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reasons for arrest that must be included in a sworn report are 

those facts supporting the officer’s suspicion that the individual arrested drove or physically controlled a motor vehicle 

while under the influence of alcohol or drugs. Hoppens does 

not dispute that Shymkewicz’ sworn report included these 

factual reasons or argue that the sworn report was otherwise 

deficient. Accordingly, we affirm the judgment of the district court.

We note that in Sherman v. Neth,

24 the Court of Appeals 

held that a sworn report must contain sufficient assertions to 

allow an inference that the motorist was on a public road or 

private property open to public access. Although we reversed 

the Court of Appeals’ decision on other grounds in Sherman 

v. Neth25 and remanded the cause to the Court of Appeals 

with orders to vacate its decision, we take this opportunity to disapprove the above-stated holding in the Court of 

Appeals’ decision.

Affirmed

Heavican, C.J., participating on brief

24 Sherman v. Neth, 19 Neb. App. 435, 808 N.W.2d 365 (2011).

25 Sherman v. Neth, 283 Neb. 895, 813 N.W.2d 501 (2012).

Telrite Corporation, doing business a

Wireless, appellant, v. Nebraska Pub

Service Commission, appell

___ N.W.2d ___

Filed August 22, 2014. No. S-13-870.

1. Public Service Commission: Appeal and Error. Under Neb. Rev. Stat. 

§ 75-136(2) (Supp. 2013), an appellate court reviews an order of the Nebraska 

Public Service Commission de novo on the record.

2. Appeal and Error. In a review de novo on the record, an appellate court reappraises the evidence as presented by the record and reaches its own independent 

conclusions concerning the matters at issue.

3. Public Service Commission: Appeal and Error. Under Neb. Rev. Stat. § 75-136 

(Supp. 2013), an appellate court must reappraise the evidence on the record as 
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it relates to the penalty issued by the Nebraska Public Service Commission and 

reach an independent conclusion.

4. Appeal and Error. An appellate court is not obligated to engage in an analysis 

that is not necessary to adjudicate the case and controversy before it.

Appeal from the Public Service Commission. Reversed and 

remanded for further proceedings.

Stephen M. Bruckner, Russell A. Westerhold, and Jacqueline 

M. DeLuca, of Fraser Stryker, P.C., L.L.O., for appellant.

Jon Bruning, Attorney General, and L. Jay Bartel for 

appellee.

Wright, Connolly, Stephan, McCormack, Mill

and Cassel, JJ

Connolly,

SUMMARY

Telrite Corporation, doing business as Life Wireless (Telrite), 

was designated as an eligible telecommunications carrier (ETC) 

and a Nebraska eligible telecommunications carrier (NETC) 

by the Nebraska Public Service Commission (PSC). These 

designations permitted Telrite to participate in the “Lifeline” 

program and receive subsidies from federal and state funds 

for the provision of telecommunications service to low-income 

households. Six weeks after receiving its designations, Telrite 

held a 1-day outdoor enrollment event in Omaha, Nebraska. At 

the event, Telrite used the wrong enrollment form, and the PSC 

later received inquiries and complaints from consumers who 

had attended.

The PSC issued a show cause order to Telrite and thereafter revoked Telrite’s ETC designation and ordered it to cease 

and desist from offering Lifeline service in Nebraska. Telrite 

appeals from the PSC order, arguing that the PSC imposed an 

excessive penalty, exceeded its statutory authority, and failed 

to comply with its regulations. We agree that the penalty was 

excessive. Therefore, we reverse the order and remand the 

cause for further proceedings before the PSC.
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BACKGROUND

