  proceeding  before  the  Federal  Communications 
 Commission  to  consider  Verizons  application  for  long  distance  authority  in  Delaware. 
 While  Verizon  DE  continues  to  believe  that  its  UNE  switching  rates  are  TELRIC-compliant,  in  order  to  resolve  those  concerns,  Verizon  DE  is  reducing  its  unbundled 
 switching  rates  31%.  Specifically,  Verizon  is  reducing  its  originating  unbundled  switching  rate  from  $.  003634  to  $.  002507  and  its  terminating  unbundled  switching  rate 
 from  $.  001927  to  $.  001330.  These  rate  reductions  will  be  effective  immediately. 
 These  new  switching  rates  will  be  applicable  to  all  CLECs  operating  in  Delaware  and  shall  remain  in  effect  until  the  Commission  otherwise  modifies  the  rates. 


 All  CLECs  will  be  notified  of  this  change  by  a  change  management  notice  that  will  be  distributed  via  E-  MAIL. 
 1  In  the  Matter  of  the  Application  of  Bell  Atlantic-  Delaware,  Inc.  for  Approval  of  Its  Statement  of  Terms  and 
 Conditions  under  Section  252(  f)  Of  The  Telecommunications  Act  of  1996,  PSC  Docket  No.  96-  324,  Findings,  Opinion  and  Order  No.  4542,  dated  July  8,  1997  (  Phase  I  Order).  This  portion  of  the 


 Commissions  Phase  I  was  affirmed  on  appeal  by  the  United  States  District  Court  for  the  District  of  Delaware.  Bell  Atlantic-  Delaware,  Inc.  v.  McMahon,  80  F.  Supp.  2d  218  (D.  Del.  2000). 
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 Please  do  not  hesitate  to  contact  the  undersigned  should  the  Commission  require  further  information  about  this  matter. 
 Very  truly  yours, 
 Julia  A.  Conover 
 JAC/  meb  Enc. 
 Via  E-  Mail  and  UPS  Overnight  Delivery  cc:  Attached  Certificate  of  Service 
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 CERTIFICATE  OF  SERVICE  PSC  Docket  No.  02-  001 
 I,  Julia  A.  Conover,  Esquire,  hereby  certify  that  I  have  on  this  day  served  Verizon  Delaware  Inc.  s  letter  to 
 Karen  Nickerson,  Commission  Secretary,  upon  the  participants  below. 
 Dated  at  Philadelphia,  Pennsylvania,  this  30  th  day  of  August,  2002. 


 Via  Electronic  Mail  and  UPS  Overnight  Delivery 


 Hearing  Examiner  Consultant  To  The  Hearing  Examiner  *William  F.  OBrien  John  Antonuk 
 Delaware  Public  Service  Commission  The  Liberty  Consulting  Group  861  Silver  Lake  Blvd.  P.  O.  Box  237 
 Suite  100  65  Main  Street  Dover,  DE  19904  Quentin,  PA  17083 
 Telephone:  302-  739-  3232  Telephone:  717-  270-  4500  Facsimile:  302-  739-  5258  Facsimile:  717-  270-  0555 


 Staff  Case  Manager  Division  Of  The  Public  Advocate  *Patricia  A.  Stowell  *G.  Arthur  Padmore 
 Delaware  Public  Service  Commission  Division  of  the  Public  Advocate  861  Silver  Lake  Blvd.  820  N.  French  Street,  4  th  Floor 
 Cannon  Bldg.,  Suite  100  Wilmington,  DE  19801  Dover,  DE  19904  Telephone:  302-  577-  5077 
 Telephone:  302-  739-  3227  Ext.  10  Facsimile:  302-  577-  3297  Facsimile:  302-  739-  4849 


 Staff  Counsel  Court  Reporter  *Gary  A.  Myers,  Esq.  Corbett  &  Associates 
 Delaware  Public  Service  Commission  1400  French  Street  861  Silver  Lake  Blvd.  Wilmington,  DE  19801 
 Suite  100  Telephone:  302-  571-  0510  Dover,  DE  19904  Facsimile:  302-  571-  1321 
 Telephone:  302-  739-  4247  Facsimile:  302-  739-  4849 


