DA 95-1095 Federal Communications Commission Record 10 FCC Red No. 11
Before the
Federal Communications Commission 
Washington, D.C. 20554
CC Docket No. 91-35
In the Matter of
Policies and Rules Concerning 
Operator Service Access and 
Pay Telephone Compensation
ENF 95-5
MEMORANDUM OPINION AND ORDER 
Adopted: May 15,1995; Released: May 19,1995
By the Chief, Common Carrier Bureau:
I. INTRODUCTION
1. On February 27, 1995, Sprint Communications Co. 
("Sprint") petitioned the Commission to waive application 
of Section 64.1301 of its rules, 47 C.F.R. § 64.1301, regard 
ing interstate access code call compensation. Specifically, 
Sprint seeks authority to pay compensation to competitive 
payphone owners ("PPOs") on a per-call basis, in accor 
dance with the Commission's expressed preference.' Four 
parties filed comments or replies in response to the peti 
tion.2 No party opposed the petition. For the reasons dis 
cussed below, we grant Sprint's petition and allow it to 
begin paying per-call compensation on July 1, 1995.
II. BACKGROUND
2. In April 1992, the Commission adopted the Second 
Report and Order in CC Docket No. 91-35, which estab 
lished a mechanism for interexchange carriers ("IXCs") to 
compensate PPOs for originating interstate access code 
calls. The Commission expressed its preference at that time 
for a per-call compensation mechanism because it would 
encourage PPOs to place their payphones in locations that 
are likely to generate the most calls. The Commission 
found, however, that it was not technically feasible to 
implement such a mechanism at that time.3 Instead, in the 
interests of implementing a compensation mechanism
"quickly and at relatively little cost," the Commission 
adopted on an interim basis a compensation rate of $6 per 
competitive payphone per month. At the same time, the 
Commission directed the Chief, Common Carrier Bureau, 
"to explore whether and how a per-call compensation 
mechanism might be implemented in the future."
3. The Commission further concluded in the Second 
Report and Order that flat-rate compensation obligations 
should be limited to those IXCs that both (1) earn annual 
toll revenues in excess of $100 million, and (2) provide live 
or automated operator services. The Commission deter 
mined that each IXC's share of the monthly charge of $6 
per payphone would be computed by calculating its rela 
tive share of total toll revenues received by IXCs required 
to pay compensation, and multiplying that percentage by 
$6.f J
III. PETITION FOR WAIVER AND COMMENTS
A. The Petition
4. Sprint seeks waiver of Section 64.1301 of the rules to 
allow it to pay compensation based on the actual number 
of access code calls it receives from each competitive 
payphone at a rate of $.25 per call. According to Sprint, it 
currently is in aposition to track and compensate individ 
ual 10XXX and 1-800 access code calls from competitive 
payphones in equal access areas. In support of its waiver 
request, Sprint notes that the Commission granted a similar 
waiver to AT&T.6
B. Comments and Replies
5. Allnet supports Sprint's waiver petition and asks the 
Commission to allow any compensation payer to pay on a 
per-call basis without the need of filing for a waiver.7 
APCC supports Sprint's waiver petition, as long as the 
grant of the waiver is on a temporary basis pending com 
pletion of a rulemaking to establish a comprehensive per- 
call compensation mechanism. APCC further argues that 
the Commission must not rely on the waiver process to 
accomplish per-call compensation objectives that are more 
appropriately the subject of a rulemaking.8 Ameritech also 
supports Sprint's request for a waiver for the same reasons 
that the Commission granted AT&T such a waiver.9
1 Policies and Rules Concerning Operator Service Access and 
Pay Telephone Compensation, Second Report and Order, 7 FCC 
Red 3251, 3252-53 (1992) ("Second Report and Order"). The 
Second Report and Order defines an "access code" as "sequence 
of numbers that, when dialed, connects the caller to the [oper 
ator service provider ("OSP")| associated with that sequence, as 
opposed to the OSP presubscribed to the originating line. Access 
codes include 10XXX in equal access areas and "950" Feature 
Group B dialing (950-OXXX or 950-1XXX) anywhere, where the 
three-digit XXX denotes a particular IXC. Some OSPs use an 
800 number as an access code." Id. at 3251 n.l.
2 See Appendix A for a list of those parties filing comments or 
replies.
3 Second Report and Order, 7 FCC Red at 3252-53.
4 Id. at 3253. The Commission also noted that "[i|f and when
sufficient progress is made in this area, we will initiate a new 
proceeding to make appropriate changes in the compensation 
mechanism that we adopt herein." Id. In the Reconsideration 
Order, adopted in September 1993, the Commission reaffirmed 
its commitment to establishing a per-call compensation mecha 
nism once it becomes technically feasible: "We continue to 
believe that a per-call compensation mechanism is preferable to 
a flat fee per-phone." Memorandum Opinion and Order on 
Reconsideration, 8 FCC Red 7151, 7157 ("Reconsideration Or 
der").