Statutory Backgro

The Telecommunications Act of 1996 (Telecommunications 

Act)1 established the principle of “universal service,” which is 

broadly defined as the goal of “ensuring that all Americans have 

access to affordable phone service.”2 The Telecommunications 

Act created the federal Universal Service Fund (Federal Fund) 

by requiring telecommunications carriers providing interstate services to contribute to “mechanisms established by 

the [Federal Communications] Commission to preserve and 

advance universal service.”3 Telecommunications companies 

participating in universal service programs are eligible to 

receive support from the Federal Fund if they are designated 

as an ETC.4 The Telecommunications Act provides that state 

commissions are primarily responsible for making ETC designations.5

 In Nebraska, the PSC makes ETC designations.6

Among the mechanisms established by the Federal 

Communications Commission (hereinafter FCC) and supported 

by the Federal Fund is the Lifeline program, under which 

qualified low-income consumers pay reduced charges for 

voice telephone services.7 ETC’s participating in the Lifeline 

program receive a monthly disbursement of $9.25 from the 

Federal Fund for each qualified consumer.8 Lifeline support is 

limited to a single subscriber per household, and eligibility is 

determined by the subscriber’s income or participation in government programs directly related to income.9

1 Pub. L. No. 104-104, 110 Stat. 56 (codified as amended at scattered 

sections in title 47 of U.S. Code).

2 WWC Holding Co. v. Public Service Com’n, 44 P.3d 714, 717 (Utah 2002).

3 47 U.S.C. § 254(d) (2006).

4 47 U.S.C. § 254(e).

5 47 U.S.C. § 214(e)(2) (2006).

6 Schumacher v. Johanns, 272 Neb. 346, 722 N.W.2d 37 (2006).

7 47 C.F.R. §§ 54.101 and 54.401(a)(1) (2013).

8 47 C.F.R. § 54.403(a)(1) (2013).

9 See, 47 C.F.R. § 54.409(a) (2013); 291 Neb. Admin. Code, ch. 10, 

§ 006.04A (2012).
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The Telecommunications Act also authorized states to create their own universal service funds and maintain them with 

mandatory contributions from providers of intrastate telecommunications services.10 The Nebraska Legislature exercised 

this power by enacting the Nebraska Telecommunications 

Universal Service Fund Act (NTUSFA).11 The NTUSFA created the Nebraska Telecommunications Universal Service Fund 

(Nebraska Fund) in order to advance the state universal service 

effort.12 The Nebraska Fund receives contributions from surcharges collected on all “end-user telecommunications” provided in Nebraska commerce.13 The NTUSFA also charged the 

PSC with the creation of the Nebraska Telephone Assistance 

Program to promote universal service for low-income households and to determine eligibility guidelines and standards for 

the federal and Nebraska support mechanisms.14

In addition to making ETC designations as provided by the 

Telecommunications Act, the PSC determines the telecommunications providers that are eligible for support from the 

Nebraska Fund. The PSC denominates a provider eligible 

to receive support from the Nebraska Fund as a “Nebraska 

Eligible Telecommunications Carrier” (NETC).15 The PSC’s 

regulations require ETC’s receiving federal support to participate in Nebraska’s universal service program,16 in effect 

requiring an ETC to receive an NETC designation. An NETC 

providing services under the Lifeline program is entitled 

to $3.50 per month for each qualified consumer from the 

Nebraska Fund.

Factual and Procedural Backg

Telrite is a Georgia corporation with a certificate of authority to do business in Nebraska. Telrite received its first ETC 

10 47 U.S.C. § 254(f).

11 Neb. Rev. Stat. §§ 86-316 to 86-329 (Reissue 2008).

12 § 86-324(1).

13 291 Neb. Admin. Code, ch. 10, § 002.01 (2012).

14 § 86-329(1).

15 291 Neb. Admin. Code, ch. 10, § 001.01R (2012).

16 291 Neb. Admin. Code, ch. 10, § 004.04A (2012).
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designation in 2010 and has rapidly become “one of the 

largest Lifeline ETCs in the country,” with designations in 

approximately half of the states. Telrite often attracts customers by holding outdoor tent events at which it gives qualified 

applicants a “free” cell phone. If an applicant is qualified for 

the Lifeline program, the cell phone is activated onsite. In 

February 2013, Telrite filed an amended application with the 

PSC seeking designation to participate in the Lifeline program 

in Nebraska as a prepaid wireless service.

