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News Release
Appeals Court Puts U S WEST Rate Case Appeal On Hold;
Opens Door For Settlement

November 5, 1999 (1999-046)
Contacts: Ron Eachus, Chairman, 503 378-6611; Roger Hamilton, Commissioner 503 378-6611; Joan H. Smith, Commissioner, 503 378-6611; Phil Nyegaard, Telecommunications Administrator, 503 378-6436; Ron Karten, Public Information Officer, 503 378-8962
Salem, OR – The Oregon Court of Appeals today put on hold the appeal of a 1997 U S WEST rate case so that the Oregon Public Utility Commission (OPUC) could consider an agreement between Commission staff and U S WEST that would settle the case and provide more than $200 million in customer refunds.
The Commission had said it would not consider the merits of the stipulation until the Court of Appeals had issued an order authorizing the Commission to conduct such a hearing.
In the 1997 rate case decision, the Commission ordered U S WEST to refund $102 million to customers and to reduce the revenue required to serve customers by $97 million a year. The stipulation, signed in September, provides for an annual refund of $53 million plus interest covering a period from May 1, 1996 until the stipulation is implemented, and a $63 million annual revenue reduction.
The refund obligation has been growing over time with interest. Total refunds as of December 1, 1999 will amount to $222.7 million if the Commission adopts the stipulation. The refund amount would continue to grow until refunds are made.
The Citizens’ Utility Board and the American Association of Retired Persons were also parties to the appeal but did not sign the stipulation.
Despite not having all parties in agreement, the Commission decided it should consider the stipulation because of the length of time it may take to resolve the issue in court and because of new requirements in telecommunications legislation passed in the 1999 legislative session.
If approved by the Commission and if paid by December, the proposed agreement will provide residential customers of U S WEST one-time, per line credits of $101.77 and business customers one-time, per line credits of either $244.26 or $274.79 depending on how complex the telephone service is. The credits will be larger if disbursements are delayed. In addition, the proposed agreement will provide cash refunds to long distance carriers amounting to $30.8 million if paid by December.
The proposed agreement also calls for rate reductions worth $63 million going forward. It will provide residential customers temporary bill credits of $2.47/month, and business customers credits of either $5.93/ or $6.68/month depending on business classification. Customers will receive these credits until the Commission completes the rate design phase and determines permanent rates to be paid by each customer class.
The Commission now will begin a process to gather evidence regarding the stipulation, and with that in hand, review the agreement. The Commission anticipates a response within four months.
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