Medicine Park Telephone Co. v. Oklahoma Corporation Comm.

Medicine Park Telephone Company appeals the Oklahoma Corporation Commission's denial of its application for reimbursement from the Oklahoma Universal Services Fund for reasonable investments and expenses incurred in providing primary universal service to its customers. The FCC created the Interstate Common Line Support (ICLS) program, which was paid from the federal Universal Service Fund. ICLS was available to, among others, rural incumbent carriers and was designed to help such carriers recoup some of the high fixed costs of providing telephone service in areas with fewer customers while also ensuring that their subscriber line charges remained affordable to their customers. Effective January 1, 2012, the FCC changed its rules to limit the operations expenses that may be included in an ICLS calculation. The FCC did not, however, eliminate the legal requirement that Medicine Park and other carriers of last resort continue to provide such services. After its federal ICLS support was eliminated by FCC order, Medicine Park submitted an application for reimbursement to recover $60,707.00 for 2014 and $5,058.92 per month beginning January 2015. The PUD Administrator conducted a thorough review of Medicine Park's application and ultimately recommended approval of the amounts as requested. Various other telecommunications companies, including Sprint, Virgin Mobile, and Verizon, requested denial of any reimbursement. Despite the ALJ's recommendation, the Commission issued an order denying Medicine Park's request for reimbursement. The Commission concluded that there was no dispute that Medicine Park was an eligible service provider qualified for reimbursement, or that it had suffered a reduction in federal universal service fund revenues as a result of the FCC order to eliminate the ICLS. Nevertheless, the Commission ruled that Medicine Park could not recover any funding because the company had made the confidential and proprietary information supporting its application available for onsite review, rather than filing it with the Commission as a matter of public record. Additionally, the Commission would not issue the reimbursement because Medicine Park "failed to prove, and no determination was made as to, whether Medicine Park's rates for primary universal services are reasonable and affordable," or "that the requested funding is necessary to enable Medicine Park to provide primary universal services at rates that are reasonable and affordable." The Oklahoma Supreme Court concluded that although the Commission was not bound by the Administrator's recommendation, the record reflected ample evidence with which to support the Administrator's determination. The Administrator, as well as the dissenting Commissioner, both agreed Medicine Park was entitled to reimbursement of the losses it incurred as a result of the FCC order decreasing federal funding. The Commission's wholesale denial of Medicine Park's request was in error. The Commission's wholesale denial of Dobson's request was in error. View "Medicine Park Telephone Co. v. Oklahoma Corporation Comm." on Justia Law