On May 29, 2013, the PSC issued an order designating 

Telrite as both an ETC and NETC. The order stated that Telrite 

had committed to comply with all of the Nebraska-specific 

requirements for ETC’s and NETC’s, including the requirement 

to use the form approved by the PSC. The order did not direct 

Telrite to comply with any specific requirements other than the 

use of a particular form.

On July 12, 2013, Telrite held its first enrollment event in 

Nebraska at an outdoor tent in Omaha. Consumer interest was 

heavy, and the PSC was later notified that applicants had to 

“wait[] in line for extended periods of time in over ninety (90) 

degree heat with no shelter or water.” As reported by a local 

media outlet, the police were called to the event when “tempers 

flared on a hot day.” The PSC fielded a number of inquiries 

from consumers in the days following the event. The questions 

included: “When was the free phone they received going to 

be hooked up?”; “When were the tents going to be open again 

and where?”; “Were there any phones left and could they pick 

it up at the office?”; “Why was the media coverage not better 

as to when and where this event was taking place?”; “Why 

were there only tents in Omaha and not in Lincoln?”; “Why 

wasn’t more information provided in the [PSC’s] office about 

where there are free phones being handed out?”; and “Why 

was the information about the free phone give away not made 

more public?” The PSC also received a report that Telrite’s 

representatives had run out of cell phones and told prospective applicants to return on Sunday, July 14, but that when 

the consumers did so, Telrite representatives were not present. 

After the PSC contacted Telrite, it voluntarily ceased enrolling 

additional customers in Nebraska on July 15.
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The PSC issued an order on July 30, 2013, demanding that 

Telrite show cause why its ETC designation should not be 

revoked or administrative penalties levied against it. The order 

alleged that Telrite had not contacted the PSC before beginning operations in Nebraska, failed to use the form approved 

by the PSC, and handed out flyers that failed to state that the 

PSC made the final eligibility determination. In its answer, 

Telrite “apologize[d] for the errors made during the launch 

of its Lifeline service in Nebraska” and “humbly ask[ed] the 

[PSC] to afford it the opportunity to correct its mistakes.” 

Telrite admitted that it had “failed to implement state-specific 

customization of [Telrite’s] FCC-default standard forms” and 

control “unruly behavior in the queue.” Explaining that turnout 

had exceeded expectations, Telrite promised to hire security 

for future events and make water available if the temperature 

exceeded 85 degrees.

The PSC held a hearing on the show cause order on August 

27, 2013. Telrite’s counsel began by stating that the PSC had 

the power to order “revocation, fine, some other remedy, 

whatever you deem appropriate,” but that its decision should 

be “guided by . . . the public interest.” Brian Lisle, Telrite’s 

president, admitted that Telrite had used the form applicable 

in states where the FCC is responsible for ETC designations 

instead of the form approved by the PSC. Lisle testified that 

he had sent an e-mail to Telrite’s compliance department about 

the Nebraska-specific requirements, but that there had been “a 

lack of follow-up on communication there.” Lisle testified that 

the independent contractor who administered the Omaha event 

had received “FCC training” but not “[Nebraska Telephone 

Assistance Program] training.”

Lisle also testified about the status of persons who had 

received cell phones at the Omaha event and Telrite’s plan 

to “re-enroll” those individuals. Lisle stated that about 944 

people had applied at the event and that Telrite approved 796 

of the applications onsite. Unless they had contacted Telrite 

to cancel, the approved applicants were receiving service as 

of the hearing. Telrite, however, had not received any disbursements from either the Federal Fund or Nebraska Fund. 

Lisle testified that Telrite intended to contact its Nebraska 
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customers and ask them to complete and return the Nebraska 

application. Lisle promised that, in the future, Telrite would 

use “employee teams” in Nebraska and abstain from giving 

away free cell phones onsite. Instead, Telrite would take applications and later mail cell phones to the applicants approved 

by the PSC.

