Opinion ID: 382674
Heading Depth: 2
Heading Rank: 2

Heading: The New York State PSC Proceedings

Text: 12 In December 1978 NYT filed a request for a $240.3 million intrastate revenue increase for the twelve-month period ending November 30, 1980, and the New York PSC investigated this request. The PSC staff recommended that $39.867 million of local exchange costs be reclassified as interstate costs associated with interstate FX and CCSA services. Evidently the staff thought that FX and CCSA were comparable to MTS and WATS services and should be allocated a share of the cost of local exchange facilities as in the case of MTS and WATS. In an evidentiary hearing before two state administrative law judges, NYT opposed this change and argued that Congress had vested preemptive authority over the federal-state allocation of joint interstate-intrastate plant in the FCC. See New York Telephone Co. (Recommended Decision), NYPSC 27469, at 88 (Aug. 13, 1979). Although the judges' decision supported NYT, the PSC overturned their ruling and agreed with its staff that interstate FX/CCSA services should be required to bear a share of the costs of local exchange plant computed upon the same basis as the Separations Manual provided for MTS and WATS. See New York Telephone Co. (Final Decision), NYPSC Case 27469, at 25 (Nov. 9, 1979). The PSC gave the telephone company the option of filing a tariff with the PSC to cover the identified costs from FX/CCSA subscribers, thus permitting the PSC to order intrastate toll and message unit decreases totaling almost $40 million on an annual basis. As a result of the PSC order, interstate FX and CCSA subscribers were to be charged with this $40 million while intrastate FX and CCSA subscribers continued to pay a low rate for their local exchange service. A dissenting Commissioner to the PSC order argued that the majority decision was in breach of the agreement entered into by the States with the FCC. 13 On December 4, 1979, NYT filed the tariff revisions which are now in question with the PSC. These require the interstate FX/CCSA customers to pay a much higher surcharge, in addition to the local service charge, then the intrastate FX/CCSA customers. The surcharge for interstate FX/CCSA users is to be $75 monthly, as of February 1, 1980, and $160 a month as of September 1, 1980, 6 while the surcharge for intrastate FX/CCSA users remains at $9.23 per month. The PSC approved these new surcharges. Meanwhile, several FX/CCSA users and competitors filed complaints with the United States District Court for the Southern District of New York, requesting the court to enjoin NYT from collecting the surcharge in absence of a lawful tariff filed with the FCC. United States Transmissions Systems, Inc. v. New York Telephone Co., 80 Civ. 0633 (S.D.N.Y., filed Jan. 31, 1980). By stipulations these matters are held in abeyance pending the outcome of this case.