BEFORE THE - Unlimited Data Plans, Internet Service, & TV
Before the
FEDERAL COMMUNICATIONS COMMISSION
Washington, D.C. 20554
|In the Matter of |) | |
| |) | |
|Joint Application by SBC Communications Inc., |) | |
|Illinois Bell Telephone Company, Indiana Bell |) | |
|Telephone Company Incorporated, The Ohio Bell |) |WC Docket No. 03-167 |
|Telephone Company, Wisconsin Bell, Inc., and |) | |
|Southwestern Bell Communications Services, Inc. |) | |
|for Provision of In-Region, InterLATA Services |) | |
|in Illinois, Indiana, Ohio, and Wisconsin |) | |
JOINT REPLY AFFIDAVIT OF
JUSTIN W. BROWN, MARK J. COTTRELL AND MICHAEL E. FLYNN
REGARDING BILLING
TABLE OF CONTENTS
|SUBJECT |PARAGRAPH |
|INTRODUCTION |1 |
|PURPOSE OF AFFIDAVIT |4 |
|INDEPENDENT THIRD-PARTY TESTING |10 |
|BearingPoint |11 |
|Ernst &Young (“E&Y”) |18 |
|RECONCILIATION Issues |20 |
|lines in service billing and usage allegations |36 |
|at&t analysis |38 |
|MCI Analysis |49 |
|LINE LOSS ISSUES AND SERVICE ORDER ACCURACY |54 |
|sbc mIDWEST’S BILLING DISPUTES IN CONTEXT |75 |
|SBC MIDWEST’S processes to ensure bill accuracy |81 |
|BILLING DISPUTES RESOLUTION |90 |
|MISCELLANEOUS clec aLLEGATIONS |108 |
|AT&T Corporation |108 |
|Choice One Communications Incorporated |117 |
|CIMCO Communications Incorporated |119 |
|Forte Communications Incorporated |120 |
|Indiana Office of Utility Consumer Counselor (“IOUCC”) |123 |
|MCI |125 |
|Mpower |130 |
|Northern Telephone and Data Corporation |133 |
|Ohio Consumers’ Counsel |137 |
|TDS Metrocom |138 |
|Z-Tel |144 |
|CONCLUSION |147 |
Schedule of Attachments
|Attachment A |Letter to AT&T July 25, 2003 (Confidential) |
|Attachment B |Letter to AT&T August 20, 2003 (Confidential) |
|Attachment C |TDS E-Mail June 18, 2003 |
|Attachment D |Letter to AT&T August 6, 2003 (Confidential) |
|Attachment E |Letter to TDS August 6, 2003 (Confidential) |
We, undersigned, being of lawful age and duly sworn upon our oaths, do hereby depose and state as follows:
INTRODUCTION
1. My name is Justin W. Brown. I am General Manager – Regulatory Support for SBC Midwest. [1] My background and qualifications are provided in my initial affidavit regarding SBC Midwest’s Local Service Center (“LSC”) and Local Operation Centers (“LOC”), which was filed in this proceeding.[2]
2. My name is Mark J. Cottrell. I am Executive Director – Long Distance Compliance – OSS for SBC Midwest. My background and qualifications are provided in my initial affidavit regarding SBC Midwest’s Operations Support Systems (“OSS”), which was filed in this proceeding.[3]
3. My name is Michael E. Flynn. I am Director – Billing Project Management for SBC Services, which includes SBC Midwest. My background and qualifications are provided in my initial affidavit regarding SBC Midwest’s billing systems, which was filed in this proceeding.[4]
PURPOSE OF AFFIDAVIT
4. As explained in its Application, SBC Midwest provides CLECs with accurate, timely, and auditable billing and usage information in compliance with the requirements of the Act. This joint reply affidavit responds to the comments of AT&T Corp., Choice One Communications Inc., CIMCO Communications Inc. (“CIMCO”), Forte Communications Inc. (“Forte”), Indiana Office of Utility Consumer Counselor (“OUCC”), Worldcom Inc. d/b/a MCI (“MCI”), Mpower Communications Corp. (“Mpower”), Northern Telephone and Data Corporation (“NTD”), Ohio Consumers’ Counsel (“OCC”), TDS Metrocom, LLC (“TDS”) and Z-Tel Communications Inc. (“Z-Tel”).
5. At the outset, it is important to put these comments into context. First, SBC Midwest’s billing OSS processes and procedures are exceedingly complex and involve extremely large commercial billing volumes. For example, every year, SBC Midwest’s Carrier Access Billing System (“CABS”) bills more than $3 billion a year and generates more than 6,000 monthly CLEC bills for a variety of UNE and interconnection products. Every month, CABS processes more than 4 billion usage records, including more than 1 billion UNE-P CLEC usage records. SBC Midwest’s Resale Billing System generates more than 500 CLEC bills every month, and processes more than 7 million usage records every month. SBC Midwest completed approximately 220,000 rate table updates, including price schedule work, updates to support access products, tariff rate changes, and rate updates to support the implementation of new products. More than 150,000 of these rate table updates were to support CLEC billing in CABS. SBC Midwest has processed approximately 4.5 million UNE-P service orders in 2003 alone; over 8 million UNE-P orders since the beginning of 2002. In SBC’s Midwest region, there are nearly 3 million UNE-P circuits in service today, in addition to over 1 million UNE-L and Resale circuits in service.
6. Second, contrary to CLECs’ claims, these billing systems, processes and procedures were the subject of a comprehensive independent third-party review that SBC Midwest passed with flying colors. Specifically, BearingPoint conducted extensive reviews and transaction testing in six different areas related to daily usage information, monthly bills and overall billing support to CLECs. The test also included CLEC interviews on their experiences with SBC billing processes and procedures.[5] BearingPoint concluded that SBC Midwest satisfied 95 out of 95, or 100%, of the applicable test criteria.
7. Third, SBC Midwest undertook a database reconciliation to ensure the accuracy of the CABS database. An independent auditor, Ernst and Young (“E&Y”) was engaged to validate the accuracy of this reconciliation, verify the current database accuracy, and perform a comprehensive review of SBC Midwest’s rate accuracy by reviewing recurring, non-recurring, and usage charges.
8. Fourth, given the extraordinary complexity of SBC Midwest’s billing systems, processes and procedures and the substantial commercial billing volumes handled by SBC Midwest, occasionally there will be billing discrepancies that need to be reviewed and, if appropriate, corrected. However, as will be discussed in more detail below, the billing claims raised by the CLECs do not reflect systemic wholesale billing problems. Many of the claims raised by CLECs describe incidents that are outdated or involve small disputed amounts, and thus do not indicate any competitive impact on CLECs. Other claims raised by CLECs are so general and lacking in detail that it has been difficult for SBC Midwest to investigate and respond to their claims. Although CLECs do raise a few isolated claims of billing errors, none of the their claims demonstrate any systemic issues with SBC Midwest’s billing OSS, and or succeed in rebutting SBC Midwest’s showing that its billing OSS are compliant with checklist item 2.
9. Fifth, all 5 Midwest state commissions have determined that SBC has indeed met the 14-point checklist, including checklist item 2.
INDEPENDENT THIRD-PARTY TESTING
10. It is axiomatic that in a proceeding such as this there will always be issues, some of which SBC Midwest and CLECs may not agree. However, that is precisely what third-party testing is designed for and why it should be given substantial weight in this application. SBC Midwest’s billing systems have been tested by independent third-parties, and both the results of BearingPoint’s testing, as well as E&Y’s subsequent tests of the UNE-P reconciliation and rating table accuracy undermine any claim that SBC Midwest’s billing systems are deficient. It is not surprising, though, that the CLECs are now second-guessing the scope and results of these tests. Interestingly, the CLECs even question the scope of the BearingPoint OSS test, a test for which the CLECs provided substantial input to the Master Test Plan (“MTP”).[6]
BEARINGPOINT
11. As described in SBC Midwest’s initial filing, BearingPoint’s Bill Production and Distribution Process Evaluation (PPR 13), examined SBC Midwest’s processes and procedures to prepare CLEC bills on a monthly basis, to distribute those bills to CLECs in a timely manner, and to archive historical bills.[7] It involved a review of the documentation that supports the bill production and distribution process, interviews of SBC subject matter experts involved in bill production and distribution, interviews with the CLECs to discuss their experiences in receiving accurate and timely bills, and an examination of results of its own transaction testing in TVV 9.[8]
12. Likewise, in its Functional Carrier Bill Evaluation (TVV 9), BearingPoint conducted a transaction-based analysis of the accuracy and timeliness of SBC Midwest’s bills that complemented the PPR 13 test. The results from both tests provide substantial evidence that SBC Midwest’s bills are accurate.
13. In its criticism of the test, ACN referenced comments made by others in the Illinois 271 proceeding which noted that since BearingPoint did not actually submit payments to SBC Midwest, there was no way for it to test SBC Midwest’s application of payments or late charges.[9] It is true that, as the Test CLEC, BearingPoint did not actually render payment to SBC Midwest. It did, however, conduct an extensive review of SBC Midwest’s procedures for processing payment transactions and making adjustments to CLEC accounts.[10] The results of this review show that SBC Midwest completely satisfied the associated test criterion.[11] This same process for testing the processing of bill payments and adjustment was used by BearingPoint in every state and region where it conducted OSS testing. SBC Midwest notes that the issue of payments and late charges did not surface during the collaborative workshop held earlier this year in Michigan on SBC Midwest’s Bill Auditability and Dispute Resolution Plan.[12] As indicated by the following SBC Midwest responses to specific billing issues raised in this proceeding, however, SBC Midwest has and will continue to be diligent and thorough in addressing any billing concern brought to its attention.
14. Both AT&T and MCI claim that the BearingPoint test of SBC Midwest’s billing capabilities did not include testing of CABS accuracy since the conversion or the reconciliation.[13] This is not accurate. As shown below, BearingPoint successfully tested SBC Midwest’s billing systems in the fall of 2002, after both the conversion process was complete and SBC Midwest’s process improvements were implemented.
15. Because of the problems that SBC Midwest had during and after the CABS conversion, SBC Midwest initially did not pass BearingPoint’s test for the timely posting of new UNE-P service order activity to CABS in the four Midwest states conducted in early 2002. SBC Midwest worked diligently throughout the spring and summer of 2002 to eliminate the mechanical posting problems with Robotask and manual posting problems in the LSC.[14] Then, on August 1, 2002, BearingPoint published Exception 127, version 2 stating that retesting would occur in Illinois, Indiana, and Wisconsin (App. M, Tab 85). In performing this retest of TVV 9-32, BearingPoint utilized 35 UNE-P test case scenarios in each state.[15] BearingPoint submitted orders during the months of August and September 2002, and reviewed the bills for August, September, and October 2002 to determine whether the service order activity appeared by the second available bill. The results were outstanding. BearingPoint determined that the “Billing Test CLEC’s” UNE-P service order activity was timely posted to the bills 97.1% of the time in Illinois and 100% of the time in both Indiana and Wisconsin.
16. BearingPoint’s findings are persuasive for several reasons. First, they demonstrate that, at a minimum, by August 2002, new service order activity submitted by CLECs would properly post to CABS. Had this not been the case, orders submitted by BearingPoint would not have posted correctly. Second, BearingPoint’s findings clearly show that enhancements put in place by SBC Midwest to address issues stemming from the conversion were successful. What is critical is that BearingPoint tested SBC Midwest’s billing systems not only after the conversion, but also after SBC Midwest had implemented its corrective actions through the summer of 2002. Thus, the BearingPoint test establishes that prior to the reconciliation, CABS was generating UNE-P bills that reflected both accurate and timely information posted to the CABS system. Although SBC Midwest thoroughly validated the reconciliation results, it is not necessary that BearingPoint conduct testing post-reconciliation. BearingPoint tested the billing systems (i.e., the programming and processes) and found them to be accurate and timely. In contrast, the reconciliation addressed the synchronization of the CABS and ACIS data records (i.e., inputs to the programs and processes). The combination of BearingPoint’s successful testing with SBC Midwest’s reconciliation efforts ensures that bills provided to CLECs are timely, accurate, and auditable.
17. Sensing these excellent results however, CLECs criticize these findings, because they occurred prior to the reconciliation.[16] In response to that criticism, SBC Midwest engaged E&Y to perform testing post-reconciliation. Yet once again, as the independent third-party testing shows that SBC Midwest’s billing systems are accurate, which is not the result that the CLECs desire for 271 purposes, the CLECs criticize this testing as well.
ERNST & YOUNG (“E&Y”)
18. It is indisputable that E&Y performed comprehensive testing, which further contradicts the CLECs’ claims that billing issues are unresolved. First, in a comparison of database accuracy, E&Y found in excess of 99% accuracy between CABS and ACIS, after more than 1.7 million service orders were processed by SBC Midwest between the time of the ACIS/CABS reconciliation (January 2003) and the E&Y comparison conducted using April 23, 2003 ACIS data.[17] Forty-six (46) percent of those circuits sampled experienced service order activity since the reconciliation. E&Y’s findings therefore, confirm that post-reconciliation service order activity is posting to the billing system appropriately.[18]
19. Second, E&Y performed a comprehensive review of SBC Midwest’s rate accuracy by reviewing recurring, non-recurring, and usage charges. In order to ensure that the E&Y review reflected the accuracy of actual customer billing experiences, the E&Y sample was selected from actual UNE and UNE-P accounts and testing was performed from end-to-end. The E&Y review traced rates from the CLEC interconnection agreement, to the billing system rate tables, through to the actual bills rendered. In addition, E&Y’s sample reflects the USOCs that CLECs predominantly order and SBC Midwest bills.[19] For the monthly recurring charges E&Y found a 1.56% error rate, for non-recurring a 1.31% error rate, and for usage a 3.16% error rate.[20]
RECONCILIATION ISSUES
20. If the CLEC allegations are viewed in context, it is clear that they do not substantiate that SBC Midwest’s billing functionality is discriminatory. In their comments, the CLECs are conducting much of the day-to-day billing claims through the regulatory process rather than on a business-to-business basis.[21] AT&T and MCI continue to criticize SBC Midwest’s enormous efforts concerning the reconciliation. They generally allege that their internal records show that the reconciliation was not successful, that SBC Midwest applied credits and debits inappropriately, and that E&Y’s additional testing did not address the billing problems.[22]
21. AT&T asserts that SBC Midwest has defaulted on its obligation to identify, explain and repair the root causes of the changes required by the reconciliation effort. AT&T is wrong. First, SBC Midwest has provided substantial information regarding the root cause of the need for the reconciliation, in addition to efforts to address the underlying synchronization issues. SBC Midwest has provided substantial evidence through an independent third-party validation that the reconciliation was indeed successful, and that the databases remain well-synchronized months following the reconciliation effort. Moreover, SBC Midwest has met directly with some CLECs, including AT&T, to review the reconciliation process, and answer any of its questions.