One of the concerns expressed by commissioners was the 

potential for households receiving multiple Lifeline subsidies. 

One commissioner noted that the FCC was trying to combat 

a “run on the fund” by ineligible persons and had removed 

“millions of people” from the Lifeline rolls, which suggested 

to the PSC that “there is a lot of waste and a lot of abuse 

there.” At the Omaha event, Telrite’s representatives validated 

applicants’ information onsite by comparing the information 

given by applicants to a database of current Lifeline enrollees. 

Lisle testified about Telrite’s enrollment process, including 

the steps intended to flag “duplicate[s].” Lisle admitted that 

Telrite’s representatives at the Omaha event did not have 

access to the database of Nebraska enrollees maintained by 

the PSC.

Telrite cited statistics suggesting that low-income Nebraskans 

are underserved by Lifeline providers. Telrite’s counsel stated 

that the “penetration rate”—the percentage of eligible households that are enrolled in the Lifeline program—is 40 percent 

nationally but only 6 percent in Nebraska. He further stated 

that several of Nebraska’s neighboring states were outperforming it, noting that the penetration rate was 42 percent in 

Kansas, 29 percent in Missouri, and 28 percent in Iowa.

On September 17, 2013, the PSC entered an order revoking Telrite’s ETC designation and directing Telrite to cease 

and desist from offering services as a Lifeline provider in 

Nebraska. In its order, the PSC identified three main areas of 

concern that supported its decision. First, Telrite had failed to 

comply with Nebraska Telephone Assistance Program requirements a mere 6 weeks after it had promised to do so during 

the application process. Second, Telrite had substantial experience with the Lifeline program and was therefore less deserving of leniency. The third factor identified by the PSC was a 

lack of oversight. The PSC found Telrite’s failures “even more 
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disturbing” given the heightened scrutiny that the Lifeline program had borne in recent years. The order generally referred 

to violations of the PSC’s “rules, regulations and orders” but 

did not identify any specific rules, regulations, or orders that 

Telrite had violated.

ASSIGNMENTS OF ERROR

Telrite assigns, restated and reordered, that the PSC erred 

by (1) ordering an excessive penalty; (2) determining that it 

possessed the authority to revoke an ETC designation; (3) 

concluding that Telrite had violated the PSC’s rules and regulations; and (4) failing to follow its rules and regulations governing ETC’s and NETC’s.

STANDARD OF REVIEW

[1,2] Under Neb. Rev. Stat. § 75-136(2) (Supp. 2013), 

an appellate court reviews an order of the PSC de novo on 

the record. In a review de novo on the record, an appellate 

court reappraises the evidence as presented by the record and 

reaches its own independent conclusions concerning the matters at issue.17

ANALYSIS

Excessive Pena

Telrite argues that the penalty meted out by the PSC in its 

order—revocation of Telrite’s ETC designation and an order 

to cease and desist from providing Lifeline services—was 

excessive. Telrite emphasizes that it accepted responsibility for its mistakes, has a “rigorous application and review 

process,” and proposed corrective measures.18 Furthermore, 

Telrite notes that the underlying violation “amount[ed] to 

little more than using the wrong form.”19 The PSC argues that 

Telrite has understated the significance of its conduct, especially in light of the concern for fraud in the Lifeline program, 

17 In re Margaret Mastny Revocable Trust, 281 Neb. 188, 794 N.W.2d 700 

(2011).

18 Brief for appellant at 22.

19 Id. at 11 (emphasis in original).
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and that the Omaha event occurred a mere 6 weeks after 

Telrite received its designations. Although we do not express 

an opinion whether lesser penalties are justified, we agree 

with Telrite that revocation and a cease-and-desist order were 

not warranted on the facts before us.

