Opinion ID: 757345
Heading Depth: 2
Heading Rank: 5

Heading: 9000 Minutes Per Circuit

Text: 64 The IXC petitioners next argue that the Commission's decision to abandon the admittedly imperfect interim rate structure for tandem-switched local transport that was based on an estimated 9000 minutes of use for each circuit 16 is arbitrary and capricious. According to the IXC petitioners, the method adopted by the FCC in the Order--compiling actual minutes of use per circuit in a year prior to implementation of the Order and using this figure as an estimate for future years--is incompatible with the agency's prior determination that the benefits to be obtained from a more individualized calculation were outweighed by the administrative convenience of a uniform figure. IXC Petitioners' Joint Brief at 68. The FCC justifies its position on the belief that its 9000 minute usage estimate is too high; but the IXC petitioners contend that, because competition presumably will increase usage of these circuits, the new method of calculating rates based on the prior year's annual use virtually guarantees that these usage estimates will be low by a substantial amount for every LEC. Order p 206. Moreover, the IXC petitioners argue that the Commission has not explained its rationale for selecting this option over other, more suitable alternatives. According to the petitioners, because the Commission failed to state any purpose for its decision to change methods, other than the inaccuracies of the old method, its choice of an even more inaccurate method is arbitrary and capricious. 65 The IXC petitioners' central argument fundamentally misapprehends the FCC's Order. Contrary to their assertion that the FCC's new method contemplates calculating a fixed usage estimate based on circuit usage for the year prior to implementation of the Order, and in turn applying that figure to all future years, the FCC's new rules require an annual recalculation of usage estimates based on the actual minutes of use during the prior year[ ]. Id. (emphasis added). The FCC explained that its shift from an arbitrary usage estimate number that consistently overstates minutes of use to a more precise measure of actual usage is consistent with the Commission's goals of moving toward cost-causational rates. The agency's choice of a reasonable solution from a number of acceptable alternatives is within the agency's discretion and is not arbitrary or capricious. 66