5 Second Report and Order, 1 FCC Red at 3259.
6 Sprint Petition at 1.
7 Allnet Comments at 1.
8 APCC Comments at 1. 
g Ameritech Reply at 1.
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10 FCC Red No. 11 Federal Communications Commission Record DA 95-1095
IV. DISCUSSION
6. The Commission has consistently expressed its pref 
erence for compensating PPOs on a per-call basis for origi 
nating interstate access code calls. 10 Since adoption of the 
payphone compensation mechanism, the Common Carrier 
Bureau has "monitor[ed| progress in this area and work|ed| 
with the industry to explore ways of moving to a per-call 
mechanism." 11 As we found earlier with AT&T's petition 
for waiver, we find here that the developments underlying 
Sprint's petition for waiver represent measurable progress 
toward this end. Waiver of Commission rules is appro 
priate only if special circumstances warrant a deviation 
from the general rule12 and such deviation serves the pub 
lic interest. 13 We find that Sprint has shown that special 
circumstances exist in this case, since it is only the second 
IXC to date that is able to compensate PPOs on a per-call 
basis for interstate access code calls placed to it. We also 
find that Sprint's request for a waiver serves the public 
interest by encouraging PPOs to place their payphones in 
locations that are likely to generate the most calls. Accord 
ingly, we grant Sprint a temporary waiver to permit it to 
begin paying compensation to PPOs on a per-call basis on 
July 1, 1995. The obligations of the other IXCs required to 
pay compensation to PPOs are not affected by our grant of 
this waiver.
7. Allnet requests that all IXCs that are able to pay 
compensation on a per-call basis be permitted to do so 
without the need for filing a waiver. 14 Grant of a generic 
waiver, or evisceration of the waiver process, for all IXCs 
that possess this technical capability is beyond the scope of 
this proceeding. A petition for rulemaking to move the 
industry to a per-call compensation mechanism has been 
filed, however, and action on that petition is pending. 15
8. As a condition to our granting Sprint a temporary 
waiver, we direct Sprint to file a report with the Chief, 
Common Carrier Bureau, at the end of each quarter speci 
fying the total amount paid to PPOs under the per-call 
compensation mechanism, the number of compensable 
calls received by Sprint, and the number of PPOs receiving 
per-call compensation. We also direct Sprint to report the 
nature and ultimate resolution of any compensation dis 
putes between it and any PPOs.
VI. ORDERING CLAUSES
10. Accordingly, IT IS ORDERED, pursuant to Sections 
4(i) and 5(c) of the Communications Act of 1934, as 
amended, 47 U.S.C. §§ 154(i) and 155(c), and Sections 0.91 
and 0.291 of the Commission's rules, 47 C.F.R. §§ 0.91 and 
0.291, that the Petition of Sprint for waiver of Section 
64.1301 of the Commission's rules, 47 C.F.R. § 64.1301, IS 
GRANTED to the extent stated herein.
11. IT IS FURTHER ORDERED that this waiver shall 
become effective on July 1, 1995.
FEDERAL COMMUNICATIONS COMMISSION
Kathleen M.H. Wallman 
Chief, Common Carrier Bureau
APPENDIX A
Parties Filing Comments in This Proceeding
Petition for Waiver
Sprint Communications Co. ("Sprint")
Comments
American Public Communications Council ("APCC") 
Allnet Communication Services, Inc. ("Allnet")
Replies
Ameritech Operating Companies ("Ameritech") 
Sprint
V. CONCLUSION
9. We conclude that Sprint has demonstrated good cause 
for grant of a waiver of Section 64.1301 of the Commis 
sion's rules. Accordingly, we authorize Sprint to pay, as of 
July 1, 1995, compensation to PPOs at the rate of $.25 per 
interstate access code call, pending further action by the 
Commission in this proceeding regarding the appropriate 
permanent compensation mechanism. We further conclude 
that the obligations of the other IXCs required to pay 
flat-rate compensation will not be affected by grant of this 
waiver.
10 See para. 2 and note 4 supra.
11 Reconsideration Order, 8 FCC Red at 7157.
12 Northeast Cellular Telephone Company v. FCC, 897 F.2d 
1164, 1166 (D.C. Cir. 1990).
13 WAIT Radio v. FCC, 418 F.2d 1153, 1159 (D.C. Cir. 1969).
14 Allnet Comments at 1.
15 See Petition of the American Public Communications Coun 
cil and State Payphone Associations to Initiate, on an Expedited 
Basis, A Rulemaking Proceeding to Amend Section 64.1301 of 
the Commission's Regulations to Establish Per-Call Compensa 
tion for Access Code Calls, CC Docket No. 91-35, filed July 19, 
1994.
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