[3] As an initial matter, the parties disagree whether we 

should defer to the PSC’s penalty determination. Telrite asserts 

that, because § 75-136 authorizes de novo review, we do not 

owe any deference to the PSC’s determination. The PSC maintains that our previous decisions require us to affirm the sanction ordered by the PSC absent “‘arbitrar[iness] or an ‘abuse 

of discretion.’”20 In those cases, we stated that determinations 

by the PSC are a matter peculiarly within its expertise and 

involve a breadth of judgment and policy determination that 

an appellate court should not disturb in the absence of a showing that the PSC’s action was arbitrary or unreasonable.21 But 

we made these statements before 2013, when the Legislature 

amended § 75-136 to provide a “de novo on the record” standard of review.22 Before 2013, a party appealed from the PSC 

under the Administrative Procedure Act and an appellate court 

reviewed the PSC’s order for errors appearing on the record.23

Under this standard of review, our inquiry was limited to 

whether the decision conformed to the law, was supported 

by competent evidence, and was neither arbitrary, capricious, 

nor unreasonable.24 Our review of pre-2013 cases shows that 

the deference accorded to the PSC was tied to the deferential standard of review applied by an appellate court under 

the Administrative Procedure Act. We therefore reject the 

PSC’s contention that it is due the same degree of deference 

20 Brief for appellee at 32, citing In re Proposed Amend. to Title 291, 264 

Neb. 298, 646 N.W.2d 650 (2002).

21 In re Claims Against Atlanta Elev., Inc., 268 Neb. 598, 685 N.W.2d 477 

(2004); In re Application of Jantzen, 245 Neb. 81, 511 N.W.2d 504 (1994).

22 2013 Neb. Laws, L.B. 545, § 5.

23 See, e.g., Chase 3000, Inc. v. Nebraska Pub. Serv. Comm., 273 Neb. 133, 

728 N.W.2d 560 (2007).

24 Id.
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it enjoyed before the Legislature amended § 75-136. Under 

the amended § 75-136, an appellate court must reappraise the 

evidence on the record as it relates to the penalty issued by the 

PSC and reach an independent conclusion.25

Our de novo review of the record leads us to conclude that 

the revocation and cease-and-desist order was not warranted. 

In reaching this conclusion, we consider the purposes and 

goals of the Telecommunications Act and the NTUSFA. In 47 

U.S.C. § 254(b), the Telecommunications Act identifies the 

following “[u]niversal service principles”: (1) “Quality services . . . at just, reasonable, and affordable rates”; (2) access 

to advanced telecommunications to all regions of the United 

States; (3) telecommunications access to “low-income consumers and those in rural, insular, and high cost areas”; (4) “an 

equitable and nondiscriminatory contribution to the preservation and advancement of universal service” by telecommunications providers; (5) “specific, predictable and sufficient” 

federal and state support mechanisms; and (6) the provision of 

access to advanced telecommunications services for schools, 

health care providers, and libraries. The NTUSFA similarly 

includes these “principles” as undergirding the state’s policy of 

preserving and advancing universal service. In addition to these 

six principles, the NTUSFA includes the principle of keeping 

the costs of administering the Nebraska Fund to a minimum.26

But the Legislature has identified the purpose of the NTUSFA 

as “ensur[ing] that all Nebraskans, without regard to their 

location, have comparable accessibility to telecommunications 

services at affordable prices.”27

The PSC’s termination of Telrite’s participation as a Lifeline 

provider in Nebraska does not further the principles of universal service. High among the goals of the federal and state 

universal service effort is the provision of telecommunications service to low-income households. Lisle testified that 

about 6 percent of eligible households in Nebraska participate 

25 See In re Margaret Mastny Revocable Trust, supra note 17.

26 § 86-323.

27 § 86-317.
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in the Lifeline program, compared to 40 percent nationally. 

Furthermore, while the problems that occurred at the Omaha 

event were due in part to Telrite’s poor planning, they were 

exacerbated by a larger-than-expected turnout indicative of an 

unmet demand for Lifeline service in Nebraska. Additionally, 

the complaints fielded by the PSC in the wake of the Omaha 

event show that consumers were largely concerned about having greater access to Telrite’s offerings. Taken as a whole, the 

record suggests that there are a substantial number of lowincome households in Telrite’s intended service area that would 

benefit from its presence in the marketplace.