22. As AT&T indicates, it did provide SBC Midwest with a list of 285 telephone number examples that allegedly were not handled correctly in the reconciliation. SBC Midwest investigated all 285 examples and returned the results in a spreadsheet to AT&T. On a July 1 conference call SBC Midwest reviewed the results of its analysis and covered 15 of the examples on the first day. On July 2 an additional call was held with AT&T and the remainder of the telephone numbers from tab one were covered in detail as well as samples picked by AT&T from each of the remaining four tabs in the spreadsheet. Of the 285 examples, only one error was found and was related to manual handling. At the conclusion of the second call, AT&T stated it need to further investigate SBC Midwest’s findings and that this would take much time and resource on its part. To date, AT&T has not made further contact with SBC Midwest to resume further discussion on any additional issues with the results of the analysis for the 285 examples. For the one example that was found to be a manual intervention issue, SBC Midwest immediately corrected and issued appropriate credits. Again, SBC Midwest stands ready to resume discussions at AT&T’s request.
23. AT&T continues to attack the methodology used in the January reconciliation, despite the fact that the process, resulting debits and credits and the current database synchronicity were all thoroughly validated by an independent third-party. As part of the reconciliation process, files containing UNE-P service start and end dates along with the owning CLEC were created as far back as formatted mechanical UNE-P billing data was available. When UNE-P circuits were added or removed these files were used as reference to determine the correct dates used in creating the credit and debit Other Charges and Credits (“OC&Cs”). When dates could not be located on these files, the reconciliation defaulted to logic that would produce over crediting OC&Cs or no debiting at all.[23] In all situations where default OC&C generating logic was used, it benefited the CLECs. However, AT&T continues to question the percent of default dates used in calculating the debits and credits associated with the reconciliation, rather than simply working interactively with SBC Midwest on identifying OC&Cs that it believes were either over-billed or under-credited. SBC Midwest has provided AT&T with extensive information and discussion regarding the reconciliation process, including descriptions and examples of how each credit and debit transaction was conducted. SBC Midwest is willing to continue to work with AT&T on a business-to-business basis to resolve any remaining substantive reconciliation issues that it feels are unresolved.
24. AT&T also indicates that SBC Midwest is attempting to bill AT&T $3.3 million related to the reconciliation. However, SBC Midwest is not aware of a $3.3 million debit AT&T claims is associated with the reconciliation. Moreover, some of the debits and credits resulted from circuits that, although they may have been billed correctly prior to the reconciliation, were simply deleted and added back to position them correctly in the account.[24] Each of these circuits generated both a credit and debit associated with these repositioned circuits. The net impact of the reconciliation effort for AT&T across all 5 states in the SBC Midwest region was approximately a *** *** debit. This net debit equates to approximately *** *** of AT&T’s total UNE-P billing for 2002. For Illinois, Indiana, Ohio and Wisconsin, the total UNE-P circuits impacted for all CLECs in the 4-states was approximately 69,000 circuits added and 56,000 circuits deleted out of approximately 1.3 million UNE-P circuits in service. It is unfortunate that AT&T continues to criticize SBC Midwest’s efforts even though the reconciliation was executed many months ago and was thoroughly audited by E&Y.
25. Further, AT&T points out that SBC Midwest made no attempt to address discrepancies and inaccuracies in SBC Midwest’s usage reports.[25] SBC Midwest engaged E&Y to thoroughly review and report on the accuracy of the January 2003 reconciliation and several other billing-related issues, as outlined above. It was not necessary for E&Y to examine the DUF processes related to the reconciliation effort, particularly since E&Y validated that the usage process was independent of the posting of individual UNE-P orders in CABS.[26] Moreover, the DUF process was tested extensively by BearingPoint as a component of the OSS test, which was conducted with substantial participation from the CLECs and state commissions. AT&T appears to be making these allegations related to discrepancies in their usage reports based on the list of 1,941 circuits that they provided in the Michigan 271 proceeding. Specifically, AT&T stated that SBC Midwest was providing usage for circuits that were not AT&T’s customers. In most of these examples provided by AT&T, SBC Midwest was able to locate the PONs sent by AT&T and determined that the preponderance of these discrepancies were within AT&T’s own systems. See infra ¶¶ 36-47 for the details of SBC Midwest’s analysis of the 1,941 circuits.
26. MCI has also questioned SBC Midwest’s calculation of debits and credits related to the reconciliation.[27] As indicated above, SBC Midwest believes that it has applied credits and debits appropriately, which was supported by the E&Y audit findings. MCI can submit claims for any circuits for which it feels that it was inaccurately debited or credited as a result of the reconciliation, and SBC is willing to discuss the reconciliation impacts further with MCI. In fact, SBC Midwest met with MCI on June 24, 2003, with a subject matter expert providing a reconciliation presentation to MCI, as well as addressing additional questions from them.
27. During the June 24th call with MCI, MCI pointed out that the number of credits received out of the reconciliation, based on “from” dates, did not diminish over the course of 2002. Based on this information, MCI apparently believes that the process improvements put in place by SBC Midwest have had no impact. SBC Midwest examined the reconciliation OC&Cs for MCI whose “from” date appeared in December 2002. The vast majority of OC&Cs generated during this timeframe stemmed from two circumstances. First, the ACIS extract problem, where a program problem prevented ACIS from sending all of the UNE-P accounts to the reconciliation, resulted in the reconciliation inadvertently removing valid UNE-P circuits from CABS.[28] The removal of these UNE-P circuits generated credit OC&Cs, which were thoroughly audited by E&Y. Secondly, there are occasions when duplicate end office entries are established on the CABS database. This can cause some circuits for the end office to appear in one place, and other circuits to appear in another location for the same end office. The reconciliation moved all circuits under one end office assignment, which generated a circuit “add” and “delete” transaction, in addition to generating offsetting debits and credits. Generally, these circuits would have been billing correctly prior to and following the reconciliation process. These two situations had nothing to do with correcting billable UNE-P billing information from UNE-P order activity applied in December 2002.
28. MCI alleges that SBC Midwest did not properly credit CLECs for circuits that were no longer being billed at the time of the reconciliation.[29] Generally, a circuit that was no longer in service at reconciliation, presuming that it was in service at one point in time, would have been disconnected through the normal service order process. When a disconnect order is processed, the Effective Billing Date on the order would ensure that the appropriate fractional charges are calculated and displayed on the CLEC’s bill. Although SBC Midwest is unaware of any such instances, if MCI has specific examples that it believes needs investigation, SBC Midwest is willing to look into these claims.
29. MCI alleges that SBC Midwest should also have provided credits for NRCs and usage as part of the reconciliation.[30] MCI asserts that if SBC Midwest was charging MCI for circuits that did not belong to MCI, a nonrecurring charge was erroneously applied. The reconciliation, however, was focused on providing MRC credits on circuits for which a disconnect order may not have processed due to the out-of-sync condition caused by the UNE-P conversion effort. SBC Midwest is unaware of any circumstances related to the conversion or subsequent clean up efforts that would have caused erroneous NRCs or usage charges to be generated. Conversely, in circumstances where SBC Midwest has identified that circuits were not being billed, the reconciliation did not seek to recover any NRCs for circuits that were added. If MCI has any particular situations in which they believe that they were erroneously charged NRCs, SBC Midwest is willing to work with MCI on a business-to-business basis to resolve such claims.
30. Ms. Lichtenberg claims that, “In a June 3 meeting between SBC and MCI, SBC explained that the incorrect usage charges stem primarily from network manual errors by LSC representatives.”[31] It is somewhat difficult to determine what Ms. Lichtenberg means by “network manual errors” attributed to LSC representatives given the LSC Service Representatives do not perform any traditional network functions.[32] Service Representatives are human and may inadvertently process an order with charges that should not apply in a given situation. To the extent that manual errors occur during the LSC’s manual order writing process, the LSC Billing team is in place to collaboratively work through CLEC billing issues with MCI and all CLECs to resolve billing issues. While human error can never be completely eliminated, SBC Midwest has resources (LSC) and processes (billing and dispute processes) in place that provide the CLECs with the ability to effectively compete in the marketplace.
31. MCI also contends that since SBC Midwest doesn’t keep track of installation dates, that it would be very difficult to resolve future billing disputes.[33] As explained to MCI, if SBC Midwest was unable to identify the service start and stop dates mechanically based on the usage guide information, SBC Midwest would then use a surrogate date that resulted in over credits and under debits to the CLECs. However, for the purpose of resolving billing disputes and billing claims, LSC personnel have access to various systems such as ACIS and CABS, which can be used to determine service and or bill dates depending on the nature of the dispute.
32. AT&T claims that SBC Midwest has failed to fully rectify its problems or provide proof that changes to the billing systems have been successfully made.[34] First, as shown above, BearingPoint’s OSS test in August through October of 2002 concluded that the ongoing UNE-P order processing and associated billing was indeed working timely for those circuits established following the conversion and associated clean up effort. The BearingPoint testing has now been supplemented by E&Y to validate that the reconciliation was executed as designed, which synchronized the databases for those circuits that may have carried residual issues from the conversion.
33. Second, as stated previously, SBC Midwest has made many system changes related to the processing of UNE-P orders since the conversion, including improvements to Robotask processing and LSC work management tools.[35]
34. Some of these improvements include:
• Development of a “follow-up” capability that allows the last person working an item to include notes and follow-up instructions for future users who might encounter this same item. To the extent that “re-work” scenarios remained, this capability added efficiencies for subsequent work, allowing those service representatives to benefit from information regarding the previous service representative’s activity;
• Addition of “Notes Tool” functionality, which allows the system to mechanically relate the CABS order to the ACIS order as the CABS order is being manually worked. This functionality also permits the removal of orders from the LSC work list once the order has been processed and updates the CABS database; and
• Development of referral codes for categorizing service orders, allowing for the development of specialized skill sets within groups of service representatives. For instance, service orders falling into the “Complex” referral code are quickly referred to a specialized team for handling, allowing other service representatives to focus on working more typical orders.
• Robotask logic was enhanced to mechanically process UNE-P coin requests. Prior to this change, service orders for UNE-P coin service were written manually by the service center. This change improved flow thru of mechanical processing.
• Robotask logic was enhanced to filter Record (“R”) orders that did not require a CABS order. Examples of this type of order would be a correction to the service address. Since service address is not maintained in CABS, no order is needed. This improved flow through by eliminating ASON orders that did not require CABS orders.
35. Third, E&Y’s testing related to the accuracy of the ACIS and CABS databases and its rate accuracy validation, provide independent evidence that the UNE-P billing process is indeed very accurate and timely.
LINES IN SERVICE BILLING AND USAGE ALLEGATIONS
36. AT&T’s comments regarding the “abundant new evidence” that SBC Midwest’s systems remain unstable and unreliable apparently are related to AT&T’s submission of 1,941 Michigan UNE-P circuits that SBC Midwest was allegedly incorrectly billing AT&T. This “new evidence” also appears to be related to numerous claims throughout AT&T’s comments that SBC Midwest is erroneously sending DUF records to AT&T, even for circuits that have never been in AT&T’s ordering systems. Prior to this filing, SBC Midwest thoroughly investigated each one of the circuits provided by AT&T, and provided a response to AT&T that pointed out that approximately 75% of the AT&T claims were actually problems within AT&T’s own systems. In fact, for circuits that AT&T claimed were never in their ordering system, SBC Midwest was able to identify most of the purchase order numbers supplied by AT&T. Knowing these facts, AT&T still discussed this “new evidence” in their replies with the full knowledge that the data was not accurate. Consequently, AT&T’s “abundant new evidence,” which is the underpinning of nearly all of their arguments related to alleged deficiencies in SBC Midwest billing system and DUF issues, is not reliable.
37. Both AT&T and MCI continue to utilize the regulatory environment to raise issues about billing without providing the opportunity to work collaboratively on a business-to-business basis and providing statistics that grossly misrepresent the facts. In fact, if AT&T and MCI would work with SBC Midwest to review their assertions, the carriers would not be casting AT&T and MCI internal errors as being attributed to SBC Midwest. Following are the details associated with the additional review of 345 of the original 1,941 Michigan telephone numbers requested by AT&T and 6,090 telephone numbers provided to SBC Midwest by MCI concurrent with its 271 reply comments for this 4-state application.[36]
AT&T ANALYSIS
38. AT&T’s actions regarding the analysis of 1,941 UNE-P telephone numbers (or roughly *** *** of their total *** *** UNE-P lines in service in Michigan in March of 2003) that it alleged SBC Midwest to not be billing correctly clearly demonstrate that AT&T is not interested in working with SBC on a business-to-business basis to address AT&T’s concerns and/or to jointly perform analysis. AT&T never attempted to work jointly with SBC Midwest regarding SBC’s March or May billings for these telephone numbers prior to filing the telephone numbers with the FCC via a Protective Order in Docket No. 03-138, which AT&T filed on July 2, 2003.
39. SBC’s analysis provided to AT&T on July 25 reflected that 1,465 of the telephone numbers, or approximately 75% are attributable to AT&T record keeping errors. Examples of these types of errors are included in the letter provided to AT&T on July 25, which is attached as Attachment A. While the analysis of the remaining telephone numbers did indicate that SBC Midwest may have contributed to the record keeping errors, those errors were caused by manual processing. The totality of occurrences where SBC Midwest may have contributed to record keeping errors represent a mere
*** *** of the number of lines in service for AT&T in Michigan, based on March 2003 data. Moreover, SBC Midwest has implemented several improvements in its procedures and processes to reduce errors caused by manual handling. See infra ¶¶ 81-89.
40. AT&T criticizes the fact that SBC Midwest provided the detailed results of the analysis completed by SBC Midwest for the 1,941 telephone numbers. AT&T states that the “voluminous information in SBC’s response was provided in the form of several spreadsheets, and AT&T’s review has been hampered by SBC’s failure to provide any summary.”[37] Contrary to this criticism, AT&T acknowledges that the spreadsheets that SBC Midwest provided to AT&T correspond to the AT&T exhibits filed with the FCC.[38] In fact, the conversation referenced by Sarah DeYoung that took place on July 31[39] is misrepresented by Ms. DeYoung. This discussion did not reference compliance with the protective order, but rather Becky Krost explained to Ms. DeYoung that SBC Midwest had summarized its findings, and then resorted the information into the same format that AT&T had provided it for AT&T to easily reference.
41. Between July 2 and July 25, 2003, SBC Midwest dedicated significant operational resources to analyze the telephone numbers. These team(s) worked in excess of three thousand hours performing the analysis ultimately provided to AT&T. Through its July 25th response, it was SBC Midwest’s objective to provide AT&T with details for each telephone number in the same format as that provided to the FCC by AT&T in the Michigan application.[40]
42. Within SBC Midwest’s July 25 letter and also during discussions with Sarah DeYoung on July 30, July 31 and August 6, Becky Krost offered to bring together the appropriate subject matter experts to review the details of the SBC Midwest analysis with AT&T. As expressed in SBC Midwest’s July 25 letter, SBC Midwest firmly believes that joint analysis is the most effective way to manage and bring issues or questions about billing and usage to closure. As opposed to working with SBC Midwest upon receipt of the analysis, AT&T continued to work independently and, the day prior to filing comments in this proceeding, AT&T elected to refer back to SBC Midwest 340 telephone numbers for additional review, claiming that “there is the existence of unaddressed errors in SBC Midwest’s billing systems”.[41] SBC Midwest took seriously the filing that AT&T made with the 1,941 telephone numbers on July 2 and dedicated its resources to analyzing and addressing each and every one of the telephone numbers. The fact that AT&T asked SBC Midwest to perform additional analysis should not be confused with and interpreted to mean that SBC Midwest left items “unaddressed.” AT&T should be focused on partnering with SBC Midwest to bring these issues to closure rather than regulatory posturing.
