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24669 - Porter v. SC Public Service Commission, et al.

Davis Adv. Sh. No. 24
S.E. 2d

THE STATE OF SOUTH CAROLINA

In The Supreme Court

Philip S. Porter,

Consumer Advocate for

the State of South

Carolina, Appellant,

v.

South Carolina Public

Service Commission and

AT&T Communications of

the Southern States, Inc., Respondents.

Appeal From Richland County

L. Casey Manning, Circuit Court Judge

Opinion No. 24669

Heard May 21, 1997 - Filed August 11, 1997

AFFIRMED

Phillip S. Porter, Nancy Vaughn Coombs, and Elliott F.

Elam, Jr., all of Columbia, for appellant.

F. David Butler and Florence P. Belser, of Columbia, for

respondent S.C. Public Service Commission, and Francis P.

Mood and Joseph D. Clark, both of Sinkler and Boyd, of

Columbia, for respondent AT&T Communications of the

Southern States, Inc,

WALLER, A.J.: This appeal involves an order of the Public Service

Commission (PSC) which removed price caps for certain business services provided

by AT&T. We affirm.

FACTS

Subsequent to AT&T's divesture in 1983, the PSC issued Order # 84-622

regulating interexchange telephone carriers (IXCS) and setting forth price caps. In

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PHILIP S. PORTER, etc. v. SCPSC, et al.

1995, AT&T filed a petition pursuant to S.C. Code Ann. § 58-9-585 (Supp. 1994)

seeking alternative regulation for certain of its services,1 and requesting, inter alia,

PSC to declare these services competitive and remove price caps therefrom. By Order

# 95-1734, PSC found the "substantial evidence of record does not show ... that

AT&T's services for which it seeks alternative regulation are competitive."

Nonetheless, PSC found "the competitive forces demonstrated did warrant

modification of the existing process" and removal of the price caps. PSC modified the

existing rate structure to provide the maximum rate requirements would be removed

provided AT&T filed tariffs which reflect average toll rates within South Carolina.

The modification was implemented on a trial basis. The circuit court affirmed the

PSC; the Consumer Advocate appeals.

ISSUE

Did the PSC act within its authority in removing the rate caps?

DISCUSSION

The Consumer Advocate contends that, once PSC determined that AT&T had

failed to prove its services were "competitive" within the meaning of section 58-9-585,

PSC was without authority to remove the rate caps. We disagree. We find PSC had

authority to modify Order #84-622 pursuant to both § 58-9-585 (D), and its general

powers under § 58-9-720 (1976) and 58-3-140 (1976).

S.C. Code Ann. § 58-9-585 provides, in pertinent part:

(A) Notwithstanding any other provision of this chapter, the

commission, on the request of an interexchange telecommunications

carrier or on its own motion, may consider, in lieu of the procedures

outlined in this chapter, alternative means of regulating that carrier. If

the commission first determines, after notice and hearing, that the

substantial evidence of record shows that a particular service is

competitive in the relevant geographic market, the commission may

implement regulatory alternatives including, but not limited to, the

provisions outlined in this section. (B) If the commission determines that an interexchange telecommunications carrier service is competitive, the commission shall not fix or prescribe the rates, tolls, charges, or rate structures for that service .... (D) For an interexchange telecommunications carrier service found to be ___________________________

1The services in question were business long distance services, consumer card and

operator services.

p35

PHILIP S. PORTER, etc. v. SCPSC, et al. noncompetitive, the commission may implement other regulatory alternatives including, but not limited to, price caps. (Emphasis

supplied).

Under the literal terms of § 58-9-585, PSC is authorized to implement regulatory

alternatives regardless of whether it finds a service competitive or noncompetitive.

Compare subsections (A) & (D). Although subsection (A) appears to require a finding

of "competitiveness" prior to implementation of an "alternative means of regulation,"

subsection (D) clearly permits PSC to implement alternative regulatory means,

"including, but not limited to" price caps, notwithstanding a lack of competitiveness.

Clearly, this language permits, but does not require PSC to utilize rate caps.