Moreover, the PSC’s concern for fraud in the Lifeline program does not justify the penalty. During the hearing held on 

the show cause order, the commissioners noted that the FCC 

was currently combatting a “run on the fund” by ineligible 

applicants and had removed “millions of people” from the 

Lifeline rolls. But there is no indication in the record that 

Telrite facilitated applications by ineligible persons, and as 

the PSC admits, Telrite has not received any support from 

either the Federal Fund or Nebraska Fund for the individuals 

it approved.

Telrite, using a “pool[ed]” database of current Lifeline subscribers created from the records of 20 to 24 ETC’s, rejected 

more than 15 percent of the applications it received due to 

ineligibility concerns. Lisle testified that Telrite would continue to run applicants’ information through this database 

before transmitting the application to the PSC as an extra 

precaution against duplicates. Furthermore, we note that there 

is substantial overlap between the FCC’s eligibility criteria, 

which were incorporated into the forms used by Telrite, and the 

PSC’s eligibility criteria.28

Telrite admitted that it made mistakes, but these initial 

administrative missteps occurred over the course of a single 

day and were immediately curtailed. Furthermore, these errors 

are easily remedied. Telrite submitted to the PSC a proposed 

28 Compare 47 C.F.R. § 54.409(a) with 291 Neb. Admin. Code, ch. 10, 

§ 006.04A.
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process to “re-enroll” its Nebraska subscribers using the correct form and flyers to be handed out at future events stating 

that the PSC would make the final eligibility determination. 

The PSC did not object to either of these proposals.

We need not express an opinion regarding the appropriateness of lesser sanctions. The NTUSFA provides that the PSC 

has the power to withhold funds if a telecommunications 

company fails to comply with the PSC’s orders or regulations 

and, under Neb. Rev. Stat. § 75-156 (Supp. 2013), administratively fine any person who violates the NTUSFA.29 We note 

in passing that noncompliance with the PSC’s orders violates 

the NTUSFA30 and may subject a telecommunications provider 

to fines under § 75-156. But the only order in the record that 

Telrite violated was the May 29, 2013, order, which stated that 

Telrite must use a Nebraska-specific form. Under § 75-156(1), 

the PSC has the discretion to issue fines of up to $10,000 per 

day if it finds, by clear and convincing evidence, that “any 

term, condition, or limitation of any certificate, permit, or 

authority issued by the [PSC]” or “any rule, regulation, or 

order of the [PSC]” was violated. Should the PSC consider the 

imposition of an administrative fine on remand, § 75-156(5) 

directs it to consider the gravity of Telrite’s violation and 

its good faith efforts to achieve compliance after being notified of the violation. And, of course, Telrite’s conduct at the 

Omaha event may be considered should future compliance 

problems occur.

Remaining Assig

of Erro

[4] Because we conclude that the penalty ordered by the 

PSC was excessive, we do not reach Telrite’s remaining assignments of error. An appellate court is not obligated to engage 

in an analysis that is not necessary to adjudicate the case and 

controversy before it.31

29 § 86-324(2)(c) and (f).

30 See § 86-324(2)(b).

31 Lang v. Howard County, 287 Neb. 66, 840 N.W.2d 876 (2013).
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CONCLUSION

From our de novo review of the record, we conclude that 

the revocation and cease-and-desist order imposed by the PSC 

was excessive. We do not make light of Telrite’s failure to 

use the correct form a mere 6 weeks after the PSC ordered it 

to do so. Nor do we express an opinion whether lesser sanctions are justified. But, considering the low participation rate 

of Nebraska households in the Lifeline program and the purposes of both the Telecommunications Act and the NTUSFA, 

revocation and a cease-and-desist order were not warranted 

by Telrite’s failure to use the correct form during a 1-day 

event. Accordingly, we reverse, and remand to the PSC for 

further proceedings.

 Reversed and remanded

further proceedings

Heavican, C.J., participating on brief