43. AT&T’s August 25, 2003 Ex Parte letter, filed in the Michigan proceeding, further clarifies AT&T’s objective with respect to regulatory posturing as opposed to using the data provided by SBC Midwest on July 25 and August 20 to engage in collaborative analysis to ensure that AT&T’s and SBC Midwest’s databases are in synch. Moreover, in the AT&T ex parte, AT&T discusses two sets of analysis, e.g., the 285 reconciliation circuits for which SBC Midwest previously provided responses and the 1,941 telephone number analysis. In addition, AT&T raised an issue with one telephone number, which was disconnected during the time that SBC Midwest was analyzing the circuits. For this telephone number, SBC Midwest sent to AT&T an abandoned service notice on August 14. As described in SBC Midwest’s August 20 letter to AT&T, there were a series of steps to the analysis. With AT&T’s complaint being that it was not receiving DUF for telephone numbers, SBC Midwest first went to re-validate that the network assignments were established. For this telephone number, the network assignment was established at the point in time that it was validated. It is clear that between the time when the network assignments were validated and the time that all of the analysis steps were completed on August 20, the telephone number was disconnected consistent with the notice sent to AT&T on August 14. Apparently, AT&T did not review its own records and AT&T did not discuss with SBC Midwest the analysis provided by SBC since receiving it on August 20, but instead filed its ex parte in Michigan.
44. With respect to the further analysis requested by AT&T on August 5th for the 340 telephone numbers, AT&T claims that it is not receiving usage and that SBC Midwest has not demonstrated that the 340 telephone numbers belong to AT&T customers. Therefore, AT&T concludes that it should not be receiving bills for these customers.[42] The analysis SBC Midwest provided to AT&T however, belies AT&T’s conclusions. For instance, in its July 25 analysis, SBC Midwest provided AT&T with the Purchase Order Numbers for telephone numbers established by AT&T and also provided AT&T with disconnect dates and line loss notification dates to the extent such transactions took place for each telephone number. Likewise, SBC Midwest provided AT&T with a number of scenarios that might cause an end-user to have a telephone line and for a period of time not place or receive calls. For example, vacation homes may only be in use for limited months of the year, and second lines established by customers may have infrequent or no use. Unfortunately, instead of working collaboratively with SBC Midwest to investigate these or other possible scenarios, AT&T simply dumped these circuits back into the 271 proceeding.
45. SBC Midwest has performed additional analysis on these 340 telephone numbers as requested by AT&T as well as 5 more telephone numbers requested by AT&T on August 12 and 15. Through its additional review, SBC Midwest identified 2 telephone numbers out of the base of 345 that were, in fact, instances in which SBC Midwest made errors when manually processing disconnect orders. These manual errors were such that while manually processing disconnect orders a service representative disconnected the physical line within the network, but did not do the same in Billing. With the two examples of SBC Midwest errors not previously identified as such when SBC Midwest provided its analysis to AT&T on July 25, SBC Midwest sampled the remaining population of the 1,941 telephone numbers for telephone numbers that could contain similar circumstances. SBC Midwest’s scan of the remaining 1,941 telephone numbers resulted in 14 additional manual disconnect processing errors. SBC Midwest has reviewed these 14 and the 2 errors mentioned above and has confirmed that all 16 of these manual errors occurred during 2001 and 2002. As SBC Midwest communicated in its August 20 response to AT&T, SBC Midwest is and will continue to assess its manual processing procedures to determine if other preventative safeguards are needed.
46. AT&T has been critical of the time that it took for SBC Midwest to complete its additional analysis (August 5 through August 20) despite the fact that SBC Midwest has reviewed many complex processes and retrieved archived data. The additional analysis steps and information provided to AT&T on August 20 are outlined in the August 20 letter to AT&T (Attachment B). These steps were critical to the analysis. For example:
▪ AT&T specifically claimed that it was not receiving usage for the 340 telephone numbers for which it requested additional research and therefore concluded that it should not be billed for the telephone numbers.[43] SBC Midwest accessed DUF files for a five-day period of time in April 2003, (April was chosen based on the fact that AT&T’s analysis centered around the March and May 2003 bills). Through this analysis, SBC Midwest identified that it did in fact, send usage to AT&T for 13 telephone numbers, contrary to AT&T’s allegations. As a result of this analysis, SBC Midwest believes that if calls were or are placed from or received by the telephone numbers it reviewed, usage was and will be provided to AT&T.
▪ SBC Midwest also shared with AT&T on August 20 that for roughly 96, or 28%, of the 340 telephone numbers, SBC Midwest identified disconnect transactions it received from AT&T that SBC Midwest rejected back to AT&T because the telephone numbers were not valid. As SBC Midwest pointed out to AT&T, it appears that in instances where AT&T did not update its database to capture the actual telephone number given when the one requested by AT&T was not available if it chose to disconnect the “given” telephone number it may have used the incorrect one.
▪ Through its analysis, SBC identified 2 instances where service orders posted late. In both examples, when the service posted, the bills were electronically corrected with credits applied to the actual service disconnect date. These 2 instances do not represent a systemic problem and again it is clear that AT&T did not capture the accurate details about these telephone numbers when it apparently reviewed the telephone numbers against May billing. If AT&T had reviewed the details of billing for these telephone numbers, it would not have sent these to SBC to review in July and again in August.
47. The results outlined above further substantiate the analysis provided to AT&T on July 25 and clearly reinforces the fact that AT&T is looking to create confusion and raise non-factual information on the record. The 16 additional SBC Midwest-caused errors do not materially change SBC Midwest’s overall analysis, that is, those errors continue to represent only a *** *** error rate.
48. SBC Midwest remains committed to working with AT&T on a business-to-business basis and is hopeful that the results of this further analysis will convince AT&T to do the same.
MCI ANALYSIS
49. SBC Midwest was surprised and disappointed that MCI had deviated from an established process that SBC Midwest had implemented with MCI more than 12 months ago to utilize the Lines in Service (“LIS”) reports to identify questions or issues for the 2 companies to jointly review by first announcing that it had referred 5,612 errors to SBC Midwest in its 271 filing in this proceeding.[44] In fact, what MCI sent to SBC Midwest are 4 lists of telephone numbers for a total of 6,090 telephone numbers, 6,088 of which are associated with the Midwest Region, to be researched by SBC. MCI states that there are “serious discrepancies in SBC Midwest’s internal databases.” MCI Comments at 7. Even if the worst situation existed and all 6,088 Midwest telephone numbers were SBC Midwest errors, MCI fails to put into perspective the fact that this would equate to a ***
*** error rate. However, just as the AT&T analysis revealed, the actual error rate that may be attributed to SBC Midwest is much lower, approximately *** ***.
50. The process previously established between MCI and SBC Midwest was not adhered to and as a result, MCI did not provide SBC Midwest with all of the pertinent information necessary to complete analysis on all of the telephone numbers. MCI did not provide SBC Midwest with the main billing number for the telephone numbers and when asked to do so only resubmitted the end user working telephone numbers. SBC Midwest’s analysis, which it expects to provide to MCI no later than August 29, 2003, reflected that of the 6,090, 4,192 of the telephone numbers or approximately 69%, have no apparent SBC Midwest-caused error and appear to be MCI record keeping errors, while 466 of the telephone numbers cannot be analyzed as a result of the need for additional information from MCI.
51. For instance, 62 telephone numbers (“TNs”) were included on MCI’s spreadsheet twice with conflicting information. More specifically, MCI lists these telephone numbers as not being billed and receiving traffic (SBC Midwest defines this as DUF usage) and also lists them again as not receiving traffic. With these appearing twice, there are 124 telephone numbers within the spreadsheet that SBC Midwest does not know what MCI wants SBC Midwest to investigate. The remaining telephone numbers in this category are aged to the point prior to LSOG 4 and will require collaborative analysis. The remaining 1,432 telephone numbers did indicate that SBC Midwest may have contributed to MCI’s record keeping errors. The analysis reveals that the errors caused by SBC Midwest are attributed to manual processing errors, only 53 of which were errors created in 2003. These errors represent an error rate of *** *** when compared to the number of lines in service for MCI at the end of April 2003.
52. MCI also states that it converted “all of its resale customers to UNE-P.”[45] Of the 6,090 TNs MCI provided to SBC Midwest for analysis, *** *** were previously identified as Resale lines to MCI on their July 2002 Lines in Service file. SBC Midwest continues to provide MCI with a detailed LIS report identifying MCI Resale lines every month and these have not been raised to SBC Midwest by MCI as issues. Even more disturbing, SBC Midwest has identified Resale Change Order Activity sent by MCI to SBC Midwest in June 2003. While investigating these Resale lines, SBC Midwest also identified
*** *** Resale lines that belong to MCI as the end user for the lines. SBC Midwest will work with MCI to determine how it is using these lines to determine whether or not MCI should have these as Resale or if it should have ordered these via Retail for its internal use.
53. With the transmission of its analysis to MCI for these telephone numbers, SBC Midwest is hopeful that MCI will embrace the business-to-business process to work with SBC regarding any future questions or issues it has.
LINE LOSS ISSUES AND SERVICE ORDER ACCURACY
54. In its Michigan Declaration, MCI implied that it only recently became aware of potential billing and line loss notification problems with the 487 lines it provided to its Account Team for investigation on April 14, 2003. In fact, MCI’s complaint that it is being billed inappropriately for these circuits amounts to nothing more than a rehash of LLN issues that are more than a year old, and were dealt with and resolved in connection with various state proceedings. MCI’s argument that the billing on these circuits somehow indicates a “real ongoing problem” with the accuracy of the ACIS database and/or with the effectiveness of the ACIS/CABS reconciliation is unfounded. Lichtenberg Mich. Decl. ¶ 22.
55. Specifically, in response to the MPSC’s order dated December 20, 2001, SBC Midwest undertook to work directly with the CLECs to resolve numerous LLN issues that could potentially have resulted in the CLECs continuing to bill after service had been migrated to a new provider (which could happen if an LLN for the line in question was not provided on a timely basis), or failing to appropriately bill an end user (as could happen if an LLN was incorrectly provided on an account which the CLEC had not lost.). SBC Midwest expended significant resources and effort throughout 2002 to address CLEC issues and concerns related to LLNs and to implement system fixes and enhancements to correct identified problems.
56. Most importantly, in response to CLEC concerns regarding the accuracy of their databases as compared to SBC Midwest’s databases following the various LLN fixes and enhancements, SBC Midwest developed a “lines in service” (LIS) report that was made available to requesting CLECs pursuant to Accessible Letter CLECAM02-256 (June 17, 2002) (App. I, Tab 30). The LIS report provides a “snapshot” of a CLEC’s active lines in the ACIS database as of a given date, including (among other things) a list of Working Telephone Numbers (“WTNs”) attributed to the CLEC’s codes as of that moment in time. Using this report, CLECs may identify discrepancies between their records and SBC Midwest’s records for reconciliation. SBC Midwest recommended the ACIS database as the best tool for conducting such reconciliation – a recommendation confirmed by the low rate of error found in the database scans referenced herein.
57. To ensure the best possible accuracy of the LIS report, prior to making the reports available SBC Midwest ran scans of the ACIS database to correct error conditions that could result in billing error. For example, one such scan corrected mismatches between FIDs for the business unit indicator (“ZBU”) for the CLEC and the CLEC code (ZULS for UNE-P, followed by a CLEC identifying indicator) on the ACIS record. Such a mismatch could drive usage to the wrong CLEC. As described in detail in the reports filed with the MPSC, CLECs were actively involved in the preparation for these scans, which were completed on May 10, 2002. Out of almost 2,000,000 records scanned, “mismatch” errors were found on less than 1,000, for an error rate of less than 0.05%. In order to prevent any future occurrences, a system edit to check these FIDs for mismatches prior to processing was implemented on April 16, 2002. [46]
58. To account for possible situations in which the Business Unit indicator and CLEC code FIDs matched on the ACIS record, but the billed name field reflected a different CLEC (which can be caused by service rep error and can result in a UNE-P circuit being billed to the wrong CLEC), an additional validation scan was performed on June 6, 2002, which captured approximately 350 total errors in the SBC Midwest region.[47]
59. MCI has received a copy of the LIS on a monthly basis since it was introduced. In September 2002, MCI contacted the LSC (per the directions contained in the Accessible Letter) and requested that SBC investigate approximately *** *** WTNs out of the more than *** *** WTNs that appeared on its August 2002 LIS report (which reflected lines in service as of July). As reflected in SBC Ameritech Michigan’s Response to WorldCom’s Update on the Line Loss Notification Issue, filed with the MPSC on October 24, 2002,[48] the total discrepancies identified by MCI for investigation amounted to approximately 2% of its lines in service. Of those, SBC Midwest has determined that more than *** *** resulted from record keeping errors on MCI’s part, and could not be attributed to any failure on the part of SBC Midwest to provide accurate line loss notifications. Thus, less than 0.47% of the WTNs contained in the August 2002 LIS were associated with any potential error on SBC Midwest’s part.
60. MCI submitted a spread sheet in April 2003 with 487 WTNs as part of the Michigan 271 filing. On review of MCI’s April 2003 spreadsheet, SBC Midwest determined that LLNs were in fact sent in error on approximately 360 of the 487 listed WTNs, with MCI record keeping error accounting for more than 100 of the WTNs. Only three of the erroneous LLNs were sent in 2003 however, with the majority being sent prior to July 31, 2002. As noted earlier, MCI receives its LIS report on a monthly basis, providing it with the ability to request reconciliation of any discrepancies between the report and its own database records. Notably, SBC Midwest’s ACIS database correctly reflects the WTNs for which MCI received erroneous LLNs as active MCI accounts; the inaccuracies here are in MCI’s database, which, using the LIS report, MCI has had more than sufficient opportunity to correct.[49]
61. In addition, MCI also asked SBC Midwest, on August 6, 2003, about another 36 lines on which it received line loss notifications from SBC, but which were still included in SBC Midwest’s lines-in-service report.[50] It is important to note that these 36 TNs, or
*** *** of MCI’s lines in service in May 2003, compare to *** *** lines which MCI questioned in September 2002 and 487 it questioned in April 2003 (for which all but three have been shown to be prior to 2003). Thus, it appears that SBC Midwest’s LLN improvements have been successful. SBC Midwest’s review of these 36 lines concluded:
• There were 6 TNs where a line loss was generated to MCI in error. The line loss was sent in error, however, the ACIS database is correct. Thus, MCI’s LIS file was correct. While SBC strives to eliminate all of these types of errors, this is precisely the reason for making the LIS report available to the CLECs: To enable them to perform audits to identify the minimal number of errors that make it through the ordering process undetected.
a. 2 of these were involved with scenarios that have since been corrected
b. 1 of these would have been identified by the SOQAR Safety Net[51] which was implemented on May 1, 2003 to prevent these types of errors.
c. 3 of these involve scenarios for which SBC is currently developing a Safety Net report. This safety net will identify situations in which there is a D order related to two N orders. In some instances these situations cause line loss errors, so all such cases will be reviewed. SBC is targeting the rollout of this report in the September to November timeframe.
• On 28 TNs, manual processing issues resulted in a line loss being appropriately generated to MCI but the billing system not being updated to reflect the loss. Thus, the LIS file sent to MCI contained incorrect information on these 28 lines. All of these 28 errors occurred prior to the May 1, 2003 SOQAR Safety Net report, which was implemented to prevent these types of errors.
