Annual report of the Georgia Public Service Commission, January 1, 1996 - December 31, 1996

-....-IONS ECTIONS
The Annual Report of The Georgia Public Service Commission
January 1, 1996 - December 31, 1996

he mission ofthe Georgia Public Service Commission is to ensure that consumers receive the bestpossible value in telecommunications,. electric and naturalgas services, and to improve transportation andpipeline safety.
The Georgia Public Service Commission Dave Baker, (R-Atlanta), Chairman Bobby Baker (R-Tucker) Mac Barber, (D-Commerce) Bob Durden, (R-Grayson) Stan Wise, (R-Marietta)

(URRINT DI(lSIONS,
~UTUR~ DIR~(TIONS
During its 117th year of service, the Georgia Public Service Commission continued to respond to economic growth, technological development, and changes in customer concerns and demands while striving to address the monumental changes occurring in the electric, gas
and telecommunications industries. In 1996 particular attention was given to telecommuni-
cations and gas issues, and to changing the PSC's structure and processes to more effectively serve its customers and stakeholders.
With the basic framework for a new competitive era in telephone service established by the State Telecommunications and Competition Development Act of 1995, only minor refinement was necessary to conform to the requirements of the 1996 Federal Telecommunications Act. Several proceedings, on parallel tracks, began to address the key issues necessary to enable local phone competition to work. One case sought to determine industry-wide costs and prices for various services; another studied ways to continue availability of basic phone service to all Georgians at reasonable rates. Fulfilling many of the last steps in the transition from a monopoly to a competitive local telecommunications market, the Commission set resale discount rates for competitors entering the local service market, established interim prices for monthly access to each unbundled loop ("last mile") for facilities-based competitors, processed applications for new certificates of authority to provide local telephone service, arbitrated disputes between new competitors and BellSouth, and selected a long-term solution to enable customers to retain their telephone numbers when choosing another local service provider.
Using comments received in late 1995 about the guidelines and policies necessary to transition natural gas service from regulated monopoly to free-market competition, the Commission submitted proposed legislation to the 1996 General Assembly. "The Natural Gas Consumer Choice Act of 1996," as well as a proposal backed by Atlanta Gas Light Company, opened the restructuring debate and led to resolutions forming Natural Gas Study Committees in both the House and Senate. The two committees, which met jointly in late summer and fall, issued a report in December 1996 which is expected to guide legislative action on the unbundling of natural gas sales and services when the General Assembly convenes in January 1997. While many states have established pilot programs or partially opened natural gas markets to competition, Georgia will continue to take the lead nationally by providing opportunities for choice to all customer classes.

(URR(NT D(CISIONS.
~UTUR~ DIR~(TIONS
Continuedfrom Previous Page
Plans to address electric industry restructuring policy were deferred by the Commission until 1997 when it will conduct a series of workshops and focus -groups. Participants in the workshops will assist the Commission in defining the processes and issues that must be addressed to transition to a competitive electric market by the year 2000.
Deregulation came to the transportation industry in 1994 when federallawpre-empted states from regulating the rates, routes or services of motor carriers of property, thus allowing these carriers to make their own business and pricing decisions. The Commission's jurisdiction over passenger and household goods carriers has remained llnchanged. However, customer complaints and a review of the system for reimbursing household movers' customer losses, led the Commission to change the liability and declaration ofvalue provisions. Beginning in January 1997, the PSC approved a one-year trial of the new simplified forms. Additionally, the Commission continued to promote public safety and protect consumers through its motor carrier safety inspection activities, and the production and distribution of public service announcements to alert the public to stay out of the "No-Zone" (driver's blindspots) when passing trucks on the highways.
Changing industry conditions led the PSC to also address its own operations. As a result, strategic internal reform will position the Commission to better meet its customer and Stakeholder obligations.
The PSC's responsibility to ensure that utility services are reliable and reasonably priced has not changed. Georgians should continue to have access to high quality utility services whether those services are priced in a competitive market or through economic regulation. The Commission's challenges for 1997 and beyond are to anticipate and facilitate those changes that benefit the State and its citizens, to continue to enhance public safety through its natural gas pipeline and commercial motor vehicle inspection programs, and to step-up its consumer protection and information activities.

(IRST QUART~R
JANUARy-MARCil, 1996
Georgia Power's Earnings Reduced and Alternative Rate Plan Approved
PSC actions in the first quarter of '96 resulted in a $48 million reduction in earnings for Georgia Power and approval of a three-year alternative rate plan. A major hurdle in restructuring the electric utilities industry is to fairly address the costs tied up in generating plants. To prepare for a competitive market, Georgia Power was allowed to cover expenses associated with economic development rates, nuclear decommissioning, conservation, and accelerated depreciation of potential stranded investment in electric plant facilities.
Dalton Utilities Fined for Gas Pipeline Safety Violations
Enforcement action against Dalton Utilities for safety-related violations included a penalty of $168,502 and a commitment on the part of the gas system operator to spend up to $4 million to bring its gas system into compliance with existing regulations. The utility paid $68,502 of the assessed penalty and must pay an additional $100,000 if its system does not fully meet all safety requirements within four years.
Telephone Number Portability Solution Selected
In February the Commission ruled that number portability in Georgia would be implemented using the local routing number model (LRN). Georgia is ahead of most states in selecting a solution to enable customers to retain their same telephone numbers no matter which telephone company provides them local service. The local routing number model, which assigns each end-office a ten-digit geographic code that is distinct from the numbers assigned to telephone service subscribers, is expected to be implemented in 1997.