Further, nothing in this statute, or in any other section of Chapter 9 of Title 58,

requires PSC to implement or retain rate caps. The only absolute mandate under §

58-9-585 is found in subsection (B), which prohibits rate caps upon a finding of

competitiveness. As nothing in the statute requires rate caps, PSC clearly had

authority to remove them under subsection (D).2

In addition to its authority under § 58-9-585, PSC relies upon § 58-9-720 and

§ 58-3-140 as general authority for its modification of Order # 84-622. We agree with

PSC, and the circuit court, that these sections are consistent with PSC's powers

under § 58-9-585.

Sections 58-3-140 (1976) and 58-9-720 (1976) vest PSC with broad general

powers to "supervise and regulate the rates and service" of every public utility (§ 58-

3-140) and to fix "just and reasonable classifications, regulations, practices or service

to be furnished, imposed, observed and followed by any or all telephone utilities..."

(§ 58-9-720). Order # 84-622, setting forth rate caps, was implemented pursuant to

PSC's general powers under Sections 58-3-140 (1976) and 58-9-720 (1976). Since

nothing in § 58-9-585 requires PSC to set rate caps, we find these statutes, together

with § 58-9-585, permit PSC to alter the procedures previously set forth by it in Order

#84-622.3 Hamm v. AT&T, 302 S.C. 210, 394 S.E.2d 842 (1990)(PSC may modify or __________________________

2Although PSC did not rely on this section for its modification, § 58-9-585 was the

sole basis for relief asserted by AT&T. This Court may take judicial notice of a

statute, Jones, Inc. v. B-F Limited Partnership, 276 S.C. 469, 279 S.E.2d 613 (1981),

and may affirm for any reason appearing in the record. State v. Smith, 316 S.C. 53,

447 S.E.2d 175 (1994); Rule 220 (A), SCACR.

3The Consumer Advocate contends that § 58-9-585, being the more recent and

specific legislation, controls. See State v. Brown, 317 S.C. 55, 451 S.E.2d 888 (1994);

Whiteside v. Cherokee County School District No. One, 311 S.C. 335 428 S.E.2d 886

(1992). However, this rule of statutory construction comes into play only when there

is a conflict between the statutes. See Williams v. Town of Hilton Head, 316 S.C. 53,

429 S.E.2d 802 (1993)(where it is not possible to harmonize two statutes, the later

legislation supersedes the earlier enactment). Where two statutes can be reconciled

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PHILIP S. PORTER, etc. v. SCPSC. et al.

(1990)(PSC may modify or amend its own orders after notice and an opportunity

to be heard). Cf. Heater of Seabrook v. PSC, Op. No. 24473 (S.C. Sup. Ct. filed

Aug. 12, 1996) (Davis Adv. Sh. No. 22 at 2)(South Carolina law does not require

Commission to use any particular price-setting methodology).

Finally, Consumer Advocate contends that interested parties were not on

notice that Order # 84-622 might be modified. We disagree.

AT&T's petition, although requesting relief under section 58-9-585, clearly

requested a removal of price caps. Since the only thing requiring price caps was

Order # 84-622, any modification of price caps pursuant to the statute would, of

necessity, require a modification of Order 84-622. This Court has recognized that,

pursuant to its authority under § 58-9-1200 (1976), the PSC may modify or amend

its own orders after notice and an opportunity to be heard. Hamm v. AT&T, supra.

Although a modification of Order # 84-622 was not specifically pled by AT&T, it did

specifically request a removal of price caps. This was sufficient to put Consumer

Advocate on notice that a modification of Order # 84-622 would be required if price

caps were removed. Cf. GTE Sprint Comm'n v. PSC, 288 S.C. 174, 341 S.E.2d 126

(1986)(prior PSC order sufficient to give notice of standards upon which PSC would

base decision).

AFFIRMED.

FINNEY, C.J., TOAL, and MOORE, JJ., and Acting Associate

Justice George T. Gregory, Jr., concur. __________________________

statutes can be reconciled

and are susceptible of a construction which will render both operative without doing

violence to either, it is the duty of the court to so construe them. Lewis v. Gaddy,

254 S.C. 266, 173 S.E.2d 376 (1970). Here, there is no conflict between the

statutes and, accordingly, they may be harmonized.

Further, since PSC acted within its authority pursuant to these sections, it

did not, as the Consumer Advocate contends, exceed its statutory authority under

§ 1-23-380 (A)(6)(b) & (c); of the Administrative Procedures Act.

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