• There was 1 TN where a manual processing issue similar to that described for the 28 TNs described above occurred. In this instance, a LLN was sent correctly but the service representative erroneously re-established the TN with MCI as opposed to the assuming carrier. As was the case with the 28 TNs, the age of this issue is such that it occurred prior to May 2003 and the SOQAR Safety Net report was not yet implemented.
• There was one TN where SBC identified MCI to have a record keeping error.
62. SBC Midwest continues to work with MCI on a daily basis to resolve these issues. The reduction in the items to be reviewed between September 2002 and August 2003 demonstrates the tremendous amount of improvement that has been implemented in working these types of issues on a business-to-business basis.
63. The efforts of SBC Midwest and the CLECs to address LLN issues during the course of 2002, the ACIS database scans discussed above, and the use of the LIS report by CLECs to correct their own databases and to call potential errors to SBC Midwest’s attention, only serve to enhance the accuracy of ACIS and the efficacy of the ACIS/CABS reconciliation.
64. MCI also claims that SBC Midwest fails to properly track unbundled elements of MCI’s lines so that the number of loops, ports, and cross-connects associated with those consistently differ.[52] MCI provided SBC Midwest no specific telephone numbers nor has it provided examples to the SBC Midwest account team, even though the account team requested specific examples after MCI raised this issue. Therefore, SBC Midwest conducted its own extensive analysis on all MCI circuits in the SBC Midwest region. Scans of the CABS database for all five states were developed and implemented looking for active UNE-P circuits with MRC irregularities of missing UNE-P billable equipment or duplicate UNE-P billable equipment. Out of MCI’s approximately *** *** lines in service for the five-state region, SBC Midwest’s investigation found approximately *** *** MCI UNE-P circuits with MRC irregularities or approximately *** ***. SBC Midwest’s analysis further revealed that for approximately 98% of the identified circuits, SBC Midwest was under-billing MCI (e.g., not billing MCI for a cross-connect). The approximate MRC value of under-billing for MCI is only *** ***.
65. SBC Midwest has recently developed reports that are utilized by the LSC to identify potential issues on a daily basis. SBC Midwest has also performed extensive root cause analysis and has determined that these errors are associated with manual service order errors. Moreover, SBC Midwest has enhanced edits, which will allow service representatives to identify and correct such issues prior to billing. SBC Midwest is in the process of issuing correcting service orders for the impacted UNE-P circuits. The LSC will work corrective actions for credits of over-billed circuits first. However, for the majority of circuits, where SBC Midwest would be entitled to a debit, SBC Midwest will not back-bill for those circuits, but will begin billing for the applicable USOCs prospectively. This is yet another example of how by working business-to-business, record keeping issues between companies can be identified and corrected proactively. Based on the investigation performed for MCI, SBC Midwest is proactively analyzing similar data for all CLECs. SBC Midwest will work with any impacted CLEC to issue correcting service orders and credits if applicable on a business-to-business basis.
66. AT&T suggests that SBC Midwest’s decision not to ask E&Y to examine the accuracy of the ACIS database is consistent with AT&T’s concern about the quality of ACIS.[53] Based on the evidence presented in this record, however, SBC Midwest does not believe any further proof of ACIS accuracy is required. Again as stated above, BearingPoint has analyzed the level of Customer Service Record (“CSR”) accuracy and found that the tests for Illinois and Ohio resulted in SBC Midwest only slightly missing BearingPoint’s benchmark of 95 percent, however SBC Midwest exceeded the BearingPoint Customer Service Inquiry (“CSI”) testing benchmark in Indiana (96.8 percent) and Wisconsin (96.2 percent). Additionally, SBC Midwest has committed to further testing of CSR accuracy through improvement plans overseen by BearingPoint and reported to the state commissions. While manually issued service orders are, in some instances, issued incorrectly, SBC Midwest is confident in the level of accuracy and the processes in place to correct the errors when they do occur. As stated in the Brown 4-State Affidavit, the LSC performs quality reviews on randomly selected orders and, in addition to correcting the errors found, provides feedback and coaching to representatives found to be making mistakes. In addition, should a mistake be made, the Billing Claims resolution process exists to investigate and correct errors. Moreover, the CLECs can, and have, utilized the LIS at any point to validate the accuracy of SBC Midwest’s ACIS account data.
67. Nor is there any indication that normal order processing activity has contributed to any degree of appreciable error in the ACIS database. Attachment D to the Brown/Cottrell/Flynn 4-State Affidavit is a service order flow diagram for UNE-P LSRs. As that diagram illustrates, electronically submitted UNE-P LSRs first go through an editing process in LASR. If LASR determines that the request is flow through eligible, the LSR is passed to the MOR/BRS system for the mechanized creation of electronic service orders. Those service orders then are sent electronically to ASON, which distributes the service orders to the provisioning system.
68. Using this process flow, mechanically submitted, flow-through eligible UNE-P LSRs are capable of being processed and distributed to the provisioning systems based on information provided by the CLEC on the LSR, with no manual intervention whatsoever. In fact, based on performance measurement data, the vast majority of UNE-P LSRs are processed in just this manner. Specifically, in the April – June 2003 timeframe, more than 96% of flow-through eligible UNE-P LSRs and 90% of total UNE-P LSRs processed by SBC Midwest (and reported in PMs 13 and 13.1, respectively) flowed through to provisioning without manual intervention.
69. Once provisioning is completed in ASON, the service orders post to the CSR, which is stored in the ACIS database. If there are error conditions in the provisioning systems that prevent the completion or posting of the service order to ACIS, those errors are cleared by LSC service representatives. However, because the LSC intervention in this instance is solely to clear an error condition in the electronic systems to ensure that the order completes and posts appropriately to ACIS, there is minimal chance that this intervention would, instead, be an occasion of error on the ACIS record.
70. Taken together, these facts demonstrate that a very high percentage of UNE-P LSRs process through SBC Midwest’s ordering and provisioning systems and post to ACIS on an entirely mechanized basis with negligible opportunity for error on the CSR.
71. As discussed in the Brown 4-State Affidavit, electronically submitted LSRs for service types that are not designed to flow through fall out for manual handling by the LSC. LSC service representatives manually create the service orders for those LSRs in the appropriate ordering system, which then distributes the service orders to provisioning.
72. In addition, SBC Midwest developed a Service Order Quality informational package for training LSC service representatives on the importance of accuracy and the impact of inaccurate orders on CLECs and end-users. The LSC also designed and implemented a Quality Review Process that provides for daily review of a sample of manually handled UNE-P and resale production service orders. Quality Assurance service representatives compare the internal service orders to the LSR submitted by the CLEC on a field-by-field basis. Any errors found are identified and corrected, and the root cause identified. This information is tracked and analyzed to determine whether any common issues or trends can be identified, as well as to develop and implement appropriate corrective action.
73. In an effort to further improve quality, new reports have been developed which will compare some critical fields on the service order to the corresponding fields on the LSR. If the values on the service order are not the expected values, the information for this mismatch appears on these reports. The reports, referred to as Service Order Quality Accuracy Reports (“SOQAR”), are available on the SBC Intranet and are accessed regularly by the LSC to make appropriate corrections to the accounts containing the errors. The three reports currently being used are the RUF/RRSO Report, ACNA/ZULS Mismatch Report and the Billing ZULS Mismatch Report. These reports identify the following issues for correction:
a. RUF/RRSO Report – RUF and RRSO are FIDs used to relate telephone numbers on migrations to ensure the reuse of facilities. If there is a problem with this relationship, the report identifies the discrepancy for review.
b. ANA/ZULS Mismatch Report – The ZULS FID is used to identify the CLEC responsible for a given account. Among other things, this FID is important for processes that send LLNs as well as ensuring that the account is billed to the appropriate carrier. This report identifies scenarios in which the ZULS does not match expected values.
c. Billing ZULS Mismatch Report – This report identifies orders on which some portion of the Billing Information on the order does not match expected values.
74. Taken together, these facts demonstrate that MCI’s and AT&T’s purported concerns, that there is an “ongoing problem” with either the ACIS database or with the ACIS/CABS reconciliation, are unfounded. ACIS was and is a sound database that accurately reflects UNE-P provisioning activity in the Midwest Region. SBC Midwest does not contend that ACIS records are perfect, however, based on the LIS findings in both 2002 and 2003, SBC’s ACIS records appear to be more accurate than MCI’s own records However, SBC Midwest has taken steps to ensure that the database is maintained in as accurate a manner as possible, that any opportunities for error are minimized, and that any actual errors are corrected as soon as reasonably possible after detection and that CLECs have a tool to review their data and request reconciliation. No CLEC has provided credible evidence to the contrary.
SBC MIDWEST’S BILLING DISPUTES IN CONTEXT
75. Unfortunately, it appears that evidence presented by SBC Midwest is being analyzed outside the context in which such evidence was presented.[54] First, SBC Midwest presented evidence reflecting that from January 2002 through April 2003, CLECs had disputed between 13.1% and 19.4% of their total billings.[55] Although SBC Midwest recognizes that this metric, standing alone, provides little insight into the efficacy of SBC Midwest’s billing systems in the 4 states, the evidence was not presented in isolation.[56] This evidence was presented in response to generic allegations that CLECs have experienced an inordinate number of billing errors in the 4 states, requiring them to spend an inordinate amount of time and money in auditing their 4 state bills and filing rate claims. As SBC Midwest demonstrated, however, SBC Midwest’s claim records belie that allegation. Instead, the evidence indicates that over the same period of time (selected in order to normalize peaks and valleys in claim activity) other states for which SBC has received Section 271 authorization have received a generally comparable level of claims.[57] Thus, as the heading under which this evidence was presented indicates, SBC was merely attempting to place “SBC Midwest’s Wholesale Billing Disputes in Context.”
76. AT&T claims that SBC Midwest has significant billing disputes with CLECs.[58] However, as reiterated above, the level of disputes is not vastly different from the level of billing disputes experienced in other SBC states, which have already received 271 approval. SBC Midwest does not intend for this analysis to be misconstrued as a statement that SBC Midwest is not concerned with the billing disputes received in the 4 states. This could not be further from the truth. SBC Midwest has, and is continuing to devote resources to investigating and resolving billing disputes in all states in all regions. It is, however, intended to put into context CLECs’ claims that they are experiencing an unusually high number of billing issues in the SBC Midwest region. The data simply does not support the CLECs’ assertions.
77. AT&T attempts to convince the Commission that SBC Midwest belittles the significance of billing disputes by stating the level of disputes is no different in the Midwest than other states granted 271 relief, and that disputes are “a commercial fact of life.” AT&T further indicates that SBC Midwest’s decision to devote resources to explaining away its billing problems rather than resolving them distinguishes the 4 state application from those with 271 approval.[59] SBC Midwest has devoted significant efforts to working with the CLEC community in answering questions, enhancing processes, even agreeing to a trial which could fundamentally change our processes for receiving rate related claims, all at the request of the CLECs. Moreover, SBC Midwest is entirely committed to continuing to work with the CLEC community to bring the level of disputes to the lowest possible level. However, as mistakes will be made from time to time, even by AT&T’s employees, billing disputes will continue to be a commercial fact of life.
78. AT&T states that SBC Midwest has not made clear whether its calculation of disputes rate includes only billing disputes that are subject to formal dispute resolution.[60] Similarly, TDS suggests that the Commission should require SBC Midwest to make the business rules used for the dispute rate calculation available.[61] SBC Midwest’s data is based on a “comparison of the total amount of wholesale billing claims recorded in the claims tracking system by SBC Midwest for Illinois, Indiana, Ohio and Wisconsin during the seventeen (17) month period from January 2002 through May 2003 to the total of wholesale billing during that same period in those same states.”[62] SBC Midwest also clarified that “[t]otal billings and claims for purposes of this calculation exclude collocation and miscellaneous billing as well as claims related to those charges, which are handled in the Collocation Service Center (“CSC”) and LEC Services Billing (“LSB”), respectively.”[63] SBC Midwest could not have been more clear in the methodology used to generate the data. These claims are entered into the official claims tracking system, called WebTAXI, by the LSC. It is this system which is used by the LSC as the source for claims-related statistics. If a CLEC fails to utilize this documented process, and instead opts for a more informal discussion related to billing, there is no way to include such discussions when calculating official claims statistics. SBC Midwest’s “total” does not “conveniently” ignore any disputes received via the appropriate process for receiving and resolving disputes as AT&T suggests.
79. TDS also suggests that SBC Midwest should be required to provide a historical time series of similar calculations to see if the dispute rate is increasing over time.[64] However, because CLECs are in complete control of when they perform audits and issue disputes, SBC Midwest has recognized that, month over month, there is no trend to point to. Claim amounts from month to month can vary from almost no claims, to significant volumes of claims. It is for this reason that SBC Midwest chose to select a long interval of time, 17 months, and performed the analysis on the billed revenue and claims over that period. This normalizes the month-to-month fluctuations and provides a meaningful comparison between the states.
80. As SBC Midwest has previously noted, disputes will inevitably arise in a complex commercial relationship such as that in which it and the CLECs operate. In some instances those disputes are resolved in favor of SBC Midwest and in some instances they are resolved in favor of a CLEC. Moreover, as SBC Midwest has candidly admitted, SBC Midwest has in the past – and in all likelihood will in the future – encountered errors as part of the billing process. CLECs likewise make errors. But that does not mean that such errors are due to systemic problems with billing systems or that such errors deny CLECs a meaningful opportunity to compete.
SBC MIDWEST’S PROCESSES TO ENSURE BILL ACCURACY
81. Several commenters have alleged that although SBC Midwest may have corrected past billing inaccuracies, SBC Midwest has not done enough to ensure that bills are accurate on a prospective basis.[65] Contrary to those allegations, SBC Midwest performs several activities in order to proactively identify potential billing problems. First, on a monthly basis, a sample of CLECs’ most frequently billed products is verified to ensure that the rates billed for those products are the same as what should be billed per the interconnection agreement price schedules. The bill validation process consists of extracting monthly billing recurring and non-recurring activity from month end CABS data files for a sample of CLEC products. This is performed for each of the five Midwest states. These billed rates are then compared to the control rates, which are maintained independently from the CABS Production Rate Tables. The Control Rates are updated based on information obtained from the CLEC price schedules. Any rate variances between the rates billed and the control rate for the sampled products are investigated and corrected. Additionally, each month one account is selected in each state where a fractional charge was billed. The fractional charges are manually recalculated to ensure the amount billed in CABS was calculated correctly. The rationale behind selecting one account in each state is: if the OC&C programs are calculating the OC&C correctly for one transaction it will calculate correctly for all transactions since the same code is being used. Any rate variances between the fractional charges calculated and the charges on the bill are investigated and corrected.
82. Second, on a bill period basis, the CABS Bill Data Tapes (“BDTs”) are reviewed to ensure they conform to Industry Standard Billing Output Specification format and the data on the BDT is syntactically correct. These bills are validated for completeness by ensuring that the minimum number of records is present on the file. The BDT records must also total up correctly. All detail billing charge records are totaled and reconciled against the summary charge records. The monthly access charges, usage charges, OC&Cs and amount due totals are verified. For example, the sum of all Other Charges and Credits must equal the OC&C charge total on the bill. Any anomalies detected are investigated and corrected.