 Public  Advocates  Consultant  AT&  T  Comm.  Of  Delaware,  Inc.  Ralph  Smith  Wendie  C.  Stabler,  Esquire 
 Larkin  &  Associates  Saul,  Ewing,  Remick  &  Saul  15728  Fannington  Road  Post  Office  Box  1266 
 Livonia,  MI  48154  Wilmington,  DE  19899-  1266  Telephone:  734-  522-  3420  Telephone:  302-  421-  6865 
 Facsimile:  734-  522-  1410  Facsimile:  302-  421-  6813 
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 Cable  Telecomm.  Assoc.  Cavalier  Telephone,  L.  L.  C.  Of  Md,  De  &  Dc  Stephen  Perkins 
 John  Conwell  Cavalier  Telephone,  L.  L.  C.  Cable  Telecommunications  2134  W.  Laburnum  Ave. 
 Assoc.  of  MD,  DE  &  DC  Richmond,  VA  23227  2530  Riva  Road,  Suite  316  Telephone:  804-  422-  4517 
 Annapolis,  MD  21401  Facsimile:  804-  422-  4392  Telephone:  410-  266-  9111 
 Facsimile:  410-  266-  6133  Martin  Arias,  Esq. 
 Wayne  ODell,  President  965  Thomas  Drive  Cable  Telecommunications  Warminster,  PA  18974 
 Assoc.  of  MD,  DE  &  DC  Telephone:  267-  803-  4002  2350  Riva  Road,  Suite  316  Facsimile:  267-  803-  4147 
 Annapolis,  MD  21401  Telephone:  410-  266-  9111 
 Facsimile:  410-  266-  6133 
 AT&  T  MCI  Worldcom,  Inc.  Michael  A.  McRae,  Esq.  William  A.  Denman,  Esq. 
 AT&  T  Communications  of  Delaware,  Inc.  Parkowski  &  Guerke,  P.  A.  3033  Chain  Bridge  Road,  3  rd  Floor  116  W.  Water  Street 
 Oakton,  VA  22185  Dover,  DE  19903  Telephone:  703-  691-  6047  Telephone:  302-  678-  3262 
 Facsimile:  703-  263-  2698  Facsimile:  302-  678-  9415 


 Sprint  Comm.  Company,  L.  P.  Wood  &  Wood  Jennifer  A.  Duane,  Esquire  Don  J.  Wood 
 Sprint  Communications  Company,  L.  P.  4625  Alexander  Drive  401  9  th  Street,  NW,  Suite  400  Suite  125 
 Washington,  DC  20036  Alpharetta,  GA  30022  Telephone:  202-  585-  1937  Telephone:  770-  475-  9971 
 Facsimile:  202-  585-  1894 
 Andrew  O.  Isar  Dena  Alo-  Colbeck,  Esq. 
 Association  of  Communications  Enterprises  7901  Skansie  Avenue,  Suite  240 
 Gig  Harbor,  WA  98335  Telephone:  253-  851-  6700 
 Facsimile:  253-  851-  6474 
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 Staff  Counsel  in  DE  PSC  96-  324,  Phase  II  Consultant  To  The  Hearing  Examiner  Francis  J.  Murphy,  Esquire  in  DE  PSC  96-  324,  Phase  II 
 Murphy,  Spadaro  &  Landon  Robert  Stright  824  Market  Street  The  Liberty  Consulting  Group 
 P.  O.  Box  8989  P.  O.  Box  237  Wilmington,  DE  19899  65  Main  Street 
 Telephone:  302-  654-  4600  Quentin,  PA  17083  Facsimile:  302-  654-  4775  Telephone:  717-  270-  4500 
 Facsimile:  717-  270-  0555 


 *  Hand  service  and  e-  mail 
 _____________________________  Julia  A.  Conover 
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 ATTACHMENT  2 
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 State  Statewide  Model  Non-Loop 
 Cost 
 Statewide  Average 
 Non-  Loop  Rate 
 Cost  Ratio  to  New  York  Rate  Ratio  to  New  York  Compliant? 


 NY  $3.50  $5.63  100%  100%  --  DE  $3.87  $6.23  111%  111%  Yes 
10