SfCOND QUARYfR
APRIL-JUH(, 1996
Georgia Power's and Savannah Electric's Customers Pay Less for Fuel Costs
Customers of Georgia Power and Savannah Electric paid less per kilowatt hour for their electricity as a result of the PSC's lowering the fuel cost recovery rates of both companies. Savings for Georgia Power's residential customers averaged approximately $12.00 annually; the average savings for a residential customer of Savannah Electric amounted to approximately $9.12 annually.
Natural Gas Competition Guidelines Adopted
In preparation for restructuring natural gas services, the PSC adopted guidelines
designed to promote competition. Atlanta Gas Light Company and United Cities Gas Company were ordered to unbundle their sales services for high use customers, implement a firm transportation rate for large industrial customers and develop pilot programs for residential customers.
Counties with High Truck Fatalities Targeted for Safety Inspection Funding
To augment the efforts of the PSC's 35 enforcement officers and increase the safety of Georgia's highways, federal funds totaling $409,852 were allocated to Cobb, DeKalb and Lowndes counties. These counties, which have some of the highest rates of fatal truck crashes, will train local law enforcement officers who stop vehicles for a traffic violation to also perform safety inspections.
EAS Implemented for 1.4 Million Telephone Customers
Effective April I?, 19%, over 1.4 million telephone customers in 180 exchanges, primarily in rural areas, began to make calls to their communities of interest without incurring long distance charges. Implementation of extended area service for these customers came about following extensive study and balloting throughout the state in 1995.

TIlIRD QUART~R
JULy-HPHt.uU, 1996
Alltel Ordered to Reduce Long Distance Access Rates by $24 Million
PSC actions in early July '96 resulted in a $24 million rate reduction for Alltel Telephone Company prior to the company's effective date for alternative regulation on July 15. Alltel, the state's second largest local telephone service provider with 400,000 mostly rural Georgia customers, was required to lower its intrastate long-distance access charges. The Commission also ordered long distance companies to pass the rate reductions on to Georgia customers. Alltel appealed and the Fulton County Superior Court held the Commission had no authority to order therate reduction. The PSC will request a review by the appellate court in 1997.
Staff Help Protect Athletes and Visitors During 1996 Olympics
Twenty-six of the PSC's enforcement officers and all six pipeline safety inspectors worked with other Georgia law enforcement personnel to protect athletes, visitors and Georgians attending the 1996 Summer Olympics. Responsibilities included transit security for athletes, the permitting and registration of limousines and buses, background checks for chauffeur permits and around-the-clock monitoring of natural gas lines near venues,
Excessive charges and other violations by some companies installing pay phones near Olympic venues led the PSC to order immediate disconnection of any certificate holder found in noncompliance with the rules and regulations for customer-owned-coin/coinless operated telephones.
Marietta Fibernet Approved to Provide Local Telephone Service
Marietta Fibernet became the first municipally-owned business to receive a certificate to provide local telephone service. Much controversy surrounded granting the certificate because of the potential for cross subsidies and the different costs involved in pricing telephone services for privately-held companies and government-owned municipalities that do not pay taxes and other fees. The Commission wanted to assure a level playing field for all competitors providing local telephone service.

~OURTH QUART(R
OnoBu-DHUUU, 1996
Contract Between GPC and Olin Corporation Keeps Jobs in Georgia
Olin Corporation, an employer oflOO Georgians with a payroll of $5.5 million, decided to retain its pl<).nt in Augusta following PSC approval of its special service contract with Georgia Power Company. The special service contract, which includes discounted rates for electricity, was filed in accordance with the Commission's 1995 economic development incentive policy guidelines and allows energy companies to offer industrial and commercial customers incentives to maintain, expand, or locate in Georgia.
AGL Required to Submit Coal Tar Clean-up Schedule
Mter a PSC audit revealed that two-thirds of the more than $15 million in funds, collected from AGL customers since 1992 to cover coal tar cleanup-related costs, paid for lawyers' fees, engineering studies and other administrative expenses, the Commission prohibited future use of clean-up funds for any lawsuit-related expense and required a clean-up schedule for each site. Plant sites are in Athens, Brunswick, Augusta, Savannah, Valdosta, Griffin and Waycross.
Over $3 Million Dollars in Motor Carrier Fees Collected in 1996
Each year the PSC is responsible for collecting and accounting for motor carrier certificate, permit and registration fees. The total fees collected and remitted to the Georgia Department of Administrative Services in 1996 amounted to $3,068,885. Additionally, the federal Motor Carrier Safety Assistance Program (MCSAP) paid for 80% of the cost of inspecting trucks traveling on Georgia's highways.
Barber and Durden Win Bids for Re-election
Commissioners Mac Barber and Bob Durden won their bids for re-election on November 8, 1996. New six-year terms for the two Commissioners begin in January 1997 and run through the year 2002.

