CRTC erred in not allowing Aliant to carry forward unused monies from price cap

Aliant Telecom Inc. says the CRTC was mistaken when it ruled that the Atlantic telco couldn’t carry forward $6.4 million of unused price increase room under the previous price cap period to the current period. The company wants to be able to draw down the $6.4 million from its deferral account, and filed a Part VII on August 11 to that end. It seeks to review and vary Telecom Decision 2004-42, which denied Aliant’s original request in April. In its Part VII, Aliant notes that the commission erred in allowing Manitoba Telecom Services Inc. (MTS) to carry forward unused portions of its contribution charge. "The company also submits that the commission’s determinations in paragraph 22 of Decision 2004-42 regarding the MTS deferral account adjustment to reverse the recovered portion of MTS’ contribution-revenue percent charge exogenous adjustment shows that, contrary to the statement in paragraph 59 of Decision 2004-42, that the commission did intend to allow for the carry over of unused room. By approving the adjustment to MTS’ capped revenue base by 2.6% rather than by 4.5%, the commission has allowed for the carry over of MTS’ unused room to reflect the actual level of recovery by MTS," reads the August 11 application. Mark Connors, manager of regulatory affairs at Aliant Telecom, believes the situations at Aliant and MTS are similar, and doesn’t understand the two opposing decisions. "From our point of view, MTS was in a very similar position. They had price cap room that they didn’t use in the first price cap period and the commission adjusted their deferral account to take care of that. And we’re saying we should be treated the same way," he tells Network Letter. Aliant says that at the end of the previous price cap regime, local telephone rates in the former MT&T region were $6.4 million lower than what they could have been, calculated at an annualized total under the price cap index. The Atlantic ILEC should as a result be able to drawn down from its deferral account these monies. "The company submits that it should not be penalized twice for having provided this benefit to customers (first, during the first price cap period by having less revenue than it otherwise would have had and second, during the second price cap period by incurring a deferral account obligation to reverse rate increases that did not happen). By denying the carry-over of the unused price cap room, the commission is acting contrary to its stated objective of balancing the interests of the three main stakeholders in telecommunications markets, i.e., customers, competitors and incumbent telephone companies," reads Aliant’s Part VII. Connors explains: "From our perspective the commission is, by making us do the adjustment to the deferral account, they are making us reverse things that didn’t happen in the first place…From our perspective it’s improper for the commission to reverse an event that in fact did not happen."

CRTC erred in not allowing Aliant to carry forward unused monies from price cap

News | September 1, 2004

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