83. Third, monthly access charges, usage charges, OC&Cs (including non-recurring charges and adjustments), and total amount due are tracked and trended on a monthly basis by the CABS controls system. On a bill period basis, warnings may be generated if there is a significant discrepancy in any of the amounts from one month to the next month’s bill. Warnings are investigated on a daily basis by reviewing the monthly bills and comparing the differences in the individual charges. When a large increase or decrease in billed revenue is detected, the appropriate service center is contacted by CABS Billing Operations to further investigate the customer’s bill and correct as necessary.
84. Even further, SBC Midwest is constantly looking at ways to improve processes and performance. Effective July 1, 2003, SBC Midwest implemented an internal database that tracks settlements and adjustments over $50,000. This new tool provides a means to sort data by root cause to determine trends and potential areas in need of process improvements.
85. With respect to rate administration, in addition to the dedicated contract management organization responsible for the development of price schedules for and management of pricing for each interconnection agreement,[66] SBC Midwest has reviewed existing processes and implemented improvements and controls as well as introduced new processes and controls. For example, during August 2002, SBC Midwest implemented an organization that provides a single point of interface between the SBC state and federal regulatory organizations and its Contract Management Organization to ensure that up-to-date regulatory filed and approved billing information and dates are implemented in the CMA database. During April 2003, the single point of interface organization was supplemented to provide additional support in the area of follow-up and validation. During this same timeframe, a control process was implemented between product management and contract management to manage rate changes originated by product management as opposed to regulatory changes through to billing.
86. Likewise, during March 2003, the key stakeholders representing contract management and CABS production support reviewed the processes for the distribution and exchange of information from the point of rate changes to the point of billing implementation. The team reviewed the distribution process in detail and implemented process improvements for the distribution of rate table data from the contract management pricing team to the CABS billing team. This effort resulted in formally documented process outlining steps and timeframes for each step.
87. SBC Midwest has continued to review and implement process improvements. One recent example is that SBC Midwest’s CABS production support is loading any rate changes that involve a prior effective billing date into an off-line test environment prior to loading the change into production to determine the financial assessment of the rate changes. The output of the test is provided to Contract Management for purposes of comparison of the financial impact against an expected result when the change is significant.
88. Furthermore, when SBC Midwest identifies CSI inaccuracies, these inaccuracies are corrected. As stated above, BearingPoint’s testing of the CSI record accuracy for Illinois, Michigan, and Ohio resulted in SBC Midwest slightly missing BearingPoint’s benchmark of 95 percent. However, SBC Midwest exceeded BearingPoint CSI testing benchmark in Indiana (96.8 percent) and Wisconsin (96.2 percent). When BearingPoint performed this portion of the OSS Test, there were instances in which BearingPoint counted as an error items which simply had not yet updated. As a result of the combined test results, SBC Midwest agreed to implement a CSI accuracy improvement plan, which was filed with the MPSC on March 13, 2003.
89. Contrary to CLEC allegations, it is clear that SBC Midwest has existing processes and procedures in place to ensure that it bills CLECs accurately. In addition, SBC Midwest has shown its commitment to refining or updating its processes when appropriate. Thus, SBC Midwest not only provides auditable, timely, and accurate bills today, but also has processes in place that will help to ensure it continues to do so in the future.
BILLING DISPUTE RESOLUTION
90. Notwithstanding the evidence of the accuracy and reliability of SBC Midwest’s billing systems and processes – confirmed not only by BearingPoint but by the individual state commissions and E&Y – it is simply inevitable that, from time to time, errors will occur within the billing process. But that does not mean that there are systemic billing issues or that SBC Midwest does not satisfy the requirements of checklist item 2. SBC Midwest has specific and workable processes and procedures in place to (a) ensure the overall accuracy and auditability of its wholesale bills and (b) resolve the inevitable disputes that arise regarding such bills. The disputes that do arise are generally the result of specific contract interpretation issues, rate administration issues, or simple misunderstandings and/or human errors. When errors are identified – either unilaterally by SBC Midwest or as a result of the established dispute resolution process – those errors are corrected.
91. ACN incorrectly asserts that SBC Midwest has claimed that its Bill Auditability and Dispute Resolution Plan addresses all of the billing issues in Michigan.[67] In all of its filings, however, SBC Midwest has correctly characterized the intent and purpose of this plan, i.e., to address CLEC comments made within the MPSC’s 271 proceeding[68] regarding the billing auditability and dispute resolution process. This plan was developed with input and comments from CLECs in Michigan during a collaborative workshop conducted March 4 – 5, 2003, and a follow-up conference call on March 12, 2003. The Plan was approved by the MPSC on March 26, 2003.[69] In approving the Plan, (and contrary to ACN’s opinion) the MPSC deemed it acceptable for SBC Midwest to self-report on a quarterly basis the progress achieved. As indicated in the two reports published to date,[70] all of the actions scheduled for completion to date have, in fact, been completed and have resulted in a new and effective venue for discussing and resolving billing claim issues. Although never intended to address any and all billing issues that may surface from time to time, this Plan has nonetheless proven effective in addressing many of the concerns raised thus far.
92. In addition, as noted in its initial filing, SBC Midwest has been working with the CLECs in a Billing Sub-Committee. As part of this sub-committee, operational questions with respect to the billing claims process are being answered and processes are being discussed and improved. Currently, there are proposals that have been shared with the CLEC community for the timeliness of acknowledging the claims received and the timeliness of resolving the claims. SBC is confident that the details of such measurements, once finalized, agreed-to by the collaborative, and implemented, will provide additional insight into the process of resolving billing claims.
93. Over 56 CLEC billing issues have been raised since the Billing subcommittee formed in the CUF on February 19, 2003. To date, 38 of those issues have been fully resolved. The parties are actively discussing the other issues, most recently at the subcommittee meeting held on August 19, 2003. For instance, as a result of the subcommittee discussions, SBC Midwest proposed a claims trial to allow CLECs to utilize the current standard forms and procedures but reduce the amount of information a CLEC must submit for multiple occurrences of the same issue. This may allow the LSC to investigate and resolve certain types of claims on an “issue” level, instead of an “item” level, potentially leading to more timely and efficient processing. Phase I of this trial, using simulated claims has been completed and the results have been shared with the sub-committee members. Phase II using live claims is currently in progress. SBC Midwest believes that it is on target for completion of all remaining actions in accordance with the dates established in the Commissions’ approved plan.
94. Notwithstanding SBC Midwest’s efforts, TDS states that it has experienced problems with the dispute resolution process.[71] However, TDS has recently submitted recommended process improvements to the Account Team. In turn, the Account Team has submitted TDS’s recommendations to the CLEC Billing Sub-Committee, in which TDS is an active participant. These recommendations have been reviewed and are scheduled to be addressed at the next Sub-Committee meeting in August. Many of the suggestions that TDS has recommended will be adopted based on the input of all CLEC participants.
95. Furthermore, Mr. Cox’s opinion regarding SBC Midwest’s billing dispute process[72] is not one that seems to be universally shared by fellow TDS employees. In an email to the LSC’s Billing group management team, a Mr. Todd McNally of TDS states, “TDS has done their fair share of raising concerns with SBC’s billing operations, but I wanted to take the time to compliment SBC on their efforts relating to a specific enhancement that they have implemented regarding the Billing Dispute Claim Resolution form. I am starting to see that the forms are coming back with the BAN and Customer Claim # which is very useful. Please pass this note on to those who have helped implement this specific enhancement.” See Attachment C. While Mr. McNally is referring to a specific enhancement, his email is an example of SBC Midwest’s willingness to work collaboratively with TDS and all CLECs in order to resolve issues. Mr. Cox’s blanket statement regarding the billing dispute process is rather disingenuous given the fact that his own organization recognizes the efforts being made by SBC Midwest on TDS’s behalf.
96. TDS claims that it has a dedicated billing team of 5 employees, which spend an estimated 30% of their time reviewing SBC Midwest bills and disputing inaccuracies.[73] Because of the potential for billing errors, most companies being billed by a service provider are going to dedicate a certain number of resources to auditing bills and working with that provider to correct inaccuracies. SBC’s Procurement organization utilizes both mechanical and human auditing processes to review supplier bills. SBC Midwest regrets that any errors exist, however the dedication of a 1.5 full-time equivalent headcount does not seem excessive for a company that received bills totaling approximately
*** *** between August 2002 and July 2003. SBC Midwest will continue to work with TDS on potential methods to reduce instances of billing issues in the future.
97. TDS makes the claim that SBC Midwest’s dispute resolution process practices are poorly managed, stating there is a “hodge-podge” of ways in which SBC Midwest handles billing disputes, indicating its billing systems lack adequate controls to assure consistent, accurate treatment of billing problems.[74] First, even if TDS was correct in its assessment of the management of the claims resolution process, making the leap to what this means about the controls in the billing systems is inappropriate. The process by which SBC Midwest manages claims is in no way related to the billing systems. However, TDS is not correct in its assessment of the claims process, as evidenced by the very examples it uses to support the assessment. TDS uses the following 3 examples: 1) “sometimes when TDS Metrocom submits a dispute claim, TDS Metrocom may eventually see an adjustment on a bill, but no notice of resolution of the claim;” 2) “TDS Metrocom often sees notices from SBC Midwest that a particular claim has been resolved, but the related adjustment does not appear on TDS Metrocom’s bills;” 3) “sometimes SBC Midwest sends acknowledgements of billing disputes to TDS Metrocom personnel other than those who submitted the claim.”[75]
98. The first example appears to simply be a timing issue. SBC Midwest currently sends resolution notices to CLECs at a file level. A file may contain hundreds of items to be investigated. If SBC Midwest resolves one item on a large claim, it is entirely possible that a bill containing an adjustment may be printed prior to SBC Midwest sending a resolution notice on the file. This does not necessarily indicate any problem at all.
99. The second example indicates the opposite scenario, that a claim resolution was communicated to TDS, however, the affected BAN has not gone through a bill cycle in order to reflect the adjustments. The LSC process requires that any adjustments be made prior to changing the status of the claim in our claim tracking system. However, if TDS truly believes that the adjustment has been inadvertently overlooked, they can submit another claim, or contact management via the number listed in the escalation procedures on CLEC Online.
100. In the final example, TDS raises the issue that acknowledgements may be sent to the wrong CLEC contact. WebTAXI, the system used by the LSC to track billing claims, has the capacity to store multiple e-mail addresses for each CLEC and relate them to CLEC BANS. The LSC claims process requires the service representative to chose the CLEC contact to receive the Resolution letter from a dropdown list of contacts that are related to the BAN the claim is on. This contact is defined in the process as the same one who sent in the CLEC’s claim. It is possible that acknowledgements could be inadvertently sent to the wrong contact within the CLEC, however the system has been designed in a way that this possibility should be minimized.
101. AT&T alleges that SBC does not comply with checklist item 2 as a result of completing several adjustments over the past few months. AT&T is incorrect. Despite AT&T’s refusal to utilize the normal billing claims process, SBC had been working on the investigation and correction of several billing issues that have already been addressed extensively in this record.[76] The culmination of the investigations and resulting credits have occurred over the past few months, and in some circumstances, SBC engaged an independent third-party auditor to provide assurance that these adjustments were applied accurately. While SBC would rather not have any billing issues, the resolution of these issues point to how effectively SBC responds to such billing claims.
102. The LSC Billing team has specific procedures and processes in place in order to make “every effort to resolve each claim within 30 days.”[77] The LSC Billing team investigates CLEC claims and processes the appropriate credits or sustains the charges depending on the results of its investigation. If the CLEC disagrees with the LSC Billing team’s findings, it can resubmit the claim along with further supporting documentation that may better substantiate the claim. If the LSC again finds that the charges are warranted and sustains them, the CLEC has the opportunity to dispute the charges through its SBC Midwest Account Manager. The LSC monitors claims on a case by case basis. When quality reviews are conducted by the Line Managers, it is noted if the claim was completed within 30 days, and if not, whether the appropriate communications were made to the CLEC.
103. The Claims checklist includes items such as:
• Review Interconnection Agreement site for contract information. If disputed rates are not included in the Interconnection Agreement, determine which Tariff applies and refer to on-line Tariff for rates.
• If unable to resolve claim within 29 days of receipt: Contact CLEC via Email to advise of current status of claim. Give estimated completion date of claim and set another FLUP for that date. Continue with this process until claim is either closed by the LSC or referred to BCATS.
• Update WebTAXI with date, time, name and notes of action taken in the resolution text field, change the status in WebTAXI to referred. Notes should be kept in resolution text until the claim is resolved. At claim resolution, copy resolution notes to the notes screen. All CLEC comments should then go into the Resolution text field. Be very specific, this is communication to the CLEC.
104. If a claim or adjustment is denied, the explanation of the denial is provided to the CLEC within the resolution text that is sent back to the CLEC. The expectation is that the text will include information that indicates how the LSC came to the resolution of denial. For example; “Denied, according to the contract, paragraph 1.10.5 the charge for UNE-P is $xx.xx. Based on charges noted on your invoice, the charge is appropriate.” The timeframe for providing the explanation is simultaneous with the resolution of the claim.
105. TDS states that it does not consider an issue closed until the billing problem is permanently fixed and all adjustments have been received and validated.[78] Process clarifications such as this are precisely the types of issues that are being worked in the Billing Sub-Committee of the CLEC User Forum. While TDS may not consider an issue closed until they have received and validated adjustments and received confirmation that a problem is permanently fixed, an understanding of the LSC Billing Claims processes would go a long way to alleviate TDS’ concerns. For order processing errors, the LSC Billing Claims process calls for inaccuracies to be corrected and any necessary adjustments to be made prior to notifying the CLEC that the claim has been resolved. If TDS believes there are ongoing issues, these issues should be worked through management in the LSC per the escalation guidelines posted on CLEC Online.
106. Moreover, Late Payment Charge (“LPC”) adjustments are incorporated into the Claims Investigation Process Checklist. The specific direction given to the SBC Midwest LSC Service Representative states that, “If adjustment/credit is required: (the Service Representative should) Verify Late Payment charges should be credited.” See Adjustment section.
107. The Adjustment section of the Service Representative Methods and Procedures (“M&P”) further explains the process to be followed by the Service Representative as follows: When the claim has been investigated and results in an adjustment, issue the adjustment. Once all items on the claim spreadsheet are resolved, the status of the claim can be changed to Resolved and Closed. A Resolution Letter will be sent identifying the amount to be adjusted. If the claimed amount is adjusted (in favor of the customer), Late Payment Charges will also be adjusted.