KuDOS 0~ NOT ~
Commissioner Stan Wise was elected second vice president of the Southeastern Association of Regulatory Utility Commissioners. In 1999 when Wise assumes the office of President, the GeorgiaCommission will host the organization's annual meeting in Savannah.
The Gas Pipeline Safety Section received a perfect score of 100 on its annual evaluation by the federal Department ofTransportation, Office of Pipeline Safety.
Colonel Bill Chatmon received recognition for his participation in the 1996 Buckle-Up America Program from the Governor's Office of Highway Safety and the University of Georgia.
Captain Bruce Bugg, a recognized hazardous materials expert who serves on several national committees, chaired the Olympic hazardous materials planning group.
To provide the publicgreater access to information, the Commission established an Internet web page on March 1, 1996. Meeting notices, news releases, hearing dates, information about the agency, and Commission orders are among the items available to interested citizens and the PSC's customers. The address is http://www.psc.state.ga.us
The Commission hosted international visitors from Germany, Korea, Holland and Japan in 1996, all of whom sought information on the restructuring taking place in the telecommunications, gas and electric industries.
Utilities Division staff prepared materials for and testified before the Georgia House and Senate Natural Gas Study Committee thus helping to establish the framework for possible legislation to restructure that industry during the 1997 legislative session.
The move toward competitive markets led more people to contact the Consumer Affairs/Public Information Office in 1996. Utility customer complaints increased 25% over 1995 and staff handled a 14% increase in such questions as, "What companies are now providing local telephone service?" and "When can I choose my electric and gas providers?"
To increase public awareness of the changing telecommunications' landscape, Commissioners, industry leaders and others participated in a video conference to discuss the challenges of implementing the 1996 Federal Telecommunications Act. The program was simulcast over the state's distance learning network to a classroom at the University of Georgia, as well as taped for later cablecast throughout the State.
Commissioner Bobby Baker traveled to Albany, Valdosta, Brunswick, Savannah, Dublin, Rome, Dalton, Macon and Warner Robins in July and August to hear from citizens and to discuss utility deregulation.
In September the Commission hired Deborah K. Flannagan as its new chief operating officer. A professional with seventeen years experience in the field of utility regulation, Ms. Flannagan is the first female to serve as Executive Director of the agency.

Bud CJ f t ~ Y 199 6

.Q ..Q

a.

( ..

Revenue
General Assembly Appropriations Federal and Other Funds TOTAL .. "

Budgeted Expenses
Personal Services Regular Operating Expenses Travel/Per Diem/Fees & Contracts Computer Charges Motor Vehicle Purchase Real Estate Rents Other TOTAL

Associated Revenue
Regulated Company Property Taxes Paid Directly to Georgia Department ofRevenue
Regulated Company Fees Collected and Remitted to Georgia State Treasury (Estimate)
Total (Estimate)

Rflrvant Statistics
am$.
Communications/Consumer Affairs
ConsumerInquiries Consumer Complaints Consumer Intra-agency Referrals Consumer Inter-agency Referrals Media Inquiries Print Media Articles

Transportation
VehiclelDriver Safety Inspections Vehicle Violations Driver Violations Hazardous Material Violations

Utilities
Telecommunications, Electric and Natural Gas Cases Gas Safety Inspections

$8,399,352 2,718,206 $11,117,558

$7,213,669

"

712,646

2,189,631

454,424

15,000

324,420

207,768

$11,117,558

$1,050,000
3,823,470 $4,873,470

16,826 4,950 29,214 2,345
988 553
33,964 48,913 31,501 2,313 '
879 483

6eorqiaPublic Service Commission .;
Deborah Flannagan, Executive Director Terri Lyndall, Executive Secretary
Administrative Division
.MqLJ.
Phil McMullan, Director, Budget and Finance Jackie Thomas, Director, Human Resources Harriet Van Norte, Director, Communications/Consumer Affairs
Transportation Division MIK .. iXi ... J. ..
AI Hatcher, Director Lucia Ramey, Director, Compliance and Safety Don McGouirk, Director, Household Goods, Passenger and Rail Safety Bill Chatmon, Chief Enforcement Officer Maria Dorough, Certification and Registration Officer
-Utilities Division
B.B. Knowles, Director Ken Ellison, Assistant to the Director David Burgess, Director, Telecommunications Section Dan Cearfoss, Director, Electric Section Philip Smith, Director, Natural Gas Section Tim Hopkins, Director, Utilities Finance Section Mitch Ingram, Director, Pipeline Safety Section Vacant, Director, Case Management Section
A Publication ofthe Communications/Consumer Affairs Office Harriet K Van Norte, Director/Editor Craig N Kidd, Writer Shadow Grafix, Inc., ProductionlDesign

6(OR6IA PUBLIC S(RVIC( COMMISSION
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244 Washington Street, S.W Atlanta, Georgia 30334-5701