MISCELLANEOUS CLEC ALLEGATIONS
AT&T Corporation
108. AT&T asserts that SBC incorrectly billed DUF rates in Indiana.[79] AT&T raises two issues, which apparently have become confused. The first item raised by AT&T has to do with a usage rate issue AT&T brought to SBC’s attention. After researching this issue, SBC determined that a rate table update was necessary. SBC implemented the rate table modification and provided a credit to AT&T on July 13, 2003, which SBC communicated with AT&T during a conference call on July 16, 2003. The second issue has to do with a rate structure/rate change ordered by the Indiana Utility Regulatory Commission (“IURC”) in Cause No. 40611-S1 on March 28, 2002. See Phase I UNE Order, Commission Investigation and Generic Proceeding on Ameritech Indiana’s Rates for Interconnection, Service, Unbundled Elements, and Transport and Termination under the Telecommunications Act of 1996 and Related Indiana Statutes, Cause No. 40611-S1 (IURC Mar. 28, 2002) (App. D-IN, Tab 14) (“IURC Rate Order”). It appears that during the July 16 call to discuss the adjustment described above, there was miscommunication between the parties regarding the rate table change and the IURC’s March 20, 2002, rate structure/rate change. A copy of an Amendment including this issue was provided to AT&T on August 23, 2002. This Amendment to AT&T’s interconnection agreement (“ICA”) would be necessary to receive the IURC March 2002 DUF rate (i.e., $.1070664 per port per month instead of the per message charge). AT&T’s ICA provided that the Parties would amend AT&T’s ICA to incorporate such revised rates. There was no communication from AT&T regarding this amendment until March 2003. To date, AT&T has not signed the amendment, as the Parties are still negotiating mutually agreeable terms and conditions. Therefore, SBC is charging AT&T the DUF per message rate pending the finalization of the Amendment.
109. AT&T asserts that SBC Midwest’s fix for the loop zone inaccurate billing was incomplete until third-party review, and insufficient information was provided to validate the correction.[80] With auditing and independent verification by a third-party (E&Y), each and every wire center’s applicable billing rate zone (across the five Midwest states) has been now validated to be correct. These rate zones are correctly programmed in SBC Midwest’s billing systems, which applies the correct rate to for the loop to the CLEC’s bill. In instances where multiple rate zones are applicable for a single wire center, SBC Midwest defaulted to the lower rate for the recent correction, and issued any applicable credits retroactively to the service established date of the loop. AT&T specifically asked for further clarification on July 28, 2003 to support the adjustments that appeared on the June 2003 bill. A response was provided to AT&T on August 6, 2003, which is attached as Attachment D.
110. AT&T indicates it has “confirmed” that SBC Midwest is impermissibly charging non-recurring charges for new “UNE-P” installations identified as “cut-through” or no field work orders (“NFW”) even though it is not actually performing the work that those charges are designed to recover.[81] As AT&T acknowledges, both parties were working together to analyze its trouble tickets for no dial tone and had undertaken an investigation to determine the root cause of AT&T’s “unproductive truck rolls” complaints. While the teams had been working together on this operational analysis, AT&T outlined in a July 23 email its request to add the issue as a topic for discussion on a monthly Leadership Call scheduled for July 30. This request identified AT&T’s concern regarding the NRCs for “NFW.” During the call, SBC Midwest proposed to review the contracts and tariffs for all regions and evaluate actual NRCs being charged to ensure compliance with contractual obligations. AT&T agreed that this would be an ongoing review and any discrepancies would be addressed. The response to this business-to-business approach was AT&T’s filing the issue in this proceeding just five business days later.
111. Based on SBC Midwest’s research and understanding of AT&T’s comments in this proceeding, it appears that AT&T is mistaken as to when new installation non-recurring rates apply compared to when migration non-recurring rates are to be applied.
112. AT&T has based its claim that improper non-recurring charges were applied in Illinois, Ohio and Michigan[82] on order information it obtained from Performance Measurement 28 where “new” orders reflected “no field work.” However, the issue of what the applicable rate is for a “no field work” order, depends on the particular state and circumstances of that order and cannot be explained by a simple comparison of performance measurement raw data as AT&T has attempted to do.
113. First, with respect to Illinois, AT&T’s pricing is driven by tariff,[83] and provides that the new installation non-recurring charges are to be applied when a new order type is requested via the service order. If when a CLEC generates a Local Service Request (LSR) to SBC Midwest the LSR type is “N” or “T” for a new UNE-P combination or an additional line, the Loop Connection Charge of $20.21[84] and the Record Order Charge of $1.02 is to be billed. These rates were established by the Illinois Commission taking into consideration that there would be orders not requiring outside plant work that would require central office work and orders that would not. This is what SBC Midwest is billing for these order types in Illinois. It is only for Migration orders where the order contains a RECTYP M and activity type of “V” that the migration charge of $1.02 is to be applied. The $1.02 is the charge that SBC Midwest is billing for the Migration order types. Thus, SBC Midwest does not believe that it is billing AT&T incorrectly in Illinois.[85]
114. With respect to Michigan[86] and Ohio[87], the state commissions have specified that the non-recurring charge(s) for UNE-P combination orders are different depending upon whether or not there is physical work to be done in provisioning the combinations, including central office work efforts. AT&T apparently believes that if SBC reports a “no field work” status, no physical work is necessary to install the “New” UNE-P combination. However, a “no field work” condition simply indicates that there was no outside plant work necessary. It does not necessarily mean that there was no physical work necessary to install the UNE-P combination (e.g., central office work to place a jumper). As a result, depending on the particular circumstance, SBC does appropriately bill the new UNE-P installation non-recurring charges when there is a “no field work” condition.
115. Based upon its investigation, SBC Midwest believes that it is also properly billing in Michigan. For AT&T in Michigan, there were a total of *** *** new orders that were included in Performance Measure 28 data in July with a status of “no field work”. AT&T was billed at the lower rate for approximately *** *** of these “no field work” orders. The orders that make up the *** *** did not require any physical work within the central office to install them. The remaining *** *** of the July AT&T “no field work orders” did require physical work within the central office and were appropriately billed at the new installation rate. Through its investigation, SBC Midwest has determined that the programming logic necessary to distinguish the different types of “no field work” orders was not implemented for Ohio. SBC Midwest will implement the logic for Ohio similar to Michigan in the next system release, which is scheduled for October 8, 2003.[88] To ensure accurate billing in the interim, SBC Midwest will manually adjust the charges on AT&T’s (and other impacted CLEC’s) invoices to the correct rate. SBC Midwest will work with AT&T and any other impacted CLECs to apply adjustments as appropriate.
116. AT&T also complains about an Accessible Letter that SBC released on July 24, 2003.[89] As the result of investigating a recent CLEC billing claim, SBC determined that approximately 1400 UNE-P circuits across SBC’s five Midwest states were billed incorrectly due to an ordering system error introduced with the March 2003 OSS release. This issue impacts a limited number of circuits and SBC immediately implemented the correction on August 1, 2003, to resolve this problem prospectively. SBC has targeted to complete the credit calculation by the first week of September, and issuing the appropriate adjustments for the impacted circuits back shortly thereafter. As AT&T mentions, SBC issued Accessible Letter CLECAMS03-051 on July 24, 2003 to communicate appropriate information to the impacted CLECs. See Exhibit 4 to the DeYoung/Tavares Decl.
CHOICE ONE COMMUNICATIONS INCORPORATED
117. Choice One states that not all of SBC’s invoices are available electronically.[90] It is true that LEC Services Billing (“LSB”) statements are paper bills and are not available electronically. As previously explained however, LSB bills CLECs, ILECs, IXCs, transport hub providers and other telecom service providers for certain miscellaneous services, including services such as Calling Name and Delivery (“CNDS”) and certain operator services and directory assistance (“OS/DA”) – e.g., one-time set up fees for operator switch and switch based (non-UNE-P) usage. Paper copies of the bills are printed and mailed to the customer, which provide the ability for auditing.
118. Additionally, Choice One states that transit charges for access to the CNAM database are on separate invoices while all other CNAM charges are on one invoice.[91] Choice One does receive two invoices for both Indiana and Michigan usage. However, LSB has the flexibility to combine these products on one invoice per state, upon customer request. This request can be made to the LSB unit, from the customer, via telephone or in writing. As of August 22, 2003, the LSB manager has phoned Choice One, and left two voicemail messages offering to assist in any requests.
CIMCO COMMUNICATIONS INCORPORATED
119. CIMCO claims that SBC incorrectly bills them continuously and submits a bullet point list of complaints, yet provides no details.[92] Just as with all CLECs, all of CIMCO’s submitted claims are investigated and in some cases, credits are rendered. Some of the areas where CIMCO has received credits are for NRC port charge migrations, ISDN provisioning, PIC and IntraLATA toll billing. However, for the majority of CIMCO’s examples, these issues have either been closed for some time, relate to issues SBC Midwest has already discussed at length in this application, or have not been brought to the attention of SBC Midwest. For instance, the “double billing” claim is apparently in reference to an issue that was closed in mid 2002. Issues related to “directory assistance” have been discussed at length in this application, and SBC Midwest’s corrective action was implemented some time ago. See Brown/Cottrell/Flynn 4-State Aff. ¶ 146 & n.141. Another example is the assertion regarding incorrectly billed taxes, which has yet to be identified as an issue with the account team. SBC is interested in working with CIMCO on a business-to-business basis on any questions or concerns that surface. In addition, as CIMCO is often interested in ordering new products and services before they are ready to roll out, sometimes this creates a billing issue that must be worked out between the companies. CIMCO and SBC have worked together to trial services and have even applied non-traditional methods to make services available, so as to avoid delaying CIMCO’s product rollouts.
forte communications incorporated
120. Forte alleges that incorrect billing is a monthly occurrence, yet its filing consists of several bullet points that identify NRC port charges, installation charges, migration charges, DUF rates, NRCs and MRCs.[93] Forte provides no details, but SBC is aware of “contract versus tariff” interpretation issues with Forte in the past. For instance, an investigation was performed that determined that Forte’s UNE-P rates should be provided out of the applicable tariff, rather than its ICA. This issue was corrected on a prospective basis on March 18, 2003. A similar interpretation issue was recently resolved with respect to DUF rates. A rate table correction was made on August 20, 2003 that changes the rates on a prospective basis to the tariff rate. SBC is working with Forte to complete this adjustment.
121. As to its claim of incorrect usage billing, Forte did file disputes on the usage rates for reciprocal compensation SBC was charging them. These disputes were denied however, and SBC and Forte mutually agreed that SBC was charging the correct rate. Indeed, the error was Forte’s, who was charging SBC an incorrect rate. Subsequently, Forte submitted back bills to SBC for reciprocal compensation usage in the approximate amount of $79,022.44, although SBC disputes a portion of these charges.
122. Finally, Forte alleges it is being double billed for the same circuit on different parts of the bill. SBC is unaware of this claim from Forte, but is more than willing to work with Forte to investigate and resolve any circuits they believe are being double billed. Forte should simply utilize the billing dispute process, rather than presenting billing disputes for the first time in a section 271 proceeding.
INDIANA OFFICE OF UTILITY CONSUMER COUNSELOR (“IOUCC”)
123. The Indiana OUCC comments that “until CLECs can trust that their orders will be correctly and smoothly processed and that they will be accurately and fairly billed for services … their entry into Indiana’s competitive local exchange market will be unnecessarily restricted or delayed.”[94] With all of the evidence on the record, specifically the BearingPoint test and the E&Y validation, in addition to the substantial market entry in the other SBC Midwest states using the same ordering, provisioning and billing systems, SBC Midwest does not believe the IOUCC’s concerns have merit.
124. The IOUCC points to Observation No. 174, first issued in December 2001, as evidence that SBC Midwest continues to wrestle with such unresolved problems.[95] To the contrary, however, this observation shows that SBC Midwest has resolved billing problems brought to its attention in a timely manner and continues to do so. As noted in its Closed Observations Status Report,[96] the issue, which involved different interpretations of a billing specification requirement, was resolved to BearingPoint’s satisfaction on March 26, 2003. As explained previously in this affidavit, billing issues can and will continue to surface from time to time given the complexity of the billing systems and the enormous volume of transactions they handle. What is important, however, is the fact that, as they are identified, SBC Midwest is committed to addressing them in a timely manner.
MCI
125. MCI states that several issues have been resolved with SBC in which SBC has agreed to make payments to MCI, including payments of interest, but inexplicably SBC has not yet made the payments it promised.[97] SBC has calculated pre and post petition credits due to MCI and the majority of the credits have already been applied to MCI’s accounts. SBC has agreed to pay MCI interest on post petition credits in accordance with the applicable ICA, and SBC is in the process of calculating the interest due MCI.
126. MCI cites to the fact that the PSCW opened an investigation to address certain billing issues. MCI maintains that this docket was opened “to investigate the serious billing concerns raised by various CLECs who are operating in the state.”[98] In making these assertions, MCI fails to note that the PSCW’s Phase II Determination in the 271 proceeding found no evidence of systemic problems in Wisconsin Bell’s billing systems.[99] Indeed, the PSCW found no evidence of “pervasive” problems; rather, the PSCW characterized the CLEC complaints as “anecdotal.”[100] In fact, the PSCW went so far as to question the motives underlying the CLECs’ billing complaints. Specifically, in its Phase II Determination, the PSCW stated:
The record on billing contains factual disputes and evidence of systemic problems with SBC’s performance is lacking. CLEC comments on this issue are anecdotal in nature and lack specific, quantifiable documentation. In addition, it is not clear whether the alleged problems represent disputed contract interpretations that relate to billing rather then [sic] failures of SBC’s billing systems. If billing issues are as pervasive as the CLECs argue, the Commission would have expected to see formal complaints filed by CLECs under state law and/or their interconnection agreements. No such actions have been filed, although the Commission is aware that some CLECs have been involved in extensive business-to-business discussions over billing issues in recent months, and in some cases, with Staff facilitating those discussions. The fact that CLECs have grown their businesses in spite of unresolved billing issues suggests that SBC billing systems are not fatal to competition, but nonetheless could be imposing costs on CLEC’s internal resources which ultimately inhibit competition. In any event, the Commission concludes that these are specific carrier-to-carrier billing related issues and are not indicative of any systemic problems with SBC Wisconsin’s billing systems. SBC and the CLECs clearly disagree with respect to extent and scope of billing issues.
CLEC concern over billing issues has dramatically increased in this docket in just the past few months, coincident with the SBC Michigan’s § 271 application before the FCC. That is not to say, however, that these concerns are unfounded. Unfortunately, these concerns were not raised sooner in this proceeding, or in the OSS docket (6720-TI-160), where they could be fully explored and addressed.[101]
127. As this passage demonstrates, and contrary to MCI’s characterizations, the PSCW did not recommend approval of Wisconsin Bell’s application despite billing problems; rather, the PSCW recommended approval because no pervasive, systemic problems exist.
128. In fact, when it opened its billing docket, the PSCW reiterated its finding that Wisconsin Bell’s billing systems function adequately. The Notice establishing the docket stated that, “[i]n the 47 U.S.C. § 271 checklist proceeding, the Commission determined that SBC Wisconsin had passed 100 percent of the MTP Testing Criteria regarding billing and that the record did not indicate the existence of any systematic problems in SBC Wisconsin’s billing systems.”[102] Moreover, the Notice opening the billing docket also makes clear that the docket is designed to address concerns with CLEC billing systems as well: “This investigation will also consider issues or problems related to bills submitted to SBC Wisconsin by CLECs.”[103]
129. Finally, it is important to note that the PSCW has not made any findings in its newly-opened billing docket. Indeed, MCI fails to mention that Wisconsin Bell’s initial responses to the CLECs’ complaints are not due until the end of August 2003. Following the filing of the responses, a series of technical conferences will be held to address the issues and to evaluate further actions, if necessary.
MPOWER
130. Mpower, as part of a joint filing with ACN, Bullseye, Choice One, CIMCO, Indiana Fiber Works, Mpower and Powernet, alleges that SBC bills Mpower incorrectly for local termination traffic at the local rate.[104] On February 25, 2003, the SBC Midwest account team was advised of Mpower’s dispute of SBC’s billing of local usage. Through SBC Midwest’s investigation, it was determined that Mpower’s contract language for local is Bill & Keep and should be adjusted. On April 15, 2003, the rate tables were revised to zero rate the Bill & Keep billing requirements. Although SBC Midwest had not updated the rates correctly, this issue is related to a simple manual error, has been closed for several months and all credit adjustments have been processed.
131. Mpower also alleges the dispute resolution process “leaves much to be desired,” claiming that disputed charges remain within outstanding balances, causing late charges on the disputed amounts and causing Mpower to have to re-dispute already disputed charges every month.[105] These comments demonstrate a severe lack of understanding for the dispute process. Once a claim is received by SBC, it takes time to investigate the claim. After the investigation is completed an adjustment if appropriate, will be made to the CLEC invoice which has an outstanding balance remaining. In addition, it is SBC’s policy to adjust late charges associated with outstanding balances that are part of valid claims. If Mpower is re-disputing claims every month, they are not only causing more work for themselves, but also very likely confusing the claims process by sending in multiple, duplicate claims for the same issue. SBC would encourage Mpower to work with SBC to ensure a correct understanding of the process, and perhaps get involved in the billing sub-committee of the CUF where the claims process is being discussed.
132. In addition, Mpower alleges that SBC Midwest rejects disputes that Mpower files without any investigation. SBC Midwest’s service representatives found to be purposely falsifying the resolution of claims by representing that they have performed sufficient investigation to reach resolution, in contravention of the Code of Business Conduct, would be subject to disciplinary action, up to and including dismissal. The allegation that SBC Midwest service representatives fraudulently reject claims is specious.
NORTHERN TELEPHONE AND DATA CORPORATION
133. NTD alleges that on March 5, 2003, SBC disconnected nine of NTD’s largest customers with no warning and no cause, and in violation of the ICA; that its customers were out of service for some period of time; that SBC Midwest’s actions directly injured NTD business by striking at NTD’s most lucrative accounts; and that exacerbating the injury, SBC solicited those accounts, stating falsely that NTD was in financial difficulty.[106] NTD fails to note that this disconnection was for non-payment of access services, and not subject to the terms of the NTD’s ICA. SBC had attempted to negotiate access payment arrangements with NTD, but no agreement could be reached. When NTD failed to make payment, following the documented business process and rules, the service was disconnected. NTD was notified and given sufficient time to make payment prior to the service disconnection. This is not an anticompetitive practice as NTD asserts. In fact, SBC expedited the re-instatement of the service following the payment to minimize any impacts on NTD and its customers. SBC denies any knowledge of SBC employee solicitation of NTD accounts, nor discussion related to the solvency of NTD’s business. If NTD can provide any details, SBC will investigate this issue.
134. NTD alleges that SBC bills contain a high frequency of errors, covering extended periods of time, and impacting their ability to bill their end users. NTD Comments at 5-6. As with any other CLEC, some of NTD’s billing claims are credited and some are denied. In instances where NTD does not agree with a denial, NTD has failed to follow processes to ensure that the issue is re-reviewed. Often, upon receipt of a claim denial, NTD does not resubmit or even resurface the claim for many months. Instead, NTD apparently maintains a running list of issues without allowing for closure on any. In addition, SBC believes that when NTD learns that an event occurred to another CLEC, it immediately enters the issue as a claim or onto the open issues log, assuming without investigation that the same event could occur in their billing.
135. Additionally, NTD continues to bring up old issues that have been resolved. For instance, NTD references labor charges dating back to May 2002 found on its February 2003 invoice. SBC determined that maintenance charges for billable trouble ticket dispatches were not billed to NTD for any UNE-P customers. SBC billed NTD according the terms and conditions of its ICA. However, this issue has been closed for 5 months.
136. SBC also acknowledges that there was a rate discrepancy in Wisconsin with the transit charges that resulted from a contract interpretation issue. SBC Wisconsin, however, worked diligently with NTD to correct the rates and to apply the necessary adjustment. Resolution of this issue resulted in a credit balance to NTD, which was remitted to NTD on August 16, 2002, pursuant to an agreement with NTD. Notably, this issue likewise is old and has been closed with NTD for over a year.
OHIO CONSUMERS’ COUNSEL
137. The OCC alleges that the DOJ’s refusal to support SBC Michigan application was due to problems with the databases and processes by which data is entered and extracted. OCC Comments at 8-9. Specifically, the OCC mentions that Michigan’s performance metrics do not test for billing problems at this level. First, BearingPoint thoroughly tested SBC Midwest’s billing systems and processes, a test that SBC successfully passed. Second, E&Y validated the application of correct rates, which is a significant contributor to accurate billing, and found a very low error rate, based on the most commonly ordered UNE products. Third, the rates identified on the CLECs bills are sampled against the Rate Control Tables in CABS and reported in Performance Measurement 14. Finally, the CLECs and state commissions have significant input to adding, deleting and modifying the 271 performance measurements at each 6-month review.
TDS Metrocom
138. TDS largely repeats the same allegations that it has filed in Michigan since January – issues SBC Midwest has already shown to be dated and/or closed in both the Michigan docket and its initial filing in this proceeding.[107] TDS acknowledges that SBC Midwest has made some progress in solving specific billing related errors as they arise, but also indicates SBC Midwest has yet to prove that it has done a comprehensive review of their processes and systems to correct hidden errors and ensure future errors are minimized.[108] However, other than outdated disputes or minor issues either currently in negotiation or corrected by SBC Midwest, TDS provides no evidence of systemic billing issues.
139. TDS asserts that SBC back billed them for directory assistance services for twelve months and calling name and delivery service for sixteen months. The TDS DA issue was closed when TDS posted payment on January 8, 2003, prior to SBC Midwest’s Michigan application.
140. TDS states they recently uncovered problems with inconsistent and missing residential and business indicators on certain bills and that this problem is impacting newly acquired customers and has been happening sporadically since April 2003.[109] This problem was specifically related to a system error introduced during an order entry system enhancement on April 20, 2002. The problem was identified and corrected systematically on November 9, 2002. A mechanized program was then developed to issue credits to all CLECs, including TDS, for the embedded base of loops impacted between April 20, 2002 and November 9, 2002. All such adjustments were accurately issued by June 15, 2003, and thoroughly validated by E&Y. With independent E&Y audit and verification, it was verified that no new instances of this type of Res-Bus Misclassification error occurred after the system was fixed on November 9, 2002.
141. TDS comments that since August 2002, TDS has opened disputes equal to 20% of the total amount billed by SBC during that period stating that of the amount resolved during this period, over 87% were resolved in TDS’s favor.[110] Although TDS claims to have disputed 20% of the total amount billed, one should not assume that SBC Midwest billed TDS inappropriately for those dollars disputed due to billing system errors. For example, SBC Midwest believes that it has been billing TDS properly for “redundant” collocation power within its collocation spaces. However, TDS recently filed disputes for its power arrangements in the total amount of *** *** in the states of Ohio and Wisconsin. That means that over 11% of TDS’s total dollars in dispute during the period of August 2002 through July 2003 (*** ***) is related to a single disputed issue between the parties.
142. TDS states that SBC recently advised TDS of an adjustment covering several issues in its 3 Midwest states (IL, MI and WI) and as usual nearly $150K will be owed to SBC.[111] It further states that SBC does not provide adequate data and descriptions regarding adjustments on its bills. SBC is not aware of the specific example that TDS provides, as TDS provides no indication what the billings are associated with and what timeframes these represent. SBC did have a discussion regarding what TDS felt was insufficient information being provided on its bill related to the loop zone issue. The SBC Account Manager forwarded a letter (Attachment E) to TDS with additional information. TDS indicated that it was satisfied with this additional information. SBC Account Management is committed to continue working on a business to business basis when needed.
143. TDS cites three perceived limitations of the PSCW Billing Proceeding. First TDS states it hopes “that the proceeding will develop into regional collaborative investigation much like sessions that have dealt with other OSS issues.”[112] TDS goes on to suggest “another draw back of the PSCW proceeding is that SBC did not voluntarily agree to the commencement of the investigation.”[113] TDS suggests a third drawback with the PSCW proceeding is it “is not directly tied to the 271 processes.”[114] In responding to TDS, it’s important to reiterate the PSCW determination with regard to billing. Specifically, in its Notice establishing the docket PSCW stated that, “[i]n the 47 U.S.C. § 271 checklist proceeding, the Commission determined that SBC Wisconsin had passed 100 percent of the MTP Testing Criteria regarding billing and that the record did not indicate the existence of any systematic problems in SBC Wisconsin’s billing systems.”[115] A linkage to the §271 proceeding is inappropriate given the PSCW’s determination. Likewise given the state jurisdiction of the PSCW, it is unreasonable to contend that the PSCW should assert jurisdiction over activities occurring in other states. Finally, TDS’ allegation that SBC Wisconsin did not “voluntarily undertake the docket” is irrelevant. The fact of the matter is that SBC Wisconsin is vigorously participating in the docket, preparing its responses to the issues raised by the CLECs and providing CLECs certain information upon request, pursuant to the PSCW’s instructions. One must remember that the PSCW’s docket was opened to consider CLEC billing practices as well as SBC Wisconsin’s; SBC Wisconsin hopes the CLECs take the opportunity afforded by the docket to consider and improve their billing systems which, unlike SBC’s, have not undergone rigorous testing.
Z-TEL COMMUNICATIONS INCORPORATED
144. Z-Tel asserts that SBC refuses to correct known billing errors and that even though SBC may actually provide bill credits at some point, it refuses to update its underlying billing system to correct known errors so the same problems persist for months.[116] For order processing errors, the LSC Billing Claims process calls for inaccuracies to be corrected and any necessary adjustments to be made prior to notifying the CLEC that the claim has been resolved. If Z-Tel believes there are ongoing issues, these issues should be worked through management in the LSC per the escalation guidelines posted on CLEC Online.
145. Z-Tel asserts that although the IL TELRIC rate for a service order charge is $1.02, SBC routinely (but inconsistently) charges Z-Tel $14.60.[117] This is related to a contract interpretation issue between the parties. Z-Tel has asserted that a tariff rate change automatically flows through to their contract. Although SBC does not agree with Z-Tel’s position, SBC has consistently offered Z-Tel a contract amendment to obtain the new rate. SBC has been working diligently with Z-Tel to resolve this issue, but clearly this is simply an interpretation question.
146. Additionally Z-Tel states that SBC changes it TELRIC rate for shared transport (known as “ULS-ST”) every few months without any warning or any rationale. Z-Tel Comments at 11. This issue stems from a rate structure/rate change ordered by the IURC in Cause No. 40611-S1 on March 28, 2002. See IURC Rate Order. SBC Midwest does not change its rates “every few months” as alleged by Z-Tel. Z-Tel Comments at 11. There were some rate issues in the past related to these Indiana usage charges. However, SBC Midwest has already addressed and corrected this issue and E&Y validated the corrective action. See Brown/Cottrell/Flynn 4-State Aff., ¶ 102, n.93.
CONCLUSION
147. In sum, SBC Midwest’s billing systems provides CLECs with nondiscriminatory access to billing functionality. This is true despite the incredible complexity and scope of billing functionality SBC Midwest provides to CLECs, as well as the large commercial volumes of billing transactions processed by SBC Midwest’s billing OSS. In some cases, CLECs raise issues about single circuits that are allegedly billing incorrectly, portraying them as symptomatic of systemic billing problems. Moreover, CLECs have been processing what appear to be normal billing claims through this 271 docket, and their motives are very transparent. Generally, the CLEC comments that have been submitted to date are either lacking details, old issues that have previously been resolved or impact a very small fraction of a percent of the overall circuits. Indeed, many are contract interpretation disputes and not billing system issues at all. In short, SBC Midwest’s billing OSS clearly provide CLECs operating in Michigan with a meaningful opportunity to compete.
148. Pursuant to Part II. E. of the Consent Decree entered into between SBC Communications Inc. and the Federal Communications Commission, released on May 28, 2002, see Order, In the Matter of SBC Communications, Inc., 17 FCC Rcd 10780 (2002), we hereby affirm that we have (1) received the training SBC is obligated to provide to all SBC FCC Representatives; (2) reviewed and understand the SBC Compliance Guidelines; (3) signed an acknowledgment of my training and review and understanding of the Guidelines; and (4) complied with the requirements of the SBC Compliance Guidelines.
149. This concludes our affidavit.
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[1] When used in this affidavit, the term “SBC Midwest” refers to the five state local exchange carrier operations of Illinois Bell Telephone Company (“Illinois Bell”); Indiana Bell Telephone Company, Incorporated (“Indiana Bell”); Michigan Bell Telephone Company (“Michigan Bell”); The Ohio Bell Telephone Company (“Ohio Bell”); and Wisconsin Bell, Inc (“Wisconsin Bell”). All five SBC Midwest states utilize the same billing systems, which are managed, monitored and maintained on a region-wide basis.
[2] See Affidavit of Justin W. Brown, attached to Joint Application by SBC Communications Inc., Illinois Bell Telephone Company, Indiana Bell Telephone Company Incorporated, The Ohio Bell Telephone Company, Wisconsin Bell, Inc., and Southwestern Bell Communications Services, Inc. for Provision of In-Region, InterLATA Services in Illinois, Indiana, Ohio, and Wisconsin, WC Docket No. 03-167 (“Brown 4-State Aff.”) (App. A, Tab 5).
[3] See Joint Affidavit of Mark J. Cottrell and Beth Lawson, attached to Joint Application by SBC Communications Inc., Illinois Bell Telephone Company, Indiana Bell Telephone Company Incorporated, The Ohio Bell Telephone Company, Wisconsin Bell, Inc., and Southwestern Bell Communications Services, Inc. for Provision of In-Region, InterLATA Services in Illinois, Indiana, Ohio, and Wisconsin, WC Docket No. 03-167 (“Cottrell/Lawson 4-State Aff.”) (App. A, Tab 11).
[4] See Joint Affidavit of Justin W. Brown, Mark J. Cottrell, and Michael E. Flynn, attached to Joint Application by SBC Communications Inc., Illinois Bell Telephone Company, Indiana Bell Telephone Company Incorporated, The Ohio Bell Telephone Company, Wisconsin Bell, Inc., and Southwestern Bell Communications Services, Inc. for Provision of In-Region, InterLATA Services in Illinois, Indiana, Ohio, and Wisconsin, WC Docket No. 03-167 (“Brown/Cottrell/Flynn 4-State Aff.”) (App. A, Tab 6).
[5] TDS’s claim that CLEC interviews were not included is disputed by the BearingPoint report itself. See TDS Comments at 6. For example, Section II.B.10.2 of the Ohio Interim OSS Status Report notes: “BearingPoint also conducted interviews with CLECs that offered service within the SBC Ameritech region. Topics discussed included the CLECs’ experience with using SBC Ameritech help desks, issues that CLECs have experienced, and other billing-related concerns. CLEC interviews were conducted in April 2002, May 2002, and October 2002.” BearingPoint, Ohio Interim OSS Status Report at 101 (Dec. 20, 2002) (“Ohio Interim Status Report”) (App. C-OH, Tab 101).
[6] See TDS Comments at 6; Comments of ACN Communications Services Inc., Bullseye Telecom Inc., Choice One Communications Inc., CIMCO Communications Inc., Indiana Fiber Works LLC, Mpower Communications Corp., and PowerNet Global Communications, Inc. at n.9 (“ACN Comments”).
[7] See Brown/Cottrell/Flynn 4-State Aff. ¶ 13.
[8] Id. (citation omitted).
[9] See ACN Comments at 9.
[10] See, e.g., Ohio Interim Status Report at 113.
[11] See BearingPoint OSS test results for PPR13-5 (e.g., Ohio Interim Status Report at 713-715).
[12] Conducted March 4-5, 2003.
[13] See Joint Declaration of Sarah DeYoung and Shannie Tavares ¶ 18 (“DeYoung/Tavares Decl.”); Lichtenberg Mich. Decl. ¶ 14. Although Ms. Lichtenberg filed a Declaration in this proceeding (“Lichtenberg 4-State Decl.”) “updating the record” she attaches, as Tab 2, her Michigan Declaration filed in WC Docket No. 03-138 (“Lichtenberg Mich. Decl.”).
[14] See Brown/Cottrell/Flynn 4-State Affidavit ¶¶ 49-57.
[15] This is a statistically valid sample size. See KPMG Consulting, Illinois Commerce Commission Ameritech OSS Evaluation Master Test Plan, Version 2.0, at 103 (May 2, 2002) (“Illinois MTP”) (App. M, Tab 77).
[16] See DeYoung/Tavares Decl. ¶ 18.
[17] See Brown/Cottrell/Flynn 4-State Aff. ¶¶ 83-84.
[18] Id.
[19] Id. ¶ 95. The samples from live customer records that E&Y selected included those MRCs and NRCs that are most frequently ordered by and billed to the CLECs. For example, MRC USOCs included within the sample represented more than 82% of the UNE Loop MRC USOCs and about 100% of the UNE-P MRC USOCs most frequently ordered by and billed to the CLECs. NRC USOCs included within the sample represented more than 86% of the UNE Loop and about 100% of the UNE-P NRC USOCs most frequently ordered and billed to the CLECs. NRC USOC charges are one time event charges billed through CABS. Examples of UNE-P NRC USOC charges are NHCHG – Migration Charge, NR9UV – Subsequent Service Order and NR90E – Loop Service Order-Disconnect.
[20] Id. ¶¶ 96-103; see Horst June 2003 Supp. Aff., Attach. C at 31-33, attached in its entirety to the Brown/Cottrell/Flynn 4-State Aff. as Attachment F. The previously identified Indiana usage rate errors account for over one-half of the 3.16% usage error rate in the SBC Midwest Region. See id. ¶ 102.
[21] Many of the issues raised by CLECs have not been raised through the formal dispute process.
[22] See DeYoung/Tavares Decl. ¶¶ 34-47; Lichtenberg Mich. Decl. ¶¶ 3-28.
[23] In some cases, OC&C dates were revised.
[24] See Horst June 2003 Supp. Aff., Attach. B at 7.
[25] See DeYoung/Tavares Decl. ¶¶ 48-52.
[26] See Horst June 2003 Supp. Aff., Attach. C at 6.
[27] See Lichtenberg Mich. Decl. ¶¶ 12-16.
[28] See Brown/Cottrell/Flynn 4-State Aff. ¶ 62, n.54.
[29] See Lichtenberg Mich. Decl. ¶ 11.
[30] Id. ¶ 25.
[31] Id. ¶ 28.
[32] For example, the LSC does not perform the cross-connection of facilities, circuit design, installation, maintenance and repair functions.
[33] See Lichtenberg Mich. Decl. ¶ 17.
[34] See DeYoung/Tavares Decl. ¶ 39.
[35] See Brown/Cottrell/Flynn 4-State Aff. ¶ 21.
[36] MCI Comments at 6-8; Lichtenberg Decl. ¶¶ 13-16. In both of these documents, MCI refers to 5,612 telephone numbers referred to SBC for review. The actual number of telephone numbers referred to SBC for review was 6090.
[37] DeYoung/Tavares Decl. ¶ 13.
[38] Id. ¶ 14.
[39] Id. ¶ 13.
[40] As AT&T reports, it has dedicated more than 820 hours independently working on the 1,941 telephone number analysis. See id. ¶ 30. Between both Companies, roughly 4,000 hours have been devoted to the analysis. While the analysis is critical to both parties, it would have been far more efficient to work together and combine resource efforts.
[41] See AT&T Comments at 35.
[42] DeYoung/Tavares Decl. ¶ 14.
[43] DeYoung/Tavares Decl. ¶ 14.
[44] MCI Comments at 6-8; Lichtenberg 4-State Decl. ¶ 13.
[45] See MCI Comments at 8 (emphasis added); Lichtenberg 4-State Decl. ¶ 16.
[46] See SBC Ameritech Michigan’s Supplemental Report on the Line Loss Notification Issue, On the Commission’s Own Motion, to Consider Ameritech Michigan’s Compliance with the Competitive Checklist in Section 271 of the Federal Telecommunications Act of 1996, Case No. U-12320, at 3-5 (May 1, 2002) (“May 1, 2002 Report”). see also SBC Ameritech Michigan’s Final Report on the Line Loss Notification Issue, On the Commission’s Own Motion, to Consider Ameritech Michigan’s Compliance with the Competitive Checklist in Section 271 of the Federal Telecommunications Act of 1996, Case No. U-12320, at 4 (July 2, 2002) (“Final Report”).
[47] See Final Report at 4: “Additionally, SBC performed validations between these codes and the billing name to ensure consistency there as well. Errors identified were corrected.”
[48] See SBC Ameritech Michigan’s Response to WorldCom’s Update on the Line Loss Notification Issue, On the Commission’s Own Motion, to Consider Ameritech Michigan’s Compliance with the Competitive Checklist in Section 271 of the Federal Telecommunications Act of 1996, Case No. U-12320 (Oct. 24, 2002).
[49] Two of the LLNs sent in error in 2003 related to the situation described in CLEC Accessible Letters CLECAMS03-019 (Mar. 6, 2003) (App. J, Tab 38) and CLECAMS03-021 (Mar. 14, 2003) (App. J, Tab 38) when the winning CLEC was on LSOG 5 and assumed only the Billing Telephone Number (“BTN”) of a multi-line account. As noted in those letters, MCI was contacted and provided with information that should have allowed it to reconcile these lines in March of this year. The third 2003 LLN error resulted from manual processing error.
[50] See Lichtenberg 4-State Decl. ¶ 19.
[51] For additional information regarding SOQAR Safety Net reports, see infra ¶ 73.
[52] See Lichtenberg Mich. Decl. ¶ 31.
[53] See AT&T Comments at 38-41; DeYoung/Tavares Decl. ¶¶ 18-19.
[54] See TDS Comments at 9-11; DeYoung/Tavares Decl. ¶ 39.
[55] See Brown/Cottrell/Flynn 4-State Aff. ¶¶ 130-133. The calculation includes all disputes handled by the LSC and would include any claims received during the timeframe quoted which were related to issues/errors which were resolved by the reconciliation. It does not include any claims not handled by the LSC, i.e., collocation and LSB related claims. See id. nn.130-131.
[56] Also not relevant are exclusions from region to region, so long as the data used to present the results is comparative. SBC was not using omissions to “paint a rosier picture” as TDS suggests. The claims chosen are claims regarding services, which represent the vast majority of CLEC order activity. As to TDS’s confusion as to how the dispute rate incorporates back-billing, to the extent that TDS submitted a claim to the LSC regarding back-billed amounts, it would have been included in the claims data.
[57] To be clear, SBC Midwest used the same methodology to derive all of the percentages for all states in its comparison.
[58] See DeYoung/Tavares Decl. ¶ 39.
[59] See AT&T Comments at 41-43; DeYoung/Tavares Decl. ¶¶ 57-60.
[60] See DeYoung/Tavares Decl. ¶¶ 57-58.
[61] See TDS Comments at 11.
[62] See Brown/Cottrell/Flynn 4-State Aff. ¶ 130.
[63] Id., n.130.
[64] See TDS Comments at 11.
[65] See, e.g., DeYoung/Tavares Decl. ¶¶ 7, 39; Lichtenberg Mich. Decl. ¶ 45; TDS Comments at 8.
[66] See Brown/Cottrell/Flynn 4-State Aff. ¶¶ 90-93.
[67] See ACN Comments at 8-9.
[68] See MPSC Docket No. 6720-T1-170.
[69] Subsequently, the Bill Auditability and Dispute Resolution Plan was approved in Illinois, Indiana, Ohio, and Wisconsin.
[70] See Bill Auditability and Dispute Resolution Plan Status Report, MPSC Case No. U-12320 (MPSC filed Apr. 30, 2003); SBC Midwest Status Report on the Bill Auditability and Dispute Resolution Plan, MPSC Case No. U-12320 (MPSC filed July 31, 2003).
[71] See TDS Comments at 18; Affidavit of Rod Cox filed in the Michigan Proceeding ¶ 29, Attachment B to the TDS Comments (“Cox Mich. Aff.”).
[72] Id.
[73] See TDS Comments at 9. Similar claims were also raised by ACN and MCI. See ACN Comments at 7; Lichtenberg Mich. Decl. ¶ 37.
[74] See TDS Comments at 18.
[75] Id.
[76] See Brown/Cottrell/Flynn 4-State Aff. ¶¶ 59-81, 105-126.
[77] Id. ¶¶ 134-135.
[78] See TDS Comments at 13.
[79] See DeYoung/Tavares Decl. ¶ 25.
[80] TDS makes a similar claim. See TDS Comments at 14-15.
[81] See DeYoung/Willard Decl. ¶ 22.
[82] Id.
[83] AT&T Illinois Interconnection Agreement, Sixth Amendment Illinois PUA 2001 Legislation Amendment, § 2.2 (App. B-IL, Tab 3).
[84] The Loop Connection Charge in Illinois is a weighted average of 1) the cost to install a new loop when there is physical work involved and 2) the cost to install a new loop when there is no physical work involved. As discussed below, the state commissions in Michigan and Ohio have established two separate non-recurring charges for these order types.
[85] ICC Tariff No. 20, Part 19, Section 15, Sheet 12 (App. M, Tab 1) (“The applicable non-recurring charge rate elements for the following New UNE-P combination types for new or additional lines is provided below,” which includes a Line Connection Charge-Loop of $20.21. ) (emphasis added).
[86] MPSC Tariff No. 20R, Part 19, Section 15, Sheets 7-8; MPSC Tariff No. 20R, Part 19, Section 23, Sheets 1, 6-15.
[87] The PUCO addressed NRCs for UNE-P. For migrations of existing UNE combinations that would comprise UNE-P, the PUCO adopted a price of 74 cents for basic two-wire arrangements in its October 4, 2001 Order in Case Nos. 96-922-TP-UNC and 00-1368-TP-ATA. See Opinion and Order, Review of Ameritech Ohio’s Economic Costs for Interconnection, Unbundled Network Elements, and Reciprocal Compensation for Transport and Termination of Local Telecommunications Traffic, Case Nos. 96-922-TP-UNC, et al., at 13 (Oct. 4, 2001) (App. D-OH, Tab 151). This was affirmed in the PUCO’s March 13, 2003 Entry in Case No. 00-942-TP-COI. See Entry, Investigation into Ameritech Ohio’s Entry into In-Region InterLATA Service under Section 271 of the Telecommunications Act of 1996, Case No. 00-942-TP-COI, at 15-16 (Mar. 13, 2003) (App. C-OH, Tab 119). For new UNE-P arrangements where physical work is required, the PUCO ordered an interim non-recurring charge for residence lines of $33.88 with the charge for other new lines to be subject to negotiation/arbitration. See Entry, Review of Ameritech Ohio’s Economic Costs for Interconnection, Unbundled Network Elements, and Reciprocal Compensation for Transport and Termination of Local Telecommunications Traffic, Case Nos. 96-922-TP-UNC, et al., at 5 (July 11, 2002) (App. D-OH, Tab 161).
[88] Although AT&T does not mention Indiana in its complaint, SBC has determined that a similar implementation is needed in Indiana, which will also be implemented mechanically on October 8, 2003. Likewise, SBC will work with impacted CLECs in Indiana to manually adjust incorrect charges, to the extent that they exist. The difference in the rates when there is physical work vs. no physical work necessary to install the UNE-P service is only $0.04 in Indiana. In addition, AT&T does not mention Wisconsin in its filing. Based on its preliminary analysis, SBC believes that like Illinois and Michigan, it is properly billing CLECs for these types of non-recurring charges in Wisconsin. During the month of July, AT&T was billed at the rate associated with no physical work in the central office for 27% of the performance measure 28 no field-work orders.
[89] See DeYoung/Tavares Decl. ¶ 21.
[90] See Choice One Comments at 8.
[91] Id.
[92] See CIMCO Comments at 6-7.
[93] See Forte Comments at 11-12.
[94] See IOUCC Comments at 12-13.
[95] See id. at 14.
[96] See Closed Observations Status Report at 210 (Observation 174) (Aug. 26, 2003), available at: .
[97] See MCI Comments at 8, n.4.
[98] Id. at 8-9.
[99] See Phase II Determination, Petition of Wisconsin Bell, Inc. for a Section 271 Checklist Proceeding, PSCW Docket No. 6720-TI-170, at 19-20 (July 7, 2003) (App. C-WI, Tab 67).
[100] Id.
[101] Id. (footnote omitted).
[102] Notice of Proceeding and Investigation and Assessment of Costs and Prehearing Conference, Investigation into the Wholesale Billing Practices of Wisconsin Bell, Inc. d/b/a SBC Wisconsin, PSCW Docket No. 6720-TI-183, at 1 (July 10, 2003) (App. M, Tab 189).
[103] Id.
[104] See Mpower Comments at 6.
[105] Id. at 6.
[106] See NTD Comments at 4.
[107] See generally Cox Mich. Aff. Mr. Cox’s allegations have been previously addressed in WC Docket No. 03-16 (e.g., incorrect rate allegations, see Brown/Flynn/Cottrell Joint Reply Aff. ¶¶ 25-31; special construction charges a/k/a loop conditioning charges, see Brown/Flynn/Cottrell Joint Reply Aff. ¶ 33; charges for toll reciprocal compensation charges, see Brown/Flynn/Cottrell Joint Reply Aff. ¶ 34; in WC Docket No. 03-138, see Brown/Cottrell/Flynn Supp. Reply Aff. ¶¶ 90-100; and in this proceeding as well, see Brown/Cottrell/Flynn 4-State Aff. ¶¶ 172-182).
[108] See TDS Comments at 8.
[109] See TDS Comments at 15-16.
[110] Id. at 12.
[111] Id. at 19-20.
[112] Id. at 22.
[113] Id.
[114] Id. at 23.
[115] Notice of Proceeding and Investigation and Assessment of Costs and Prehearing Conference, Investigation into the Wholesale Billing Practices of Wisconsin Bell, Inc. d/b/a SBC Wisconsin, PSCW Docket No. 6720-TI-183, at 1 (July 10, 2003) (App. M, Tab 189).
[116] See Z-Tel Comments at 11.
[117] Id.
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